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Former Fiat Chrysler VP pleads guilty in UAW corruption probe

Former Fiat Chrysler Automobiles executive Alphons Iacobelli pleaded guilty on Monday in connection to allegations that he made at least $1.5 million in improper payments to senior union officials, the U.S. attorney's office in Detroit said. Iacobelli, 58, a former Fiat Chrysler vice president of employee relations, was charged in July in U.S. District Court in Detroit with taking part in a conspiracy to pay prohibited money and gifts to United Auto Workers union officials. Sentencing was set for May 29. Iacobelli faces a statutory maximum of eight years in prison, and prosecutors said he will be required to repay $835,000. A lawyer for Iacobelli did not immediately comment on Monday. Iacobelli pleaded guilty to conspiracy to violate the Labor Management Relations Act and to filing a false tax return based on his failure to report hundreds of thousands of dollars in income that he illegally diverted, the government said. Iacobelli reportedly made some lavish purchases with money taken from the UAW-Chrysler National Training Center — a 2013 Ferrari 458 Spider and two solid-gold Mont Blanc pens costing $37,500 apiece. He reportedly sold the sports car at a discount when news broke of the investigation. The government said Iacobelli conspired to make illegal payments in an effort to obtain concessions and advantages for Fiat Chrysler "in the negotiation, implementation and administration of the collective bargaining agreements between FCA and the UAW." Monica Morgan, the wife of former UAW Vice President General Holiefield, who died in March 2015, is also expected to plead guilty, Reuters reported last week, citing a person briefed on the matter. She faces a plea hearing on Feb. 6. Morgan was charged with conspiring with Iacobelli to violate federal labor law. Morgan's lawyer, Steve Fishman, declined comment. Jerome Durden, a former Fiat Chrysler official whom the government charged with conspiring to divert over $4.5 million in UAW training center funds, pleaded guilty in August. The Justice Department has a wide-ranging investigation under way. In November, General Motors and Ford confirmed they were cooperating with the investigation into alleged misspending at UAW union training centers funded by U.S. automakers. It was not clear if Iacobelli is cooperating in the ongoing investigation. General Motors is conducting an internal investigation into the matter. The UAW said in a statement Monday that it is "appalled at these charges.

Buy Ford and GM stock and make 5%

Want to make a five-percent return when 10-year treasuries are paying around two percent? Ford (F) and General Motors (GM) have solid balance sheets, strong cash flow, solid earnings, and growing markets. By all accounts, they are smart investments. But the market is down on these stocks. Why? Some of the stupid excuses include: They are cyclical companies The Detroit 3 have lost 3.5 million in sales since 2000 The world economy is shaky GM recently filed for bankruptcy Their markets have peaked They haven't changed their ways Let's take these criticisms one by one: They Are Cyclical Companies Yes, they are cyclical. Every company is cyclical. Every industry is cyclical. Some more than others, but not every company is immune from swings in the market. Banks used to be 'non-cyclical' leader, not anymore. Airline stocks are just as cyclical as auto stocks, yet they are trading at multiples greater than the auto industry. Why? And what accounts for the irrational stock price for Tesla (TSLA)? At least Ford (F) and General Motors (GM) make money and have positive cash flows. In fact, both companies have a net positive cash position. They have more cash on hand than liabilities. Auto sales in the United States hit a record 17.5 million vehicles in 2015. During the Great Recession, Ford (F) and General Motors (GM) cut their break even points to 10 million vehicles per year. Anything above an annual U.S. volume of 10 million vehicles is profit. And what a profit they make. Sales of Ford's F-150 continues to be the best-selling vehicle in the United States for over 30 years. Detroit 3 Have Lost 3.5 million in Sales Since 2000 Automotive News reports General Motors (GM), Ford (F) and Chrysler (FCA) have lost a combined 3.5 million vehicles sales since 2000. So how can they be making more money? Two big reasons – Fleet Sales and the UAW. Fleet Sales The Detroit 3 used to own car rental companies to keep their factories running. Ford owned Hertz (HTZ), General Motors owned all of National Car Rental and 29 percent of Avis, and Chrysler, the forerunner to Fiat Chrysler (FCA), used to own Thrifty Car Rental and Dollar Rent-A-Car. The Detroit 3 owned these rental companies to have a place to sell their bad product and keep their factories running. These were low margin sales, and in many cases, were money losers for the Detroit 3. They no longer own auto rental companies.

Taking a truly driverless ride in Waymo's Chrysler Pacifica

Today was a first for me: I drove in a fully autonomous vehicle on roads without anyone behind the wheel. They weren't public roads, but they did have intersections, other vehicles, pedestrian traffic, cyclists and more, and the car managed a fairly long route without any human intervention — and without any cause for concern on my part. I've done a lot of self-driving vehicle demos, including in Waymo's own previous-generation Lexus test vehicles, so I wasn't apprehensive about being ferried around in Waymo's Chrysler Pacifica minivan to begin with. But the experience still took me by surprise, in terms of just how freeing it was once it became apparent that the car was handling things all on its own, and would continue to do so safely regardless of what else was going on around it. Waymo's test track at Castle (more on that facility here) included multiple intersections with traffic lights, a roundabout, cars stopped on the shoulder, crossing foot band cycle traffic and more. Even if these were staged, they'd be hard to replicate in exact detail every time, so despite the fact that Waymo clearly had more control here than they would out in the real world, the driving experience was still impressive. In particular, one event stuck with me: A squirrel (or other small rodent, I'm no expert on the fauna of Northern California) darted out quickly in front of the car, before turning back off the road – but the vehicle perceptibly slowed in case it needed to avoid it. Barring an incredibly lifelike animatronic, this isn't something Waymo could've planned for. Regarding how it actually works, once in the vehicle and buckled up, a rider taps a button to start the ride, and then displays mounted on the backs of the front seats show a visualization of what the car's sensors see, but selectively simplified and redesigned to draw focus to things that riders find important, and to reassure them about the system's competence and ability to spot all the key variables on the road. This is essentially the same car driving riders around Chandler, in Phoenix, where the current Waymo pilot is operating. It's still essentially a stock Pacifica van, with a premium trim upgrade, but included features in that vehicle, including the many USB ports for charging located throughout, the dual screens mentioned above on the seat backs, and the rear cabin AC and climate controls all make it particularly well suited to the task of putting the rider first.