The Big Three Automakers?

[UberBeaver]

Save em? Or let em fail?



I lean towards let them fail as they have been without innovation for years. And when a company grows stagnant, the market eats it. I think that's what we're seeing here,and as far as I'm concerned, it's their own faults.

On the flip side, this would impact a large part of the population. Hopefully some would go on to start new companies that will succeed, and then rehire many of those effected, but that would obviously take some time. The interim would be brutal.

I don't know if there's a 3rd option or not, but save them and ensure that they meet certain milestones along the way - innovation, green technology for improved fuel standards, safety, etc etc etc.

 

[elevated_u2_fan]

I'm torn on this one...

On the one hand, it's very true that it is their own fault. Anyone could see that the potential for higher oil prices combined with the Big Three's flagrant production of oversized vehicles with wasteful levels of fuel consumption was clearly a disaster waiting to happen. The fact that they were more interested in profit over conservation angers me to no end...

On the other hand, the auto manufacturing sector really is the backbone of the economy, more so in the US then here in Canada but the province I live in (Ontario) will most likely be hit the hardest since we have the largest amount of auto workers...

I really don't know.

 

[UberBeaver]

You guys make our cars?

 

[elevated_u2_fan]

In some cases, yes.

Some of the larger cities in southern Ontario near Detroit (Windsor most notebly) were pretty much founded on the auto industry...

 

[elevated_u2_fan]

The thing you have to remember is that it's not just the people who make the cars and trucks but also the people who make the thousands of different parts and components that go into the cars and trucks...

Should a small company which makes locking mechanisms for Ford pay the price for Ford's stupidity?

 

[LarryMullen's POPAngel]

I say wait until I get another job and then let em fail...

Living near Detroit, and working for one of them, it's been depressing the last few years, but honestly, when you hear of the bigwigs giving themselves bonuses while laying off the worker bees, it pisses me off to no end, and I hope that one day they all do go down the crapper. On the other hand, I'd rather be off that sinking ship before it happens.

 

[UberBeaver]

Living near Detroit, and working for one of them, it's been depressing the last few years, but honestly, when you hear of the bigwigs giving themselves bonuses while laying off the worker bees, it pisses me off to no end, and I hope that one day they all do go down the crapper. On the other hand, I'd rather be off that sinking ship before it happens.

Yup, and it's things like that that say to me, "They're done. They've made themselves obsolete by turning themselves into profit machines for the few." It's a shame. CEO's don't seem to have much a stake in companies anymore - they make millions either way. Pisses me off.

el-fa - it sucks that the lock companies will be effected. Hopefully they will be able to work with whatever comes to fill the void.

Anyone want to open a car company with me?

 

[elevated_u2_fan]

I’m in, what do you want to call it?

We also need to think of fancy names for the cars... like Panther or Excelsior!

 

[BVS]

I think they should do a bailout with preconditions.

The auto industry has been catering to the oil tychoons far too long, at the very least we could have affordable vehicles that get almost 2x the MPG that we have today, the technology is out there.

They've shot themselves in the foot, they are extremely stagnant, but like elevated said it affects a much bigger circle than just the "big 3"...

 

[ntalwar]

The world has too many automakers, big banks, airlines, etc. More mergers would be a good idea imo.

 

[elevated_u2_fan]

centralization is a dirty word in America....

 

[toscano]

Save em? Or let em fail?



I lean towards let them fail as they have been without innovation for years. And when a company grows stagnant, the market eats it. I think that's what we're seeing here,and as far as I'm concerned, it's their own faults.

On the flip side, this would impact a large part of the population. Hopefully some would go on to start new companies that will succeed, and then rehire many of those effected, but that would obviously take some time. The interim would be brutal.

I don't know if there's a 3rd option or not, but save them and ensure that they meet certain milestones along the way - innovation, green technology for improved fuel standards, safety, etc etc etc.

If my industry couldn't be competitive we'd be out of business, losing 20,000 people worldwide.

Having said that, any bailout should come with a set of conditions which includes a business plan to streamline/consolidate.

They make too many models which people don't want, their quality still isn't close to Japanese, or even Korean levels, etc.

Do we REALLY need a Ford, Lincoln and Mercury ?
Do we REALLY need a Chrysler, Plymouth and Dodge ?
Do we REALLY need a Buick, Cadillac, Chevrolet, Saturn and Pontiac ?

There are too many models, too many brands, too much overlap.

The main Japanese companies have, at the most, TWO brands (Honda/Acura, Nissan/Infiniti, Toyota/Lexus) and most other major guys don't even have THAT.

 

[elevated_u2_fan]

Do we REALLY need a Ford, Lincoln and Mercury ?
Do we REALLY need a Chrysler, Plymouth and Dodge ?

this is an excellent point, we don't have the Mercury or Plymouth models here in Canada and we're not suffering or anything... I've always wondered why they do this since it's the same exact fucking car!

 

[purpleoscar]

If they don't figure out their lavish union benefits and look at what Toyota does it won't matter what funds are sent to them. If the management and infrastructure doesn't change it will be like the banks: The money won't be spent the way government thinks it will be.

Bankruptcy protection will lead to renegotiation of loans and if that isn't good enough some other company with a better business model will buy them up. Ford has been known by consumer reports and other auto reviewers to have shoddy reliability and lots of recalls, hence the value of Ford vehicles drop faster than Toyota.

Also the general population is up to their necks in debt so even if the big three make better cars there is still too much production and inventory on the market. The population has to deleverage for a while before people can even afford another car.

 

[toscano]

If they don't figure out their lavish union benefits

Union benefits are the LEAST of their problems (for now).

The more pressing issue is that they can't make reliable cars, they have zero ability to read where a market will go, they have too many models and too many factories.

Once they fix all that, then they need to look at their Production costs, which will include the union-related spend.

 

[Lila64]

I thought I heard 1 in 10 people work in the auto industry. I agree that there has to be some preconditions, and as Toscano said, there are so many model cars out there - who the hell is buying (bought) them? My cars have always been Japanese (Toyota, Honda), and I would never buy a GM/Ford....

 

[Varitek]

I think letting them fail would be too disasterous. And why should a bunch of rich bankers get a bail out but not working class auto people (or at least that's how it will look)? But I hope they can figure out how to tie the bailout to innovation and greener standards.

 

[ntalwar]

The more pressing issue is that they can't make reliable cars, they have zero ability to read where a market will go, they have too many models and too many factories.

Once they fix all that, then they need to look at their Production costs, which will include the union-related spend.

The stock prices of Honda and Toyota are down 50% off their yearly highs, so the entire industry is taking a beating (regardless of reliability). Industrywide, there is too much supply and capacity for the flat to declining demand. Mergers and industry downsizing are required, as we have seen in the banking sector and airlines. And the US car companies have an average wage of something like $73 an hour (including benefits) - a lot higher than Toyota.

 

[toscano]

I think letting them fail would be too disasterous. And why should a bunch of rich bankers get a bail out but not working class auto people (or at least that's how it will look)? But I hope they can figure out how to tie the bailout to innovation and greener standards.

Where do you draw the line on who gets a bailout ??

 

[toscano]

The stock prices of Honda and Toyota are down 50% off their yearly highs, so the entire industry is taking a beating (regardless of reliability).

Yes, but it's one thing to have your stock be down, quite another to be bleeding billions of dollars.....

 

[phillyfan26]

The money has to be given them in a structured way, with the government dictating how the money is spent. Don't force them, essentially go into a contract. Say, "Hey, we'll bail you out, but you gotta spend the money this way." With that way being a move towards energy efficient cars.

 

[BoMac]

The money has to be given them in a structured way, with the government dictating how the money is spent. Don't force them, essentially go into a contract. Say, "Hey, we'll bail you out, but you gotta spend the money this way." With that way being a move towards energy efficient cars.

I think, as dire as the situation is right now for the automotive industry, that this is an excellent opportunity to fulfill one of Obama's major campaign promises, and that is to end America's dependence on foreign oil. They can make more energy efficient cars and invest in alternative sources of fuel. This is a tremendous opportunity.

 

[toscano]

The money has to be given them in a structured way, with the government dictating how the money is spent. Don't force them, essentially go into a contract. Say, "Hey, we'll bail you out, but you gotta spend the money this way." With that way being a move towards energy efficient cars.

Ummm, the money is so they can, amongst other things,meet payroll !

New cars are designed about 3 years before they actually hit the showroom floor, in the meantime they need to sell shit and pay their workers !

 

[U2DMfan]

If the PBGC already insures their pensions, that's fine with me if they go belly up.
Maybe their failures will bring about an overhaul of the American auto industry.

If it is deemed to be in the national interest to bail them out, we should bail them out.
And have them donate 25% (whatever) of their future profit over the next X# of years to paying back the debt with interest.

I am no expert on the economics of the situation but I can't say that I trust our leaders to make the best decision in the interest of the American people, rather they will make the best decision in the interest of the interests of those who helped them win their re-elections.

I would prefer that the decision not be made until after Jan 20th if at all possible.
Not that the Dems are assured to make the correct decision but I believe Obama will make the best decision available.

 

[anitram]

If these did not employ hundreds of thousands of people (and even more indirectly) I would very easily say let them fail.

Japanese car makers do not have the same financial woes (to the same extent anyway). So maybe capitalism has spoken, and American car makers have been rejected by the consumer on a large enough scale that it no longer makes sense to keep bailing them out.

 

[Vincent Vega]

this is an excellent point, we don't have the Mercury or Plymouth models here in Canada and we're not suffering or anything... I've always wondered why they do this since it's the same exact fucking car!

It's the brand. Some people buy cars by name. If their Cadillac was now called Buick they wouldn't be as tied to the company anymore.
Most of those companies got bought by bigger ones and the name was kept for the reason of branding.

The auto manufacturing sector is, as said, huge. Whenever you learn about multiplier effects in Economics classes, it is most likely the example will be car manufacturers. To let these companies fail would result in huge job losses, and the effects of these losses would be tremendous on the whole economy. No government will risk that.
But a restructuring is needed. American car companies are huge entities that are extremely slow and disconnected from the market. If their management had done anything more than getting high on their pay checks they would have re-adjusted long before simply out of anticipating that the "bigger=better" principle couldn't last. Instead, more and more lines got dedicated to build huge SUVs and pickups. In a perfect world you would just let them pay the price for their mismanagement. But doing that, the overall costs will be extremely high.

 

[GirlsAloudFan]

YouTube - The White Stripes - The Big Three Killed My Baby (Live)

 

[ntalwar]

Ummm, the money is so they can, amongst other things,meet payroll !

New cars are designed about 3 years before they actually hit the showroom floor, in the meantime they need to sell shit and pay their workers !

The fuel efficient cars are already there. Look at the models Ford and GM sell in Europe for example - models that don't exist in the US. The problem is that low gas prices (for now) will not spur consumers to buy those smaller models, and they also have a lower profit margin.

 

[Se7en]

i think someone nailed it right on the head - the problem is the workers and their union. always has been. what kind of asshole believes that they DESERVE a good hourly wage, health care benefits, and a guaranteed pension? NO ONE deserves these things, let alone some guy on an assembly line! and under the new bargaining agreement that those extortionist uaw mob bosses "negotiated," new hires will be stealing about $14-16 per hour from gm!!! including benefits this will amount to about $25 per hour!!!!!! that's insane!!!! these people need to get a grip and try living in the REAL WORLD. you have to have a college degree to make $16 per hour these days!! go back to school and get a REAL job! let toyota just take over. i mean, i know that they pay large bonuses to their workers despite their more realistic hourly wage, but this is JUST TO KEEP THE EXTORTIONIST UAW MOB BOSSES OUT OF THEIR FACTORIES! let all these money suckers at gm and ford get jobs that are more on par with the economic realities. the mcdonalds in my neighborhood is ALWAYS hiring for the night shift. maybe if these slacker workers flipped burgers for a while they would know what it's like to STRUGGLE. ugh, these people just make me SICK.

 

[UberBeaver]

i think someone nailed it right on the head - the problem is the workers and their union. always has been. what kind of asshole believes that they DESERVE a good hourly wage, health care benefits, and a guaranteed pension? NO ONE deserves these things, let alone some guy on an assembly line! and under the new bargaining agreement that those extortionist uaw mob bosses "negotiated," new hires will be stealing about $14-16 per hour from gm!!! including benefits this will amount to about $25 per hour!!!!!! that's insane!!!! these people need to get a grip and try living in the REAL WORLD. you have to have a college degree to make $16 per hour these days!! go back to school and get a REAL job! let toyota just take over. i mean, i know that they pay large bonuses to their workers despite their more realistic hourly wage, but this is JUST TO KEEP THE EXTORTIONIST UAW MOB BOSSES OUT OF THEIR FACTORIES! let all these money suckers at gm and ford get jobs that are more on par with the economic realities. the mcdonalds in my neighborhood is ALWAYS hiring for the night shift. maybe if these slacker workers flipped burgers for a while they would know what it's like to STRUGGLE. ugh, these people just make me SICK.

lol.

Someone said, i think $73/hr. $73 x 40 x 52 = $151,840.

Ford CEO Paid $39.1 Million for Four Months
t r u t h o u t | Ford CEO Paid $39.1 Million for Four Months

39,000,000 x 3 = $117,000,000

$117,000,000 / $151,840 = 770 employees.

THOSE GODDAMN GREEDY UNION FUCKS IS TAKING ALL THE MONEY!!!!


Having said all that. Were you serious or being sarcastic? Because the points you make sound sarcastic, but there's a very good chance you're serious. So, I'm just making sure.