Auto Repair In the White House
Bailing out our domestic auto industry is not an easy task. After Congress ran Detroit’s Big Three executives through the mill, admonishing them for the audacity to arrive in corporate jets, they demanded another visit with business plan in hand.
Then after reviewing the plans, the response from Congress was “let’s make automakers commit to: a) keeping the high UAW labor costs, b) building cars that Congress approves of, c) promising not to resist individual state carbon emission initiatives, and d) putting up with a ‘Czar’ to micromanage operations.” Now there’s a recipe for commercial success.
Of course, Congress had to punt the automakers over to the White House, where after a week of deliberation, a solution was reached that nearly no one really likes. Fiscally responsible conservatives are not fond of tapping Troubled Asset Relief Program funds for anything other than the financial institutions they were intended for. A better answer would have been a structured reorganization, according to most on the right side of the isle.
Meanwhile, Democrats who count on labor for getting elected, don’t like the language. Nancy Pelosi complains: “The White House proposal unfortunately singles out workers and clearly puts them at a disadvantage before negotiations have even begun. … [A]ll laws governing fuel efficiency, emissions and improvements in automotive technology must be preserved.” She went on to say that Congress stands ready to work with all parties. That’s reassuring.
Meanwhile, most of the adult population is getting weary of all the billions of dollars tossed around the beltway like party favors. Sure, it’s essential to restart the economy, but most realize that cranking up printing presses to make money has the potential of turning our country into pauper status.
Since all of us have a stake in this game of automaking, how good are our chances of coming out of this without forfeiting our tax dollars? The answer to that question depends upon which automaker we’re talking about and just how soon our economy recovers. Success depends upon at least enough credit available to allow financing of new car sales. And little will happen until a good portion of the general public becomes more optimistic about the future and spends some money.
The forgeign Auto makers with plants here have an edge. You can buy thier cars with zero 0 percent loan from financing overseas. Then the profits go back to Japan and Germany to build up thier Infastructure, schools, and programs. GM cannot get financing. A car loan from GM right now must have almost perfect 700 credit to get a 5% loan. This has got to change for GM to recapture thier market.
The banks alias Citi Bank of America AiG got “Grant Money”. They have stuck it in thier safes and bought other banks, and still will not loan to the Big Three. GM got a loan and will be accountable. We need to get the banks back on line with money for GM and Chrysler so that the recovery can go forward. So the secret to the Big Three’s sucess is really all about the Credit Crisis. And of course no body mentions we had a year of $4.00 a gallon for gas that bankqrupted everybody before the credit crisis even hit. And the gas caught GM with vehicles people used to want with 1.50 gal gas, but then they had to change gears mid-year to make new models in “small” size. Now with 180 billion going back into the economy from the price back down to 1.50 gal gas, this too will help the big Three. More money not going in the tank all year, so that one can again afford a new car payment. And I bet Exion will still be making a healthy profit in two weeks when thier 4th quarter report is made public.
Finally GM Ford and Chrysler have been in business for 100 years. If that is not a good test of reliability, than our country is probably destined for desolve, as it is only a bit over 200 years plus in existance in of itself. GM will be just fine if we can get the banks to loan the money back out they took in, and the lost money on Wall Street from the Unregulated Traders slippery fingers. But that is going to be a very hard “Repo Man” Gig. Too bad we can’t just call a safe cracker and hookup for a Boston Tea Party style Repossesion.
Mr. Douglas:
“Does Washington DC have a clue how Detroit works?”
I’d ask if Detroit has a clue how Detroit works?
Because it’s apparent that it ISN’T working.
And is it REALLY Detroit we’re talking about, or just their white-collar corporate headquarters?
Just how many of their assembly plants are located in Mexico and Canada,(and will presumably be subsidized by the US taxpayer), anyhow?
I find it highly suspicious that the UAW hasn’t been screaming about the Big 3 Maquiladoras to Kingdom Come. It shows that the UAW is perfectly happy to keep the South of the Border plants running…as long as UAW leadership gets it’s cut of our loot, too.
It’s hard to tell when you’re in the middle of it, but I suspect that we’re experiencing a paradigm change…our economy has been based for too long un unsustainable levels of consumer debt, and now the old business models are of questionable value.
For all their moaning about approaching insolvency, I’m still subjected to the Big 3′s advertising budget at least once an hour on any TV channel I tune to…and ads on NFL Sunday aren’t cheap.
You bring up a valid point, though, when describing the pig shampoo that,(usually), issues from Pelosi’s soup-cooler.
Despite all their eco-friendly caterwauling about hybrids and electric cars and low-emissions this and that, there apparently isn’t nearly the market…yet…out there for those kinds of products. If there WAS, they’d have made ‘em.
What’s the best seliing vehicle in America for how many decades? ,(c’mon…it’s not like you HAVEN’T seen the ads enough times to memorize this factoid, is it?).
But given the way WASHINGTON works, they’ll mandate production of “eco-mobiles” anyway…and then blame the Big 2,(or the Big 1), when the only people who will have purchased them will be urban metropolitan area journalists…
Look, if you live in Brooklyn and work in Manhattan, I’d agree that you don’t really need a SUV,(essentially, a 4WD mini-van or station wagon, when you think about it), but if you have a family, and live outside of a public transportation network,(especially where the snow may not get cleared off the roads for a week or so), you DO.
“Bailing out our domestic auto industry is not an easy task. ”
Nor should we. Period. End of UAW story.
Hmmm.
Interesting news:
“In an unusual move, General Motors and the Canadian Auto Workers union reached a tentative agreement on a new collective bargaining contract on May 15, 2008, a full four months before the existing contract was due to expire. As part of the agreement, GM pledged to maintain production at the Oshawa, Ontario pickup truck plant and made other production commitments.
On June 3, 2008, less than three weeks after ratification of the new contract, GM announced that, due to soaring gasoline prices and plummeting truck sales, it would close four additional truck and SUV plants, including the Oshawa pickup plant.[4]
In response, the CAW organized a blockade of the GM of Canada headquarters in Oshawa. The blockade was ended by an Ontario Superior Court order, after 12 days. Further discussions between GM and the CAW resulted in an agreement to compensate workers at the truck plant and additional product commitments for the Oshawa car assembly plant.”
from:
http://en.wikipedia.org/wiki/General_Motors_Canada
The ink’s not even dry on their contract with Canadian unions, and they slam the doors on the factory that they had specifically PROMISED to keep open.
And some people want to bargain with these people?
Can you trust them?
Another item:
“MEXICO CITY – General Motors of Mexico says it will temporarily idle three factories because of the worst auto sales slump in a quarter of a century.
The company says its plant in the central state of Guanajuato will shut down from Dec. 22 to Jan. 7, and its plants in the northern states of San Luis Potosi and Coahuila from Dec. 22 to Jan. 2.”
from:
http://www.startribune.com/business/36205249.html
And what happens after January 7th to justify the resumption of production of the GM Maquiladoras?
Oh, yeah…they get their US taxpayer subsidy.
Riiiiiight.
And meanwhile, back at the UAW Union Hall:
“1. It’s good news that loans have been released to keep America’s auto factories open.
• Good news for workers and their families at automakers, dealers, suppliers and others who are part of the auto industry that emergency bridge loans have been released to help America’s auto companies weather the current financial crisis.
• This will help save millions of jobs, thousands of companies and hundreds of billions of dollars for taxpayers.
• All this could have been lost if one or more automakers were forced into liquidation.”
from:
http://www.uaw.org/auto/12_20_08auto1.cfm
Tell that to the Canadian GM employees at Oshawa.
And remember that Mexican GM workers go back to work after the New Year.
These people are NOT trustworthy.
I couldn’t pass this one up:
“GM is already confidently moving into a bright future. See how GM is a leader in alternative fuel and fuel economy, technology, design, safety and quality”
from:
http://www.gm.com/corporate/
Ah….yup. That they are.
A bright future” of perennial taxpayer subsidy.
For your reading pleasure, the guy I’ve been waiting to hear from:
http://www.bestsyndication.com/?q=20081203_michael_moore_message_big_3_bailout_package.htm
(I didn’t wanna, but I finally got off MY lazy dead *ss and googled it).
The Big 3 bailout is about D.C., not Detroit. The intended results will occur in D.C. Anything that happens elsewhere is secondary.
The bailout is votes for politicians. Canada gave those idiots 4. Million in addition to our 13 billion. I don’t want to bailout these companies I hate what most of Washington is doing to our country I hate what the politicians are doing to Illinois. Thank you Mr Bush and Mr Cheney for protecting our country. The rest of you can go screw yourselves. Our future can only be saved by our Republican Governors such Sanford, Jindal, Palin, Perry, and Pawlenty.
The idea that the Big Three can be fixed is like saying the Titanic could be fixed after it hit the iceberg. The time to fix Detroit was in the past(1970-85) when there was still time. Now its too late. The Big Three are doomed. This is not surprising. In most industries there are only two or three major players and a few niche companies. This was true of the American market when it was protected by tariffs. Hence the Big Three who eliminated other competitors like Packard, Hudson, etc. In a globilized market there will inevitably be only three major firms probably Toyota, Honda and one of the German companies. Giving Detroit taxpayer money is simply throwing it away in a hopeless cause.
Let Detroit secede from the US and become a third world country.
As I see it; These leaches will take blood or money to continue their mugging of the American People because they cannot find another
<addendum;
………..sucker to consume!