Gojirra99

By DANNY HAKIM

Published: June 7, 2005


ETROIT, June 6 - The future of Visionary Vehicles, the upstart company that announced in January it would bring the first Chinese-made automobiles to the United States by 2007, appears to be in some doubt.

Two top executives said in interviews on Monday that they had recently left Visionary, a privately held company based in New York, after only short stays. After just three months on the job, Pierre Gagnon, the president and chief operating officer and the No. 2 executive at Visionary, said Monday that he had resigned that day. But he added that he had had a falling out six weeks ago with the head of Visionary, Malcolm Bricklin.

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Mr. Bricklin is the brash businessman - often likened to an automotive version of P. T. Barnum - who first brought the Yugo and Subaru brands to the United States.

"Malcolm reneged on several agreements that affect my trust and willingness to be part of his organization," said Mr. Gagnon, formerly the top North American executive of Mitsubishi. "I still have high hopes for what it might be possible for Visionary Vehicles to achieve and wish him the best."

Mr. Gagnon said that "many of the commitments he reneged on revolved around financial issues," but declined to elaborate.

The second executive to leave was Andrew Stewart, who worked with Mr. Gagnon at Saturn and Mitsubishi and was the vice president of franchise development at Visionary. He said he left at the end of April and returned to Mitsubishi.

"I left one month after I started," Mr. Stewart said. "It became very, very clear, as much as I believe in what he's trying to do, it became clear he's not able to fulfill the promises necessary to create a viable company.

"The man doesn't have any money that I could see," he added. "He doesn't pay his employees on a regular basis, he doesn't reimburse expenses very well."

In an interview Monday evening, Mr. Bricklin disputed the men's contentions. He said that his company "was well funded" and that he had "terminated" Mr. Gagnon two months ago and had not paid him since.

"We realized he was not start-up material," Mr. Bricklin said. "He didn't fit and we didn't announce it, and he was not supposed to announce it, until we worked out something in an advisory role."

He said that Mr. Stewart had been hired by Mr. Gagnon and added that he had only met Mr. Stewart briefly before he left the company.

Mr. Bricklin has received a wave of press coverage in recent months after his promise to bring 250,000 vehicles made by the fledgling Chinese automaker Chery Automotive to the United States by 2007, and even to deliver Lexus-level quality.

The claims have been met with wide skepticism from auto executives, as well as with concern that any influx of inexpensive Chinese-made cars could start a new price battle in the highly competitive United States market.

General Motors is currently in a legal dispute with Chery over claims that the Chinese company copied the design of one of G.M.'s cars sold in China. G.M. has also threatened to sue the company if it brings the Chery name to the United States, saying it is too close to G.M.'s Chevy brand.

Mr. Gagnon and Mr. Stewart, speaking in separate interviews, said they were concerned about the ability of Visionary to deliver on Mr. Bricklin's promises.

"One of the risks is definitely quality in any start-up, and it's difficult to commit to Lexus-type quality with a five-year-old company, and by 2007 they'll be five years old," Mr. Gagnon said of Chery.

Mr. Bricklin said that neither of the men had been with the company long enough to visit Chery's factory in China to make a judgment.

Both Mr. Gagnon and Mr. Stewart said they still expected that cars from Chery would eventually make their way to the United States, though they could not say when.

"I think it's 90-plus percent that Chery automobiles will make it to the United States, and 99 percent that it won't happen with Malcolm Bricklin," Mr. Stewart said. "I wish them the best."

Mr. Bricklin's plans call for a network of 250 dealers around the country - and for those dealers to put up a substantial amount of Visionary's financing.

They are being asked to invest $2 million to $4 million in Visionary, Mr. Bricklin said. He added that he had backed off from original plans to require dealers to commit another $8 million to $10 million to build palatial showrooms with outdoor movie screens and test tracks.

Mr. Gagnon said, "Successful dealers make even larger investments, but given the risk associated with any new venture, this is an investment that they are not used to making."

Automotive News, a trade publication, reported Monday morning that Visionary had yet to sign a single dealer. Asked about the report, Mr. Gagnon said, "My understanding is that no dealers have signed as of yet."

But when asked if he had signed any dealers, Mr. Bricklin said, "The answer is yes; the number is what you're not going to get."

He said an advertisement would run in Automotive News in two weeks that would reveal the number. "I think everybody will be surprised."

Mr. Gagnon and Mr. Stewart said that Mr. Bricklin had canceled a plan to open a Visionary office on the West Coast, where the North American operations of all the Asian automakers - those of Toyota, Honda and Nissan - are based.

"When he changed his mind on that commitment, I became concerned about my future involvement," Mr. Gagnon said. "All of the kind of people I was trying to recruit were located on the West Coast, so that became an issue."

Mr. Gagnon left Mitsubishi in 2003 amid scandals in Japan and trouble in the United States with high defaults stemming from aggressive lending to buyers with poor credit. He said he was becoming the chief executive of a small California start-up that sweeps away allergens from homes and buildings.

source : NYtimes

mmarshall

This is nonsense and a frivolus case if I ever saw one......Chery sounding like Chevy. The GM marketing people and lawyers need to get a life. This lawsuit should not only be thrown out of court , but GM should pay a DOUBLE fine on top of it.......one to the court for wasting their time and one to Bricklin for wasting HIS.

Now...to Bricklin: He's going to deliver Lexus-like quality at sub-10K prices? We'll see. Note, though, that it is amazing what Hyundai / Kia have been able to do the last several years at low prices. We'll know when we see them...and........ trust me.........I WILL look at them.

videcormeum

I generally agree with you about the suit. It's pretty frivolous. But Chinese companies ARE notorious for copying (to the best of their respective abilities) other companies' designs.

As far as the cars go ... I too will believe it when I see it. Who's supplying them with materials at those prices? Other, equally inexperienced, Chinese firms?

Please - it'll take them decades to catch Toyota/Lexus in quality and engineering precision.

M.

Vegassc400

Chery has been building cars for almost 9 years. Although not a seasoned automaker like GM or Toyota, I'd hesitate to call them inexperienced.

mmarshall

Yes, Vegas...I agree. What I was saying, though, is that one cannot just advertise Lexus quality with his/her mouth.....you have to deliver. I have seen and heard this kind of empty talk too many times in the past.....Lee Iacocca, Roger Smith, Bob Stempel, and others like them who walked around sounding like a s - - t salesman with a mouth full of samples. Iacocca, (for those of you who remember him) especially, was a master of this kind of stuff despite the good that he did previously...such as giving us the original Mustang in 1964 when he was at Ford.

So...we'll give Bricklin another chance. Let's wish him luck this time.... and after all, look what a good product Subaru builds today..... you can thank Bricklin for the fact that they are even here to start with.