Autopia.org - View Single Post - Should the government bail-out include domestic automakers?

askjeffro · 11-11-08, 07:13

Well, normally I would have said no, they shouldn't be bailed out.

Its true that the American makers are burdened with high employee costs relative to foreign makers, and for that reason I would support a limited bailout of the government taking over those retired health plans to free up cash flow for the makers. If they can't survive then, then let them go down. (I'm a Ford guy btw, I bleed blue as they say)

I believe the American makers make quality cars, in fact I know it. The quality is not the reason they are in this difficult situation. They are large volume producers with high worker legacy costs in a downturn which not only zaps their current sales, but bleed the pensions that they have to make the difference up on.

In about 6 months expect to hear a lot more about pensions being the death blow to companies if the market doesn't pick up. (Which it likely won't)

11-11-08, 07:13	#11 (permalink)
askjeffro Registered User askjeffro is offline Join Date: Oct 2008 Posts: 67	Re: Should the government bail-out include domestic automakers? Well, normally I would have said no, they shouldn't be bailed out. Its true that the American makers are burdened with high employee costs relative to foreign makers, and for that reason I would support a limited bailout of the government taking over those retired health plans to free up cash flow for the makers. If they can't survive then, then let them go down. (I'm a Ford guy btw, I bleed blue as they say) I believe the American makers make quality cars, in fact I know it. The quality is not the reason they are in this difficult situation. They are large volume producers with high worker legacy costs in a downturn which not only zaps their current sales, but bleed the pensions that they have to make the difference up on. In about 6 months expect to hear a lot more about pensions being the death blow to companies if the market doesn't pick up. (Which it likely won't)