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Automotive News & Views Do You Favor A Government Loan To The Detroit 3?
3958 messages, Last post on Oct 02, 2009 at 4:52 PM
You are in the Automotive News & Views Forum. Your Hosts are steve_ & claires
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Replying to: gagrice (Nov 24, 2008 5:28 pm) Bought a 2005 GMC hybrid PU in June of 2005 when the family discounts were offered. This truck had lots of nice stuff. MSRP was $36k. I got it after a real haggle for $26k plus TTL. One and a half years later I decided I wanted an SUV and drove the 2007 Denali Yukon. I cannot remember the exact figures. It was over $40k. My PU was perfect and I had added an aluminum roll-top over he bed for $1300. This was the same dealer I bought the truck from. It had 13k highway miles and he offered me $16k in trade. I stood up and told him that was an insult to my intelligence and walked out. I listed it on Craigslist and a fellow from LA came down and gave me $23k cash for the truck. That kind of loss on a PU truck is horrible, and the worst I have ever had. The truck was not as solid as my 1998 Suburban. I did like the Stereo and climate control. That will probably be my last GM vehicle." Let me understand your predicament: You were insulted when they offered you 16K in trade for your obsolete truck. Yet you weren't insulted when you practically "stole" it for 26k with the family pricing and all those discounts and then suckered an LA city slicker into paying 23k for it. A $1300.00 chrome roll bar should increase the trade value another 8k I would guess. Oh, and let's not forget the "highway miles". Just curious, how much better was the gas mileage over the conventional gas truck? 
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Replying to: gagrice (Nov 24, 2008 8:57 pm) Just heard some of a rerun of Obama's press conference today. Sure sounds like he wants to give Detroit some money, just as soon as Detroit can come up with a justification for needing it. |
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Replying to: dave8697 (Nov 24, 2008 3:15 pm) So what's your point with Japan? Are you trying to imply something here?
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| I would favor a loan, not a handout. I feel for the auto workers and have nothing but disdain for the executives of the big three. The writing has been on the wall for decades, not years, decades. I would have to have lots of preconditions before a loan was granted. What is their plan, repayment schedules, etc. | |
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has some pretty good ideas, after you get past the part where he seems to be weeping in his soup for all the unfairnesses (is that a word?!  ) the domestics have had to suffer since WWII. http://www.autoweek.com/article/20081124/FREE/811249987 It's when he invokes the domestics' leadership on E85 that I call foul, but he goes on to promote some new ideas I haven't heard yet that might be a good alternative to a bankruptcy filing. Among them: First, I would invest part of the Troubled Asset Relief Program (TARP) money in the automakers' captive finance companies at competitive rates securitized by the finance or lease paper. This will dramatically reduce incentive costs for the Detroit Three. It also will benefit consumers who are finding it difficult to get financing, even with good credit scores. Second, I would enable the Detroit makers to draw against the $25 billion immediately to cover all investments they have made to date in green technology. That includes hybrid development, plug-in hybrids, EcoBoost, fuel cells and E85. This will keep them going until the next stage. Third, take $250 billion of the TARP money that the current administration will not spend and invest it in the new Industrial Bank of America. This bank will have the mandate to rebuild our manufacturing base, including our auto industry, with the progressive application of green technology. It also will rebuild our power grid with solar, wind and wave technology; it has to be renewable. I especially like the first and third points: a major financing base to promote development of alt power technology, as well as provide reliable, widely available credit for the industry and customers alike (this last is particularly crucial for GM now that it has lost control of GMAC). And the second point makes pulling the already approved $25 billion forward to repay them for investments they have already made seem almost sensible. I would imagine GM's cumulative investment in the Volt is substantial by this point. And Chrysler's in electric cars? And Ford with its own hybrids and EcoBoost? After the three main points the author goes off on a flight of fancy about how he would manage the restructuring of healthcare in America - yes that one is mostly pie in the sky. Fixing healthcare for the domestics and EVERYONE aint gonna be as easy as all that. But then he writes this: Look at selling off certain brands, such as Volvo and Saab. Close Hummer. Buick is a highly successful brand in China, so try to get investment from China in that brand. Develop specific consumer missions for all of the brands; this will help sales in brand-conscious areas such as California And maybe there could be a couple more brands gone between GM and Ford... He makes an emotional appeal for supporting and rejuvenating the manufacturing sector in America, starting with the carmakers. Ultimately, one of the things one must decide in this whole bailout thing is how much one values domestic manufacturing in general, and whether it is worth spending a TON of money trying to save it. But will a cash infusion save it? Global market forces with regard to labor costs dictate that the domestics will continue migrating all their production to Mexico and other low-cost Central American locales, don't they? I think it is inevitable unless they can somehow eliminate the UAW from existence entirely. |
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Replying to: nippononly (Nov 24, 2008 11:05 pm) I have a problem with the last part of this statement. Mr. Wagoner even mentioned it during the grilling , I mean hearings. GM won't finance anyone with a score less than 700. Since when did they become so selective? The other part is I don't know who is having problems getting a loan with a good credit rating. Two of my sons just bought cars in the last month. One a loaded import made by Nissan's high line company and the other bought a pre-owned 7 year old sports car. Neither had a problem getting a loan. Both have excellent credit and the one that bought the used vehicle is only 23 years old but has a FICO score of 751, is about to graduate from college, has a full time job and pays his bills on time. His older brother ain't doing too bad either. Score is way over 7xx also and he is very fiscally responsible. So my point is the money is there for those that qualify for it.
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Replying to: rogeliov (Nov 24, 2008 11:25 pm) As long as we're talking about the money being there ONLY if you qualify for it, I'm on board. But we have to stop loaning money to people who cannot pay it back. There are always going to be changing circumstances that cause defaults on some loans. We don't have to increase that number by creating loans that have little or no chance of being paid off from the outset. |
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Replying to: circlew (Nov 24, 2008 2:00 pm) |
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If GM doesn't get a bailout - NOBODY SHOULD!!! Not Citi, not AIG, not ANYBODY!!! Let 'em all go down in flames! You want cold hard cruel capitalism? Let the market decide!
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Replying to: lemko (Nov 25, 2008 6:02 am) What kind of companies do these guys run that they can't afford to fly to DC?  Speaking of images, GM ended its 9 year endorsement deal, estimated at $7.5 per year, with Tiger Woods. Mark Steinberg, Woods's agent, said Woods had been impressed with the way Buick transformed its image, doing away with stodgier models and releasing more updated cars. “We saw that it was going to work,” Steinberg said. “We saw what Buick wanted to do with their brand.” Saw that it was going to work? Buick sales in the US were down 54% from 2000 to 2007 and the average age of a Buick sedan purchaser is 66. Perhaps someone will impulse purchase a $200 pair of sneakers based on a celebrity endorsement. Not so sure it works that way with a $30,000 vehicle. |
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