Should the government bail-out include domestic automakers?

[topnotchtouch]

Exactly; it`s amazing how the Non "Big 3" are doing just fine in the US while the "Big 3" are crippled. Pay cuts need to happen NOW not next week not next month, not next year, like YESTERDAY. If that means they work for $20 an hour do it, and when they are back on there feet increase the pay. I`d take $20 over $0 that`s for damn sure.

I don`t think I would say that the foreign manufacturer`s are doing "just fine"



Detroit Is Tanking, But Toyota`s in Trouble, Too | Autopia from Wired.com



These economic issues are by no means confined to the US and without the current economic crisis it is likely that the big 3 could continue to limp along as they have for years. The one possibly good thing about this mess is that it might result in a leaner more efficient US Auto industry if they can get rid of the dead weight. I personally think they should just go ahead and declare bankruptcy and focus on restructuring....

[Lenny]

Simple numbers: "Our model estimated that a complete shutdown of the Big 3 U.S. production would have a major impact on teh U.S. economy in terms of lost wages, reductions in social security receipts, personal income tax paid, and an incres in transfer payments"



"the government stands to lose on the level of $60 billion in the first year alone, and the 3 year total is well over $156 billion"



Hmm, provide a $25 billion BRIDGE LOAN or spend $156 billion.....seems simple to me!!!



Read the full report



http://www.cargroup.org/documents/CA...ember42008.pdf

No kidding. Too bad so many minds are closed to this. A lot of keyboard jockeys that think they know better than everyone else.

[wytstang]

They`re in a better position then the "Big 3" that`s for sure.

[topnotchtouch]

They`re in a better position then the "Big 3" that`s for sure.

That`s for certain, they were in a better position beforehand as well

[wytstang]

Hmm, provide a $25 billion BRIDGE LOAN or spend $156 billion.....seems simple to me!!!

Well it might be $25 or it might be $50 billion, it`s not clear how much they are going to give yet. Again why are we giving companies help when noting internally is going to change? How are they going to repay this "loan" by producing cars no one wants? They have to retool to compete with Toyo and the like. They don`t have the money for that either.

[Deep Gloss Auto Salon]

It amazes me how people make statements when they have little to no knowledge of what they speak and OUTDATED data

They employ ridiculously high priced laborers that use ridiculous unions. This was bound to happen, there is no excuse. I say if they have managed to build junk cars and not expand, let them go under. This is the problem with the bailout proposed for automakers. .

Wrongo #1) Domestic implants and big three union workers make equivalent wages,... in 2009 the wages will be even more in favor for the big three



Wrongo #2) Quality of domestic vehicles has been on a steady improvement (refer to JD chart posted earlier in this thread



Wrongo #4) This is not a bailout, it is A LOAN.. JUST LIKE what was given to Chrysler years ago and I feel this needs to be repeated... OUR GOVERNMENT MADE NEARLY $500 MILLION OFF THE LOAN TO CHRYSLER

Spending trillions on an ailing economy with no hope of recovery is just greasing the skids. We will simply hit the wall faster than ever.

No hope for recovery??? Please elabortate on where are you getting your data from??? All reports/analysis I have access to tell a very different story

Exactly; it`s amazing how the Non "Big 3" are doing just fine in the US while the "Big 3" are crippled. Pay cuts need to happen NOW not next week not next month, not next year, like YESTERDAY. If that means they work for $20 an hour do it, and when they are back on there feet increase the pay. I`d take $20 over $0 that`s for damn sure.

Please understand, assembly workers for domestic and domestic transplants are now basically the same... the domestics will get even more leverage next year due to new labor contracts... What the implants have on thier side is they do not have decades of retiree`s to support...... And for the record, Non Big Three OEM`s are not doing just fine... Have you read any of their financials lately???

[jfelbab]

I fully expect to see GM only selling Chevy and Caddy plus a truck line, perhaps GMC. I don`t see Buick and Pontiac in their future. Ford and Mercury may also need to get rid of model overlap. I don`t expect to see Chrysler being around. This retrenching needs to happen yesterday. This may be good for the us in the long haul.



In case you were interested, in 2007, Toyota made over $700 per vehicle while GM, Ford and Chrysler lost $729, $1467 and $412 per vehicle respectively. This was before the credit crisis. So tell me why we should pour money into them when they were not profitable even before this crisis. How would this bailout make them profitable? Unless they get new leadership, new labor contracts and a total reorganization, it is not a bailout. It is just delaying the demise.



The credit crisis has affected sales of all major ticket items, not just automobiles. There is no end in sight to those lining up for a handout. Now several state governments are lining up with their hands out. Next week it will be the airplane manufacturers, then the boat builders, then home builders, then the heavy construction industry, then the farmers, etc. The problem is that the money we are doling out is not ours. It is our children`s and grandchildren`s. This debt growth is unsustainable. Sooner or later our debtors will foreclose on us. We have a problem that we can`t spend our way out of.

[MSOsr]

Aren`t the Nissan and Toyota plants in Tennessee or wherever non-union? Are autoworkers so scarce that they have to be paid more in retirement than a lot of gainfully employed people make?



How does GM sell more cars around the world than anybody and still go out of business?



If the government loans the money, someone not involved in being paid by the Big 3 (such as a bankruptcy trustee) needs to approve contracts signed by the Big 3. How many of its contracts could GM have gotten an outsider financial expert to sign off on as being "good deals for the company"?



When you sell more of your product than anyone else, but the others make money and you don`t, you`ve done a pretty poor job of managing your operation.



Mike

[Inzane]

I don`t see Buick and Pontiac in their future.

GOOD!



The only half-decent products to have come out of Pontiac in the last 10+ years are from overseas divisions (re: GTO, Solstice). Go figure.

[Deep Gloss Auto Salon]

In case you were interested, in 2007, Toyota made over $700 per vehicle while GM, Ford and Chrysler lost $729, $1467 and $412 per vehicle respectively. This was before the credit crisis. So tell me why we should pour money into them when they were not profitable even before this crisis. How would this bailout make them profitable? Unless they get new leadership, new labor contracts and a total reorganization, it is not a bailout. It is just delaying the demise.

Once again, OUTDATED OBSOLETE DATA... This is now a non issue... New labor contracts have been made....

[jfelbab]

Once again, OUTDATED OBSOLETE DATA... This is now a non issue... New labor contracts have been made....

You have more current data on how much the big three is making/losing per vehicle? If so, post it. The data I cited were reported in the news today.



I never said that GM`s labor contract was the reason for their inability to turn a profit on their cars. Is that your assumption?



They have pension obligations, excessive management, too many high paid chiefs, poor organization, too many competing models, and a host of issues driving the cost up.

[Lenny]

You have more current data on how much the big three is making/losing per vehicle? If so, post it. The data I cited were reported in the news today.



I never said that GM`s labor contract was the reason for their inability to turn a profit on their cars. Is that your assumption?



They have pension obligations, excessive management, too many high paid chiefs, poor organization, too many competing models, and a host of issues driving the cost up.

I`m sorry to say this, but "today`s news" has been full of inaccuracies.



Last year, Toyota factory employees made more money than their UAW counterparts, link here. Honda, Nissan, BMW, and Mercedes employees are comparable to the Detroit 3. Their benefits are also comparable, except for the retirement programs, which any new UAW represented employees, as new ones come in to replace the retiring workers, are no longer eligible for. New contract with the Detroit 3 and the UAW eliminated al the non-manufacturing jobs, and they are now outsourced to lower cost vendors. This includes all shipping and receiving, material handling - including all forklift operations and overhead crane operation, janitorial, exterior building maintenance and landscaping, and the spare machine parts/nonproduction crib. All of those jobs are now in the hands of temp agencies and contractors at Ford and Chrysler, and in the hands of half-pay employees at GM. Plus there are whole manufacturing operations located in the assembly plants that are in the hands of low cost contractors. Link Here and link here



All the transplant automakers in the USA pay everyone, including their execs, comparable to the Detroit automakers.



GM, Ford, and Chrysler fought the regulations alone? And everyone embraced them? Baloney. On emission, safety, and fuel economy, Toyota and Nissan were standing shoulder-to-shoulder with Detroit opposing them, especially the fuel economy increases that were passed last year.Link Here. Honda was lobbying separately, and fighting much of them as well. All you armchair quarterback critics act like the Detroit automakers march in lockstep together opposing the regulations and the non-Detroit automakers happily accept them, and nothing could be further from the truth. First company to file written objections to this years increase in fuel economy standards, filed on record in the Federal Registry, was BMW. See Link for article



Got news for you - the same thing is happening in Europe. European union has sharply increased emission standards, and every European automaker, led by Daimler and BMW, are complaining up a storm, fighting them tooth and nail. Link Here



Don`t want to get into a pissing contest, but is there any other misconceptions on the auto industry that people need updating on??

[Inzane]

Got news for you - the same thing is happening in Europe. European union has sharply increased emission standards, and every European automaker, led by Daimler and BMW, are complaining up a storm, fighting them tooth and nail. Link Here

The EU`s proposed CO2 limits they are trying to impose are RETARDED!



Carbon DIOXIDE is a clean, odorless, non-toxic NATURAL byproduct of combustion.



Sigh........

[imported_RedlineIRL]

It pisses me off that most Americans are blind to this phenomenon.

It pisses me off that most Americans think that it`s ok to let the US auto industry go under, and with it will have no affect on them at all. It pisses me off that most Americans didn`t think twice or have any objections on a basically no strings attached bailout for Wall Street and the financial firms, but yet when our US auto industry is asking for a LOAN people are all against and thinking that that it`s a bad thing. It pisses me off that most people seem to not be concerned with an industry that is the economic backbone of our contry.

[jfelbab]

I`m sorry to say this, but "today`s news" has been full of inaccuracies.



Last year, Toyota factory employees made more money than their UAW counterparts, link here. Honda, Nissan, BMW, and Mercedes employees are comparable to the Detroit 3. Their benefits are also comparable, except for the retirement programs, which any new UAW represented employees, as new ones come in to replace the retiring workers, are no longer eligible for. New contract with the Detroit 3 and the UAW eliminated al the non-manufacturing jobs, and they are now outsourced to lower cost vendors. This includes all shipping and receiving, material handling - including all forklift operations and overhead crane operation, janitorial, exterior building maintenance and landscaping, and the spare machine parts/nonproduction crib. All of those jobs are now in the hands of temp agencies and contractors at Ford and Chrysler, and in the hands of half-pay employees at GM. Plus there are whole manufacturing operations located in the assembly plants that are in the hands of low cost contractors. Link Here and link here



All the transplant automakers in the USA pay everyone, including their execs, comparable to the Detroit automakers.



GM, Ford, and Chrysler fought the regulations alone? And everyone embraced them? Baloney. On emission, safety, and fuel economy, Toyota and Nissan were standing shoulder-to-shoulder with Detroit opposing them, especially the fuel economy increases that were passed last year.Link Here. Honda was lobbying separately, and fighting much of them as well. All you armchair quarterback critics act like the Detroit automakers march in lockstep together opposing the regulations and the non-Detroit automakers happily accept them, and nothing could be further from the truth. First company to file written objections to this years increase in fuel economy standards, filed on record in the Federal Registry, was BMW. See Link for article



Got news for you - the same thing is happening in Europe. European union has sharply increased emission standards, and every European automaker, led by Daimler and BMW, are complaining up a storm, fighting them tooth and nail. Link Here



Don`t want to get into a pissing contest, but is there any other misconceptions on the auto industry that people need updating on??

Sure, this one was posted on Sunday:





What do you account to the clear failure of the big three to make money on their vehicles?



I also read that Rick Wagoner of GM got a 64% salary increase for GM`s great 2007 performance of a $39 Billion loss.



Here it is:

Wagoner`s compensation rose from about $9.57 million in 2006 to $15.7 million in 2007, a 64% increase.



Fritz Henderson, who was promoted to president and chief operating officer in March, received compensation of about $9.3 million in 2007, up from about $5.1 million in 2006.



Vice Chairman Bob Lutz`s compensation rose to about $9 million in 2007, from about $5.1 million in 2006.

Not just sour grapes at GM as Ford carries a bag of suck too.

Ford Chief Executive Alan Mulally had earned more than $22 million in 2007, drew a sharp rebuke from the UAW as excessive, given concessions UAW members had agreed to in the 2007 contract. This from Ford, which posted a $2.7 billion loss in 2007.

Hard to understand that companies who are performing poorly give their chiefs exorbitant salaries.



Now I didn`t bring up any of that baggage you posted about about the UAW and the CAFE standards. My point was simply that the big three are losing money on every car and their Asian big three competitors are clearly not. These are published and verifiable numbers. I could find no more current numbers for profitability available. If profit formula have changed I`d be anxious to see them but looking at the last few months it is clear that sales of the big three have suffered a much greater loss than the Asian big three so I tend to think that profitability has not changed much.



To check on just how well managed GM has been I went and looked back at GM`s stock performance over the past 5 years and compared it to Toyota and the DOW.



So why do GM and Ford chiefs seem to get outrageous salary increases while they seemingly run the companies into the ground then ask for bailouts?