Author: Detroit News Online

Corrupt FCA exec reported to Marchionne amid scheme

Corrupt FCA exec reported to Marchionne amid schemeDetroit — Federal prosecutors Monday drew a direct line between former Fiat Chrysler CEO Sergio Marchionne and Alphons Iacobelli amid a multimillion-dollar conspiracy to corrupt labor negotiations with the United Auto Workers.
In a federal court filing, prosecutors noted that Iacobelli, as Fiat Chrysler's top labor negotiator, reported directly to Marchionne regarding certain aspects of Fiat Chrysler's negotiations and relationship with the UAW.
It was the first time the government referred to Marchionne by title and served as the government's strongest statement about the late auto CEO and a years-long criminal conspiracy designed to wring concessions from the UAW by funneling money and illegal gifts to labor leaders. Those illegal payments included $1,000 pairs of designer shoes, first-class travel, furniture, lavish meals, parties, jewelry and custom-made Italian watches.
The conspiracy continued after Iacobelli left Fiat Chrysler in 2015, prosecutors said while adding that the former labor negotiator has helped expose “vast labor-management corruption” and is “assisting in efforts to end it.”
“The seriousness of the corruption of the labor-management relationship cannot be overstated,” Assistant U.S. Attorney David Gardey wrote in the filing. “Because of FCA’s conduct, through Iacobelli and others, tens of thousands of hourly UAW workers were deprived of the representation that they deserved and paid for in union dues.”
Prosecutors made the allegations in a federal court filing ahead of Iacobelli's sentencing for violating federal labor laws and a tax crime. The government wants Iacobelli, 59, of Rochester Hills, to spend more than six years in federal prison when U.S. District Judge Paul Borman sentences the former auto executive Aug. 27.
The filing came four days after The News reported that Marchionne gave an expensive Italian watch to United Auto Workers Vice President General Holiefield and failed to disclose the gift while being questioned by federal investigators.
In the filing Monday, prosecutors noted that UAW officials received multiple “custom-made Italian watches,” but stopped short of saying Marchionne gave the gifts.
Marchionne, 66, was never charged with a crime before he died July 25 in a Zurich hospital.
A Fiat Chrysler spokeswoman declined to comment on the federal filing.
The watches, money and illegal gifts were part of a conspiracy to buy labor peace from a cash-strapped UAW, prosecutors said.
Iacobelli is the highest-ranking Fiat Chrysler official convicted in the conspiracy. Seven people have been convicted, including Holiefield's widow, Monica Morgan-Holiefield, who was sentenced to 18 months in federal prison last month.
Iacobelli funneled millions to UAW officials through the jointly operated UAW-Chrysler National Training Center.
He also enjoyed a lavish lifestyle bankrolled by Fiat Chrysler cash.
“This additional income that Iacobelli received took many forms, including a Ferrari, jewel-encrusted pens, hundreds of thousands of dollars in improvements and additions to the pool at his residence, personal spending on his credit cards, and more,” the prosecutor wrote.
The filing Monday also came one week after Iacobelli's lawyer pushed the judge to sentence the auto executive to less than four years in prison.
Iacobelli could be sentenced to eight years in prison under terms of a plea deal. But prosecutors said he deserves a break for admitting responsibility and cooperating with the ongoing investigation.
“. . . the sentence also should account for Iacobelli’s acceptance of responsibility and his sincere efforts at revealing vast labor-management corruption and assisting in efforts to end it,” Gardey wrote.
According to prosecutors, one scheme that continued after Iacobelli's departure was reimbursing the UAW for salaries and benefits of labor officials assigned to the training center. The reimbursement is called a “chargeback.”
A “large number” of UAW officials provided little, if any, work at the training center, according to the government, which called the practice a “political gift” from Fiat Chrysler to the union.
“It was merely a corrupt mechanism whereby FCA money could be used by the UAW to keep the UAW’s costs down,” the prosecutor wrote.
From 2009 to last year, the chargebacks saved the UAW more than $9 million, according to the government.
rsnell@detroitnews.com
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Twitter: @robertsnellnews
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Study: States should require licensed drivers for robot cars

Study: States should require licensed drivers for robot carsWashington — A group that represents state highway safety offices is urging states like Michigan to consider requiring licenses for self-driving cars operators because they likely are decades away from being fully automated.
The Washington-based Governors Highway Safety Association says in a study released Wednesday that states should prepare themselves for establishing licensing requirements for self-driving cars because autonomous vehicles “for the foreseeable future will share driving responsibility with humans, and are likely do so for many decades.”
The findings represent an injection of regulatory reality into the race for autonomous leadership. The battle for next-generation leadership is pitting Detroit’s automakers and their global rivals against a deep-pocketed tech industry based in China and, especially, Silicon Valley.
The study recommends that states “consider laws requiring or assuming that a licensed driver is present in each vehicle, especially for AVs (autonomous vehicles) in which a licensed driver may be called upon to take control.” It also suggests that states “update traffic laws to accommodate AVs and help to prepare state driver licensing agencies to identify and register AVs” and “establish law enforcement policies and procedures regarding AV operations and train all patrol officers in these policies and procedures.
Federal regulators have thus far shied away from the notion of craft rules for self-driving car operators, focusing instead on testing and regulation of the autonomous vehicles. They argue states are best equipped to continued setting rules for road as they do now.
“States need to consider a number of new issues related to the practical deployment of this technology,” Jim Hedlund, a former senior official with the National Highway Traffic Safety Administration who authored the study, said in a statement. “One of the most important goals should be to educate the public about the benefits and risks of this technology, how to use it safely, and drive near AVs in traffic.”
Congress is working to craft rules that would govern the testing and eventual sale for mass consumption of self-driving cars. The Senate is debating a new law that would allow each automaker to sell more than 80,000 self-driving cars per year, but the measure has been held up for nearly a year amid concerns about the liability rules that would govern crashes involving self-driving cars and the vulnerability of driverless systems to potential hackers.
A similar self-driving measure sailed through the House of Representatives with relatively ease last year.
The U.S. Department of Transportation also has proposed self-driving rules that focus on a set of 15 guidelines calling for automakers and technology companies to voluntarily report on their testing and safety of autonomous cars to the National Highway Traffic Safety Administration before the cars are used by the public.
Under the DOT proposal, before self-driving cars are allowed to roll on U.S. roads, automakers would be required to report how they were tested, how the systems work and what happens if those systems fail.
The Trump administration has said it is working on what would be a third set of voluntary guidelines for self-driving cars issued by the federal government since 2016.
Both sets of proposed rules call for states and other local jurisdictions to defer to the federal government on regulations related to self-driving cars’ design, construction, software or communication. Under both proposals, states still would be allowed to regulate registration, licensing, liability, education and training, insurance or traffic laws.
Jonathan Adkins, GHSA Executive Director, said states will likely have to continue to play a role in self-driving car regulation for long after the technology is initially rolled out.
“Imperfect human drivers aren’t disappearing anytime soon and even with self-driving technology, they will still be in a position to cause crashes, deaths, and injuries on our roads,” Adkins said. “As autonomous vehicle technology advances, states still must invest in programs to prioritize safe travel behavior.”
Ryan Gammelgard, counsel at State Farm, which funded the self-driving study, said in an interview with The Detroit News that the insurance industry agrees it is “very important to not lose sight of the role that humans are going to have in this.
“We worked really hard over the last year to make sure insurance is at the table as some of these issues are being discussed,” he said. “We can’t ignore reality that automakers and tech companies are spending $80 to $100 billion in order to implement this technology.”
klaing@detroitnews.com
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Twitter: @Keith_Laing
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Ford’s Corktown campus cost: $740M

Ford’s Corktown campus cost: $740MFord's new beginning for the old train station FullscreenPosted!A link has been posted to your Facebook feed.
Buy PhotoFord Executive Chairman Bill Ford Jr. stands in the lobby of the former Michigan Central Depot train station in Detroit, June 14, 2018. Ford Motor Co.'s purchase of the building and several others in Corktown will allow the automaker to build a new mobility corridor along Michigan Avenue, from Corktown to its facilities in Dearborn, Willow Run and the University of Michigan campus.Buy PhotoFullscreenBuy Photo”It's not just a building,” Ford Executive Chairman Bill Ford Jr. told The Detroit News in an interview. “It's an amazing building, but it's about all the connections to Detroit, to the suburbs, and the vision around developing the next generation of transportation.”Buy PhotoFullscreenBuy PhotoMichigan Central Depot would attract new employees to develop the mobility, autonomy and electrification technologies billed as the biggest disruptors to the auto industry since Henry Ford began making Model T's for the masses. A view of the Detroit skyline from the top floor of the Michigan Central Depot train station.Buy PhotoFullscreenBuy PhotoThe Corktown outpost is meant to supplement Ford's work on its Dearborn campus, and it will use a portion of the undisclosed dollar amount Ford set aside in 2016 to accomplish that redesign. The lobby of the Michigan Central Depot train station.Buy PhotoFullscreenBuy Photo”It's not just a building,” said Ford Executive Chairman Bill Ford Jr., standing in the depot's atrium. “It's an amazing building, but it's about all the connections to Detroit, to the suburbs, and the vision around developing the next generation of transportation.”Buy PhotoFullscreenBuy PhotoA hallway leads to the lobby. Ford expects the building to attract new employees to develop the mobility, autonomy and electrification technologies important for its future.Buy PhotoFullscreenAn artist's rendering shows a market for fresh produce in the atrium space.FullscreenBuy PhotoThe ground floor lobby of the 18-story, 500,000-square-foot building would be open to the public. That space could house markets, coffee shops, restaurants, retail and gathering spaces. A hotel or residential component also is being considered.Buy PhotoFullscreenBuy PhotoFord's plan for the depot is currently an outline. Bill Ford Jr. envisions a bustling public space akin to San Francisco's Ferry Building Marketplace.Buy PhotoFullscreenIn addition to the train station, above, Ford has purchased these Corktown properties: The Factory, 1907 Michigan Ave.; the old book depository, 2231 Dalzelle St.; and vacant land adjacent to PAL complex.FullscreenA rendering imagines the ground floor of the old Michigan Central Depot as a public space with retail, restaurants and gathering spaces.FullscreenBuy Photo”One thing I don't want to do is take a beautiful building and put something that's garish on there,” Bill Ford Jr. said. ”
“We don't want to be isolated and we don't want to be seen as taking over the community by any means.”Buy PhotoFullscreenBuy PhotoA small fraction of the company's Dearborn workforce would move into the station, with all but Ford's electrification and autonomous driving teams remaining in Dearborn to occupy the sprawling, estimated $1 billion campus redesign there slated for completion in the mid-2020s.Buy PhotoFullscreenBuy PhotoRoughly a third of the renovation cost would be comped by tax breaks for the historic restoration of the depot. Ford, the city, and the former owners of the building have declined comment on the purchase price or how much Ford will spend on the renovation.Buy PhotoFullscreenBuy PhotoA small fraction of the company's Dearborn workforce would move into the station, with all but Ford's electrification and autonomous driving teams remaining in Dearborn to occupy the sprawling, estimated $1 billion campus redesign there slated for completion in the mid-2020s.Buy PhotoFullscreenBuy PhotoWhile the public space would occupy the 300,000 square feet on the ground floor of the station and other Corktown properties, 2,500 Ford employees and 2,500 partner employees would occupy the remaining 900,000 square feet come 2022. This is the top floor.Buy PhotoFullscreenBuy PhotoFord CEO Jim Hackett said the Corktown outpost will give Ford's teams access to a true urban landscape in which to test autonomous technology and how those vehicles will need to communicate with traffic systems, delivery destinations and other infrastructure.Buy PhotoFullscreenBuy PhotoHackett said the Corktown project won't cost Ford any more than the estimated $1 billion it budgeted for the Dearborn transformation plan. Money for the Corktown outpost came out of that original budget. Above, a stairwell on the top floor of the Michigan Central Depot.Buy PhotoFullscreenBuy PhotoThe ticket booths used to occupy this space in the Michigan Central Depot.Buy PhotoFullscreenBuy PhotoFord will announce officially on June 19 its plans for the building, followed by a party in Roosevelt Park in front of the long-vacant building.Buy PhotoFullscreenBuy PhotoWorkers prepare for Ford's press conference Tuesday, June 19, to talk about their purchase of the train station.Buy PhotoFullscreenBuy PhotoLighting crews work in the lobby to prepare for the Tuesday, June 19 press conference.Buy PhotoFullscreenBuy Photo”This is our home,” Bill Ford Jr. said during an interview in Ford World Headquarters in Dearborn. “We're not leaving by any means. By the end of this we'll have a large multiple of employees in Dearborn versus Detroit.” Bill Ford Jr., chairman of Ford Motor Company, speaks about the purchase of the Michigan Train from the Moroun family during an interview from Ford World Headquarters in Dearborn on Thursday, June 14, 2018.Buy PhotoFullscreenBuy PhotoReviving the depot and establishing Corktown on that mobility corridor will require tax incentives to renovate the building at its heart, according to Bill Ford Jr. A stairwell on the top floor.Buy PhotoFullscreenBuy PhotoBill Ford said the depot restoration price “dwarfs the purchase price.” Workers prepare for Ford's press conference to celebrate their purchase of the train station.Buy PhotoFullscreenBuy Photo”This is an exclamation point” for Detroit's resurgence,” Bill Ford Jr. said. “Ford and Detroit have seen good times, we've seen bad times, and this is a tough region. We've been through it together. This is an authentic move for the city and for us. Frankly, it's where it all began.”Buy PhotoFullscreenReplay1 of 262 of 263 of 264 of 265 of 266 of 267 of 268 of 269 of 2610 of 2611 of 2612 of 2613 of 2614 of 2615 of 2616 of 2617 of 2618 of 2619 of 2620 of 2621 of 2622 of 2623 of 2624 of 2625 of 2626 of 26AutoplayShow ThumbnailsShow CaptionsFord Motor Co. plans to spend as much as $740 million on its planned 1.2 million-square-foot Corktown campus, company officials announced Tuesday night.
The automaker said it expects to seek $250 million over 34 years through local, state, federal tax incentives to offset the cost, a representative said, as it launches its ambitious plan to revitalize the area, including the derelict Michigan Central Depot.
“We are excited by the opportunities that Ford’s investment in the train station and other key Corktown sites will bring, not only for the larger resurgence of the neighborhood but all of Southeast Michigan, including economic growth, attracting world-class talent and leading the development for the next generation of the automotive industry,” Ford Land said in a statement.
“Given Ford’s investment in the Corktown projects, we are actively working with federal, state and local officials for tax and other incentives to support the development.”
The investment involves five Corktown neighborhood sites, including the building and land purchase as well as expected building exterior and infrastructure rehabilitation costs over the next four years, Ford Land said Tuesday.
The cost estimate was unveiled during a neighborhood advisory council meeting at the International Brotherhood of Electrical Workers No. 58 in Detroit on Tuesday. The panel is slated to work with Ford to create a community benefits agreement.
The city recently released the complete list of area residents appointed to serve on the nine-member neighborhood advisory council. The advisory council members are:
— David Esparza, Nicole Rittenouer, Mike Ransom and Ken Jameson appointed by Planning and Development Department Director Maurice Cox.
— Robin Ussery appointed by Detroit City Council member Raquel Castañeda-López. Previously, City Council President Brenda Jones selected Hubbard-Richard resident Aliyah Sabree, a judge in the 36th District Court.
— Councilwoman Janee Ayers chose Sheila Cockrel, a Corktown resident and former member of the city council.
–The community voted for Jerry Paffendorf, co-owner of Loveland Technologies, and Heather McKeon, an interior designer with Patrick Thompson Design.
Upcoming advisory council meetings are scheduled for Aug. 27, Sept. 10 and Sept. 17.
Ford has been working to collect comments on its plans restore the iconic Michigan Central Station building, which the company expects to occupy by 2022, as well as parts of the surrounding Corktown neighborhood.
Ford said the 500,000-square-foot, 18-story train station will anchor a campus for the company's self-driving, electric car and alternative transportation teams, as well as the automaker's partners.
The Dearborn automaker is bringing 2,500 people from its autonomous technology and electrification departments to Corktown; another 2,500 employees are arriving from startups and other partner companies.
The company expects to occupy the long-vacant depot by 2022.
During a community meeting l..

More than $242M awarded for Lexus seat defects

More than $242M awarded for Lexus seat defectsDallas – A Texas jury has awarded more than $242 million to a Dallas-area family who sued Toyota over what they said were defective front seats in their Lexus sedan.
Benjamin and Kristi Reavis alleged defects caused their front seat backs in a September 2016 rear-end collision to collapse on their two young children seated in child safety seats in the back. Their attorney said the 5-year-old daughter and 3-year-old son suffered severe head trauma and other injuries.
The Reavises’ attorney, Frank Branson, said Toyota consciously chose to protect front-seat occupants from crash injuries such as whiplash at the expense of rear-seat passengers.
The Dallas County jury determined Friday that the seats were unreasonably dangerous and Toyota failed to warn of those dangers.
In a statement, Toyota said it sympathized with the Reavises and respects the jury’s decision but believes the injuries resulted from factors specific to the collision, not defects. No decision has been made on an appeal.
Copyright 2018 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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Zero DSR electric motorcycle is wickedly quick

Zero DSR electric motorcycle is wickedly quickBring on the hate mail: I love electric motorcycles.
I love their power, their torque and their stealthy silence. I love their ease of operation and their low cost of maintenance.
Although I am not alone in this, I don’t have a lot of company. Resistance to electric motorcycles is fierce.
Detractors — many of whom have not actually ridden the battery-powered machines — describe themselves as dyed-in-the-wool enthusiasts who live for the roar and rumble of a big internal combustion engine. They love the smell of the gas, the sound of the pipes and the sensation of pulsing vibration between their legs.
But they also have practical objections to electrification. Battery bikes cost too much, recharge too slowly and have insufficient range, they say. Some riders even believe electric motorcycles are more dangerous than their gasoline counterparts, because they don’t make enough noise to be heard by nearby motorists.
For two months this year I used a Zero DSR electric motorcycle as my main commuter vehicle. The experience deepened my appreciation for battery-powered transportation, and my admiration for the Zero line. But it also taught me that electric bikes aren’t for every rider, or for every ride. Even a state-of-the-art bike like the DSR could not satisfy all of a dedicated biker’s needs.
The DSR is Zero’s top model, and the company is right to be proud of it. Wickedly quick off the line, delivering spookily seamless power, the bike feels like a magic carpet ride that violates the laws of thermodynamics.
The electric battery delivers 70 horsepower and 116 pound-feet of torque on a bike that weighs about 450 pounds. That seems high, but the absence of any rotating mass — no pistons, no flywheel, no clutch — makes the bike feel almost weightless when it’s on the move. Zero says the bike will hit a top speed of 102 miles per hour.
Zero has improved its braking and suspension systems, bringing them into line with modern sport bikes. The DSR is fitted with a Bosch ABS that uses J. Juan calipers, and Showa suspension at both ends. The 17-inch rear and 19-inch front wheels wear Pirelli MT-60 tires. The combination makes the DSR feel playful but firmly planted.
Since there is no clutch or gear shift lever, operation is a breeze. Just twist the throttle and go. And because the DSR burns no fuel, requires no lubrication and is driven by a carbon belt instead of a metal chain, there is virtually no maintenance.
Riding without noise, heat or vibration is strangely liberating. Without those things occupying the senses, I feel like I can hear more, see more and even smell more than when I ride a traditional bike.
One night on the DSR I became concerned about a squeaky sound accompanying my ride up a Hollywood canyon road that I’d ridden dozens of times before. I finally pulled over, worried that I had a bad bearing or a defective belt. Only when I stopped did I realize I was hearing frogs and crickets from a nearby creek.
Commuting, I felt confident in traffic and comfortable lane-splitting on the freeway. Somehow the DSR felt lighter, more nimble and even thinner than my other motorcycles — though in reality it is not. I found that, when I needed to run an errand and had the option of the DSR or another bike, I almost invariably chose the DSR. It just seemed simpler, somehow.
The exception? Longer rides. Zero boasts that the DSR, fitted with the optional Power Tank accessory, can go 220 city miles or 110 freeway miles on a single battery charge.
That was not my experience, and will probably not be the experience of anyone who does not ride this kind of bike very conservatively. Though I didn’t drain the battery down to its last bit of juice, my range would have been something more like half what Zero advertises.
Granted, I was really enjoying the terrific torque and acceleration, which meant I was riding at the rate of about 120 miles to the tank, with mixed city and highway riding.
Zero boasts, too, that the DSR, when fitted with the necessary fast-charging hardware, can be refueled in as little as two hours, at the rate of 103 riding miles per charging hour.
Because I was commuting, I didn’t test that. But arriving home in the evening, plugging the DSR into a standard household outlet, I observed recharge rates of about 6 to 8 riding miles per hour. Plugging in overnight, I always got up the next morning to a full tank, with plenty of juice to get me where I needed to go.
But that meant a day ride to Big Bear, or even a spirited run up the Angeles Crest Highway to Newcomb’s Ranch or Wrightwood, was problematic. I could get there all right, but would I find a place to plug in, and how long would it take to recharge sufficiently to get home? I took a gas-powered bike on those jaunts.
Zero puts the cost of charging its electric bikes at $1.50 to $2 per tank, and says some of its machines get the fuel efficiency equivalent of 403 miles per gallon. Studies have shown that the cost of owning and operating an electric motorcycle may make it cheaper than comparable gas-powered bikes.
But the cost of entry is steep. Zero’s least expensive machines start as low as $8,495. The basic DSR starts at $10,995. The model I rode, outfitted with a variety of options, would retail well above that, at just above $19,000, before tax, license and delivery.
Some government incentives would offset that, and could include a federal tax credit of up to $1,500 and a California state rebate of $900.
There will still be those who, until they ride one, will view electric bikes as a passing fad. If so, they’re passing in good company.
BMW, Yamaha and others have put substantial resources behind their electric scooter programs. Alta Motors’ motocross bikes are beating internal combustion machines wherever they’re allowed to compete. And Harley-Davidson, which recently made a substantial investment in Alta, is coming to market with its electric LiveWire superbike and half a dozen other new electric machines.
The future isn’t coming. It’s here.
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