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HOW IS MERCEDES-BENZ'S

new California advanced design studio coming along? Not well, if Joel Piaskowski's sudden move from the studio (he was its chief) to Ford in Dearborn is any indication. Piaskowski is the highly talented designer whom Mercedes lured from Hyundai in January 2008. On October 1, he went over to Ford, where he reports to executive design director Moray Callum. From 2003 to 2008, Piaskowski was head of Hyundai's California design studio, where he led work on the Genesis coupe. Sonata, Tucson, and concepts HCD8, HCD9 Talus, and HCD10 Hellia. He was key in transforming Hyundai's image from cheap and dowdy to aspirational. Piaskowski began his career in the late 1980s at General Motors, working on Chevy, Pontiac, Opel/Vauxhall/ Holden, and Buick, as well as GM's old Asian partners, Isuzu and Suzuki. Let's hope Ford's design department can nurture Piaskowski, who's in his early 40s, as Hyundai, not Mercedes, did... The C7 Corvette body is done, after a two-design in-house competition at GM Design. Like the C6 that launched as a 2005 model, the 2013 or 2014 Corvette will be an evolutionary update of the current car, say, a C6.5. One sticking point on the engineering side is whether Chevrolet can apply cylinder deactivation to the V-8, though it's coupled to a rear-mounted transmission. Engineers are reluctant to try new solutions to the situation, because the solutions could result in problems with drivetrain quality or power. Why all the interest in cylinder deactivation in a V-8-powered sports car? Because post-2016 fuel economy standards are expected to dictate it...Dan Creed has been named BMW North America's vice president of marketing, the position Jack Pitney held when he lost his life in a tractor accident on his farm in New York. Creed was vice president for BMW North America after-sales, covering parts, service, accessories and lifestyle products. Pitney was planning to move to the position of vice president for the Eastern Region when he died. Russ Lucas, preowned sales manager, has taken that position. ■

DESIGNER Ken Okuyama's love for cars is exceeded only by his love for wristwatches, especially those from TAG Heuer. He prizes these precision pieces so much that he's created a sports car inspired by a Grand Carrera watch. His K07 roadster might employ a Lotus Elise R platform and powertrain, but that's where the similarity ends.

Many may remember the 51-year-old Okuyama as Pininfarina's design director. He was the man behind the Ferrari Enzo, Maserati Quattroporte, and Maserati Birdcage concept. Since leaving Pininfarina in 2006, he has expanded his design focus to encompass everything from teapots to eyewear, furniture to motorcycles, buildings to robots, and even the next-generation Shinkansen bullet train.

"I've always loved collecting watches," Okuyama says. "And I get a real buzz out of seeing the way they are used in film. The scene in the movie Le Mans, where Steve McQueen drives up in his Porsche 911 and gets out as the camera zooms in on his TAG Heuer Monaco watch, well, that's one of my all-time favorites. And one that I admit gave me a lot of inspiration for this car."

Also influenced by legendary Lotus founder Colin Chapman, Okuyama played with the idea of a lightweight roadster for many years, but the project only took off after he showed some sketches to TAG Heuer CEO Jean-Christophe Babin.

"Up until that point, I had only penned the exterior surfaces, influenced heavily by watch mechanicals. Then, when Jean-Christophe added further inspiration to the

process, input that made me decide to design the whole car, including the interior, based on TAG Heuer watches, I conceived the instrumentation and even steering wheel with the combination of silver [aluminum] and black [carbon],"Okuyama says.

Push the start button and the engine springs to life with a raspy

exhaust note. Nice. Located just 12 inches behind the driver's left ear, the gutsy Toyota 2ZZ-GE, bored out from 1.8 to 2.0 liters, generates around 207 horsepower (18 up on the Elise R). With curb weight down from the Lotus' 1984 pounds to 1740, you can really feel the difference.

Using our stopwatch function—of course, the one on the dashboard-mounted Grand Carrera—we clocked a 0-60-mph sprint time of 5 seconds flat, just eclipsing the Elise R's best time.This thing's quick.

It's heroic on the twisties, too, though we expected nothing less from the Elise's underpinnings, tweaked to suit Okuyama's needs. The roadster turns in superbly with perfectly weighted steering, while 17-inch Dunlop rubber delivers loads of grip under acceleration.

"We might be using a Lotus monocoque chassis, but we have pretty much redesigned the whole car," Okuyama says. The front end has been completely restyled and now boasts a narrower, sleeker-looking nose. "I wanted to build a car that I'd like to drive, a car that was beautiful to look at, something that hinted at open-wheeler formula cars. We totally revised the suspension and rack-and-pinion-steering setups."

With help from Japanese engineering firm AIM, Okuyama's team retuned the K07's handling by revising the dampers, lengthening the arms, and modifying the steering column and gear ratio. Bottom line: This car is quicker and more fun to drive than an Elise R, and handles better.

Okuyama has plans to drop a Ford Focus Cosworth engine in the car. "That would up the price, but I know there are drivers out there who would jump at such a chance." He's right about price. The K07 (with a Toyota engine) costs more than 20 million yen, or about $240,000. With a Cosworth engine, you can probably add another 10 percent to that base fee, he says. "A Honda S2000 powertrain would also work well in the K07, because of its high-rewing engine and marvelous gearbox.That is yet another option we have." ■ peter lyon

(trend)

NEWS/OPINION/GOSSIP/STUFF

we hear

CADILLAC is considering a coupe design for its $125,000 flagship (see "Zeta Chevy sport sedan is back on,""Trend," November). This isn't as strange as it sounds. From 1934-37, Cadillac built 20 production V-16 Aerodynamic Coupes. Cars like the front-drive 1967 Eldorado, the 1987 Allanté, and last decade's Corvette-based XLR also served as flagships. A Cadillac coupe flagship would compete, more or less, with such cars as the Bentley Continental GT. The planned flagship is not to be confused with a new Zeta-based rear-drive large sedan. That car will come in under six digits and will be larger and more luxurious than the CTS and XTS, aimed at the Mercedes S-Class and BMW 7 Series.

BMW will power the next Saab 9-3, scheduled as a '13 model. The BMW Group has signed a deal to provide four-cylinder engines, "with latest fuel-saving technologies," in calendar year 2012. BMW and Saab both declined to disclose financial and contract volume details, or even what kind of four-cylinder engine BMW would supply. And the Saab recipient is described only as "a new Saab model series," though the Swedish automaker, under its new owner, Spyker, has been open about the next 9-3's development. Saab began work on a new 9-3 a few years ago under General Motors. The development was suspended, and Spyker's Saab intends to do enough development work, including designing the engine compartment for the Bimmer four on it, that it's calling the GM Epsilon l-derived architecture an exclusive Saab platform. As for the engine, it's obviously a transverse version of the 2.0-liter and/or smaller gas fours used in European-spec BMW 1 Series models. The engines are built at Hams Hall in the U.K., and will be used in BMW's upcoming sub-1 Series front-drive model as well.

DAMN the engineering cost—low-speed ahead. "Americans deserve more fuel-efficient cars,"the Consumer Federation of America concludes. The CFA and 21 of its state and local groups have sent a letter to President Obama calling for a 60-mpg Corporate Average Fuel Economy standard for cars and trucks by 2025, because it will save consumers money. "Savings from reduced gasoline consumption at 60 mpg would more than offset any increase in vehicle prices likely to result from adding technologies to lower gasoline consumption," the CFA says.

PORSCHE expects to double its worldwide sales volume simply by adding a compact sport/utility to its lineup, without needing another sports car, Volkswagen AG Chairman Martin Winterkorn tells Paul Horrell. However, Porsche CEO Mathias Muller implied he's not quite as bullish as Winterkorn about raising Porsche volumes at the cost of exclusivity. Meanwhile, Ulrich Hackenberg, VW board member for technical development, has officially confirmed the Volkswagen Bluesport mid-engine sports car for production. The car, unveiled at the 2009 Detroit auto show, is expected to spin off a sub-Boxster Porsche and possibly an Audi version. ■

Notes from the revolution

Rattner's Overhaul lifts the lid on GM and Chrysler

WHATEVER your opinion of Steven Rattner and the government's $81.9-billion federal bailout of GM, Chrysler, their financing arms, and their suppliers, Overhaul is required reading to understand the auto industry. As chief advisor of the U.S.Treasury's Automotive Task Force (or Team Auto), Rattner was allowed an inside view that no GM or Chrysler executive would ever reveal. The mismanagement described in Overhaul (2010, Houghton Mifflin Harcourt, $27) will confirm the worst you've suspected of Chrysler and especially General Motors.

GM had finance guys running the company, and those guys—Rick Wagoner, Fritz Henderson, and Ray Young—left its finances in shambles. An incompetent GM board backed incompetent management. Although Rattner had to fire Wagoner, he wanted retiring GM Chairman Ed Whitacre to keep Henderson as CEO.

"When we pitched Fritz" to the new GM board as Wagoner's replacement, "it was with the hope that he would be there permanently," Rattner told Motor Trend in a phone interview before the release of his book.

GM management excelled at giving PowerPoint presentations and blaming its problems on the economy and the United Auto Workers. It couldn't forecast or analyze the market. Wagoner based his late 2008 request for $10 billion in federal aid on assumptions GM market share would rise and auto sales would quickly rebound."Asked how he could be confident of such forecasts, Wagoner waxed eloquent about the new Chevy Malibu and GM's gains in J.D. Power quality studies," Rattner writes.

In its February 17, 2009, plan, Chrysler asserted it"could survive as an independent entity by hunkering down, cutting costs, and reducing debt, which struck us as far-fetched," says the book. An alternative plan to form an alliance with Fiat "seemed plausible. But the report gave only the sketchiest of details, not nearly enough information for us to evaluate it."

In March, Harry Wilson, Team Auto's expert in corporate restructuring (and a registered Republican), asked GM CFO Young how much cash cushion GM needed on hand for such day-to-day operations as paying suppliers. Young's $11-billion estimate was far too high, Wilson thought. He had calculated $6 to $7 billion based on GM's proportion to Ford and Chrysler.

"Young explained that GM was using a formula based on sales volume, and started walking Harry through the calculation. But as he cited the figures, it was plain they didn't add up to anywhere near $11 billion," Rattner writes. "The calculations added up to $6 to $7 billion, Wilson told him. Young seemed genuinely puzzled."

Young remains at GM, not as CFO, but as vice president of international operations. After reading Overhaul, you'll wonder why Whitacre didn't sack every GM manager from midlevel on up.

Rattner was a reporter for The New York Times before he worked on Wall Street. His prose is straightforward and a bit steeped in clichéd phrases and transitions, like the book title's pun. It's a quick read, though, and well worth the insight on stories that broke throughout '09, like JPMorgan Chase Vice Chairman Jimmy Lee's proposal to sell Chrysler to GM; Carlos Ghosn's proposal to make GM part of the Nissan-Renault alliance; and how Team Auto considered chopping Buick to keep only Chevrolet, GMC, and Cadillac. Rattner's auto industry naïveté surfaces only when he quotes President Obama asking why GM and Chrysler can't build Corollas. Rattner notes there's no way for the Chevy Volt "or any next-generation car to have a positive impact on GM's finances any time soon,"forgetting that GM has long been pilloried for failing to take the long-term view of such technologies as the Toyota Prius'hybrid system.

Rattner first refers to the pay-to-play scandal involving his former equity firm, Quadrangle Group, on page 167. It wasn't the reason he left Team Auto, he maintains.

Overhaul makes a strong case for the bailouts, though. Saving GM and Chrysler was not socialism. It was pragmatic, balanced capitalism with government oversight. It saved jobs, and with the distasteful bailout of the banking industry, likely prevented a depression potentially far worse than the great one of the 1930s.

"It is disappointing that the companies seem to be doing so well in this economy, and there's overwhelming opposition"to the bailouts, Rattner told me. He credits the opposition to "frustration and unhappiness about the state of the economy."

Rattner paints Team Auto's Section 363 negotiations with Chrysler and GM creditors as being businesslike. He offered $1.5 billion on JPMorgan's $2.7 billion in loans to Chrysler, while Jimmy Lee held out for $2.5 billion.They settled on $2 billion in cash.

Lee said JPMorgan would be reluctant to make such future deals with the federal government. Almost a year later, Lee appeared at Treasury to pitch JPMorgan as an underwriter for GM's Initial Public Offering. And to anyone who was interested, he showed pictures on his BlackBerry of his new $ 110,000 cobalt blue ZR1, a topline Corvette. He'd bought it to demonstrate his commitment to the product. ■ todd lassa

AN INSIDER'S ACCOUNT OF THE OBAMA ADMINISTRATION'S EMERGENCY RESCUE OF THE AUTO INDUSTRY

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