Last post on Dec 22, 2012 at 8:06 PM
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#3991 of 4024 Ford is my 1st choice domestically
Dec 01, 2011 (1:50 pm)
I'll be waiting to hear more about the 2013 Ford Escape. The Escape will be made here in the U.S. All else being equal, give Ford the business. Let Ford's market-share become #1, and let GM and Chrysler sell their operations to someone worthy.
Since GM doesn't have to pay income tax for years, let Ford profit more, and the U.S. government will collect more in taxes, getting some of that bailout $ back.
#3992 of 4024 Re: Ford is my 1st choice domestically [kernick]
Dec 02, 2011 (10:20 am)
All else being equal, give Ford the business.
That's my take as well. I traded my Sebring in for a Ranger and when it comes time to replace that, I'll be looking at another Ranger or the Explorer Sport Trac before anything else. My 08 Ranger with 52K miles has been flawless so far.
Kudos to Ford for not taking the bailout.
#3993 of 4024 taking credit, revisionist history or jab at Mitt?
by steve_ HOST
Feb 07, 2012 (6:51 am)
"Former U.S. President George W. Bush told car dealers gathered at a convention in Las Vegas he “didn’t want to gamble” with a depression in defending the loans he gave to General Motors Corp. and Chrysler LLC.
“I didn’t want there to be 21 percent unemployment,” Bush said in a speech yesterday to cap the annual National Automobile Dealers Association convention, attended by more than 20,000 people. “I didn’t want to gamble. I didn’t want history to look back and say, ‘Bush could have done something but chose not to do it.’ And so I said, ‘no depression.’”
Bush Tells Dealers He Avoided ‘Gamble’ in Bailing Out Automakers (Bloomberg)
#3994 of 4024 Re: taking credit, revisionist history or jab at Mitt? [steve_]
Feb 07, 2012 (8:52 am)
President Bush could be right, or wrong, since we'll never know what would have happened had the bailout not occurred. We can only speculate. I'm generally opposed to government bailouts, and without the advantage of forsight, favored letting our bankruptcy laws work. One thing's for sure, and that is that the wisdom of the Detroit two bailout will be argued for decades, with no definitive conclusion.
#3995 of 4024 Re: taking credit, revisionist history or jab at Mitt? [hpmctorque]
by steve_ HOST
Feb 07, 2012 (9:16 am)
Well, GM and Chrysler did go through bankruptcy, and like a lot of other bankruptcies, it was pre-planned and pre-funded. Main difference was that the funding was public.
Ford could have done the same thing using their private funding when they hocked the farm, and gained the benefit of being able to cancel and renegotiate union and dealer contracts. Might bite them in the long run.
#3996 of 4024 Re: taking credit, revisionist history or jab at Mitt? [hpmctorque]
Feb 07, 2012 (12:19 pm)
Personally, I admire George W for his candor. When you are the leader sometimes you've got to make the pragmatic decision rather than theoretical or idealogical calls. A lot of history indicates that Herbert Hoover was too stubborn to his ideals and that was a major contributor to the financial collapse and resulting depression.
I don't live in an auto state, but I always felt some of the Senators like Corker and Shelby were being a bit disingenuous in their vehement bailout opposition. First, it's easy to take an idealogical stand when you aren't ultimately responsible for the decision. But let's be realistic for a moment . Southern states are the primary location of the transplants thanks in at least some large part to the huge tax and financial incentives they provided. Yet these same politicians opposed government monies for D3. It's fine if Alabama or Tennessee government monies are used for transplants, but its not alright if anything is used for Detroit. Seems to me that D3 failures mean big transplants rewards, so the southern states would then reap a windfall. Just another sad example of Washington politicians focused on their narrow, parochial self interest rather than the overall good of the country.
Chrysler is hiring a number on new "American" employees after survival, but I agree with you HM, there will never be a definitive conclusion because all the political parties do is argue and manipulate.
#3997 of 4024 Re: taking credit, revisionist history or jab at Mitt? [steve_]
Feb 07, 2012 (12:24 pm)
Steve, if you look at the timing of all of this the problem is that banks and financial instituions were not lending or investing much at the time. I very much doubt Ford could have obtained any significant private funding then, and there is no way GM or C could have. I doubt George W or his Treasury Secretary Paulson were too happy at the time, but from a practical standpoint there really wasn't a private sector solution available at the time. It was really kind of black and white - gov money or failure. The latter meant no more GM or C at that moment in history.
#3998 of 4024 Re: taking credit, revisionist history or jab at Mitt? [berri]
Feb 07, 2012 (12:35 pm)
I agree with all that. IMO Bush made the right call. I think if nothing was done, the situation would be much worse right now. The future isn't golden yet, but it could be worse.
I also find it hilarious when certain politicos who subsidize transplants to come to their states, transplants who themselves benefit from endless gifts given by their home countries and expect to compete here with complete access, then cry when we give similar aid to domestic industry. Like you say, domestic failure equals win for the competition who have been in a defacto manner bribed to locate to certain states.
#3999 of 4024 Re: taking credit, revisionist history or jab at Mitt? [berri]
by steve_ HOST
Feb 07, 2012 (1:47 pm)
Well the dates do run together.
In 2008 Ford mortgaged all assets to raise $23.4 billion cash in secured credit lines, in order to finance product development during restructuring through 2009. In December that same year they asked Washington for a $9 billion line of credit. (per Wiki and PBS).
Remember too that Cerberus Capital Management owned Chrysler at the time; I think they had plenty of money but didn't want to throw good money after bad. Bad being Nardelli imho.
I don't think Chrysler had the book value to do what Ford did; GM, maybe.
#4000 of 4024 Re: taking credit, revisionist history or jab at Mitt? [steve_]
Feb 07, 2012 (2:04 pm)
The Ford mortgage took place before the BK's, but they do kind of run together a bit. However, that mortgage effort would have further precluded Ford's ability to restructure under a subsequent BK. I think the bad part of the GM and C BK was the gov blatantly favoring the UAW over the bondholders. I understand they were trying to help the manufacturers in offloading health insurance during the restructure, but it was still bad precedence that may arise in the future affecting other company financing and restructe efforts. The gov just added a new risk variable into these sort of things. As for Nardelli, you are probably more charitable toward him than Home Depot! I think he was rather irrelevant to the C BK because I feel the only reason they got bailed out was that many of the Ceberus movers and shakers were previously key political players from both political parties. C was in no way as essential to the economy at that point in time as GM.