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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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about domestically made vehicles are beginning to surface in here, eh? They are really coming out of the woodwork now. But in a sense this discussion is not even about what the domestics have done in the past. It is about whether there is any way in which they could totally remake themselves in order to be globally competitive. And whether they could do so fast enough. There ARE good arguments for subsidizing a domestic manufacturing concern, as much of the world does. And as manufacturing concerns go, automobiles is a big one. I still say the bankruptcy court is the only way these companies can effect the needed changes quickly enough. It should be possible to support them on the back end, as they emerge from this reorganization. THAT would be money well spent. I guess what I am saying is, their current slow spiral to death guarantees the death at the end. They need to make a sudden and dramatic set of changes all at once to ensure their future. So, bankruptcy now, bailout money later when it can really help. I no longer believe that GM's turnaround plan, as a for instance, would produce any profits for them before the middle of the next decade, and that's too far away to be useful. The other two are pretty much in the same boat with their turnaround plans. I saw in a headline that Gettelfinger is beginning to see sense, and one of the first concessions the UAW might be willing to make is the elimination of the Jobs Bank. Well yeah Ron, that's the big "DUH!". What else have you got? If all the people involved would just see sense, accept reality, and reduce their compensations and benefits to industry norms (including executives), 2 of the domestics would probably be OK without either a bankruptcy OR a bailout. GM would still be in trouble because of excessive dealers and brands - harder to eliminate. Use a fraction of the bailout money to kill 4000 or 5000 GM dealers and about four brands (Oldsmobile cost, what, a billion $?), and GM could be in very good shape with the other items in place that I mentioned above. |
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Replying to: nippononly (Nov 25, 2008 3:25 pm) My biggest fear is that the Congress will end up giving the bailout money without strong enough concessions/restructuring, and our tax money goes down the drain with Detroit 3 failures just postponed 6-12 months.
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Replying to: nippononly (Nov 25, 2008 3:25 pm) I think that Chrysler should be excluded from any bailout monies. It is essentially DOA right now and there is nothing in the product line which suggests that it has any future. A couple of Jeep nameplates and very reduced minivan & RAM volumes are the only assets of any value IMO. It will be a shame that the Cummins franchise will have to go away. GM has several potentially good assets that can make money when freeded from its 20th Century labor mistakes. Cadillac is worthwhile in NA. Silverado is solid but it has to be stuctured to be profitable in reduced volumes. The lambda crossovers are solid but 4 is too many The Malibu is very competitive, it needs to be grown. The Corvette. The 2-Mode hybrids are every bit as good as the other three players if only they had been brought to market 5 yrs earlier. The Volt and the E-Flex technology needs to be kept in order to help advance us into the next decade. The Aveo is very mediocre but it does serve a purpose. It needs to be updated soon. The Cruze from Europe and Asia needs to replace the Cobalt yesterday. The HHR serves a good purpose. OTOH all the following should be killed off... all BOF SUVs big and midsized; ditto the ColoCanyon; ditto GMC, Buick in NA, Pontiac, Saab and Saturn franchises; GM's market share gets cut to 17-18% but it's a solid profitable segment that can make $Billions with the proper controls. Ford IMO is best positioned but it too has dead limbs that need pruning namely Lincoln and Mercury and all the dealers associated with them. The Ford name should be the sole focus. It's solid profitable assets that are worth keeping in NA are.. ..the F-Series trucks obviously but in much reduced volume; ..the Edge and the Escape...both should have hybrid options ..the Fusion with its hybrid option ..the Eco-boost technology for the future ..the Mustang ..The Focus or whichever Euro-model replaces it. ..Volvo possibly Ford's marketshare gets cut to 7-8% but this too is rock solid. Flexible work rules or an actual non-union workplace may be a necessity for both of them.
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Replying to: gagrice (Nov 24, 2008 5:28 pm) wow you sure took a huge loss on that that GMC, $3000. Just out of curiosity how much do you think your sequoia would be worth now? do you think you would only lose $3000 on that gas pig?
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Replying to: tlong (Nov 25, 2008 3:44 pm) I think probably most everyone on these boards has had a bad experience with something from Detroit, particularly if it was from the 70's through 90's. They weren't too customer focused then, and I don't think they still come anywhere near Honda in stepping up to the plate. If you screw up and try to make amends, people will usually forgive you. But if you stiff a customer they have long memories. |
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Replying to: kdhspyder (Nov 25, 2008 4:09 pm) I think that Chrysler should be excluded from any bailout monies. Definitely a bailout should be banned; if money is loaned to Chrysler, I hope they have the sense to make Cerebus responsible for paying the money back, if Chrysler blows thru the $ and then fails. In fact since Chrysler is private, I would think that we should hold to the fact that Chrysler should loan the money from Cerebus. But at least a loan to Chrysler, because of Cerebus, has more chance of getting paid back if written correctly, then a loan to Ford or GM. Or Cerebus should sell Chrysler for whatever it can get. Let Cerebus's owners take the loss, not the taxpayer!
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Replying to: maple2 (Nov 25, 2008 4:22 pm) I only see one like mine for sale within 200 miles. They are asking $2000 less than I paid new for mine a year ago. So to answer your question I would probably accept a $3000 loss if I found a diesel SUV I like that is better than the Sequoia. Right now the only ones on my list are the BMW X5d and the Mercedes GL & ML320 CDI. Oh mine has the NAV and Entertainment which the one listed does not have. Ask me if I am worried. With gas under $2 I would not hesitate going on a long trip with the Sequoia. And yes it is a gas guzzling pig. What real high mileage SUV options do Americans have? Looks like in a few months it will be fewer. Not that GM or Ford has anything I want at present. I would consider an Expedition with a small diesel engine. |
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Replying to: nippononly (Nov 25, 2008 3:25 pm) Regards, OW
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Replying to: kernick (Nov 25, 2008 5:04 pm) You can't blame them for lining up at the trough with the other two. Bailouts are not really loans. They are giving OUR money to keep these companies afloat. We are also loaning TRILLIONS to banks to keep them going. I am surprised the printing presses are not worn out. |
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Replying to: kdhspyder (Nov 25, 2008 11:27 am) |
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