Interesting comment on auto bail out.....
http://katm6.blogspot.com/2008/12/edito ... ealer.html
$1:
As I watch the coverage of the fate of the U.S. auto industry, one alarming and frustrating fact hits me right between the eyes. The fate of our nation's economic survival is in the hands of some congressmen who are completely out of touch and act without knowledge of an industry that affects almost every person in our nation. The same lack of knowledge is shared with many journalists whom are irresponsible when influencing the opinion of millions of viewers.
Sen. Richard Shelby of Alabama has doomed the industry, calling it a dinosaur. No Mr. Shelby, you are the dinosaur, with ideas stuck in the '70s, '80s and '90s. You and the uninformed journalist and senators that hold onto myths that are not relevant in today's world.
When you say that the Big Three build vehicles nobody wants to buy, you must have overlooked that GM outsold Toyota by about 1.2 million vehicles in the U.S. and Ford outsold Honda by 850,000 and Nissan by 1.2 million in the U.S. GM was the world's No. 1 automaker beating Toyota by 3,000 units.
When you claim inferior quality comes from the Big Three, did you realize that Chevy makes the Malibu and Ford makes the Fusion that were both rated over the Camry and Accord by J.D. Power independent survey on initial quality? Did you bother to read the Consumer Report that rated Ford on par with good Japanese automakers.
Did you realize Big Three's gas guzzlers include the 33 mpg Malibu that beats the Accord. And for '09 Ford introduces the Hybrid Fusion whose 39 mpg is the best midsize, beating the Camry Hybrid. Ford's Focus beats the Corolla and Chevy's Cobalt beats the Civic.
When you ask how many times are we going to bail them out you must be referring to 1980. The only Big Three bailout was Chrysler, who paid back $1 billion, plus interest. GM and Ford have never received government aid.
When you criticize the Big Three for building so many pickups, surely you've noticed the attempts Toyota and Nissan have made spending billions to try to get a piece of that pie. Perhaps it bothers you that for 31 straight years Ford's F-Series has been the best selling vehicle. Ford and GM have dominated this market and when you see the new '09 F-150 you'll agree this won't change soon.
Did you realize that both GM and Ford offer more hybrid models than Nissan or Honda. Between 2005 and 2007, Ford alone has invested more than $22 billion in research and development of technologies such as Eco Boost, flex fuel, clean diesel, hybrids, plug in hybrids and hydrogen cars.
It's 2008 and the quality of the vehicles coming out of Detroit are once again the best in the world.
Perhaps Sen. Shelby isn't really that blind. Maybe he realizes the quality shift to American. Maybe it's the fact that his state of Alabama has given so much to land factories from Honda, Hyundai and Mercedes Benz that he is more concerned about their continued growth than he is about the people of our country. Sen. Shelby's disdain for "government subsidies" is very hypocritical. In the early '90s he was the driving force behind a $253 million incentive package to Mercedes. Plus, Alabama agreed to purchase 2,500 vehicles from Mercedes. While the bridge loan the Big Three is requesting will be paid back, Alabama's $180,000-plus per job was pure incentive. Sen. Shelby, not only are you out of touch, you are a self-serving hypocrite, who is prepared to ruin our nation because of lack of knowledge and lack of due diligence in making your opinions and decisions.
After 9/11, the Detroit Three and Harley Davidson gave $40 million-plus emergency vehicles to the recovery efforts. What was given to the 9/11 relief effort by the Asian and European Auto Manufactures? $0 Nada. Zip!
We live in a world of free trade, world economy and we have not been able to produce products as cost efficiently. While the governments of other auto producing nations subsidize their automakers, our government may be ready to force its demise. While our automakers have paid union wages, benefits and legacy debt, our Asian competitors employ cheap labor. We are at an extreme disadvantage in production cost. Although many UAW concessions begin in 2010, many lawmakers think it's not enough.
Some point the blame to corporate management. I would like to speak of Ford Motor Co. The company has streamlined by reducing our workforce by 51,000 since 2005, closing 17 plants and cutting expenses. Product and future product is excellent and the company is focused on one Ford. This is a company poised for success. Ford product quality and corporate management have improved light years since the nightmare of Jacques Nasser. Thank you Alan Mulally and the best auto company management team in the business.
The financial collapse caused by the secondary mortgage fiasco and the greed of Wall Street has led to a $700 billion bailout of the industry that created the problem. AIG spent nearly $1 million on three company excursions to lavish resorts and hunting destinations. Paulson is saying no to $250 billion foreclosure relief and the whole thing is a mess. So when the Big Three ask for 4 percent of that of the $700 billion, $25 billion to save the country's largest industry, there is obviously oppositions. But does it make sense to reward the culprits of the problem with $700 billion unconditionally, and ignore the victims?
As a Ford dealer, I feel our portion of the $25 billion will never be touched and is not necessary. Ford currently has $29 billion of liquidity. However, the effect of a bankruptcy by GM will hurt the suppliers we all do business with. A Chapter 11 bankruptcy by any manufacture would cost retirees their health care and retirements. Chances are GM would recover from Chapter 11 with a better business plan with much less expense. So who foots the bill if GM or all three go Chapter 11? All that extra health care, unemployment, loss of tax base and some forgiven debt goes back to the taxpayer, us. With no chance of repayment, this would be much worse than a loan with the intent of repayment.
So while it is debatable whether a loan or Chapter 11 is better for the Big Three, a $25 billion loan is definitely better for the taxpayers and the economy of our country.
So I'll end where I began on the quality of the products of Detroit. Before you, Mr. or Ms. Journalist continue to misinform the American public and turn them against one of the great industries that helped build this nation, I must ask you one question. Before you, Mr. or Madam Congressman vote to end health care and retirement benefits for 1 million retirees, eliminate 2.5 million of our nation's jobs, lose the technology that will lead us in the future and create an economic disaster including hundreds of billions of tax dollars lost, I ask this question not in the rhetorical sense. I ask it in the sincere, literal way. Can you tell me, have you driven a Ford lately?
Jim Jackson
Elkins Fordland
ziggy @ Sat Dec 06, 2008 5:33 am
So some numbers have been shown for a bailout now,im wondering if the union is making any concessions. I dont mean monetary as much as work sharing so that the folks getting laid off would still get to work.I havent seen much from the union about what they can do to help or is it just the high seniority guys that will be ok?
Ive been through some times here where thousands got laid off and the union allways worked at keeping everyone working.
Why is the media calling this a bail out when it's a loan that will be paid? Why was there little hesitation to give a freebie to Wall Street & Banking who caused the problem yet the great hesitation to give a loan to a victim of the Wall Street fiasco?
stemmer stemmer:
Why is the media calling this a bail out when it's a loan that will be paid? Why was there little hesitation to give a freebie to Wall Street & Banking who caused the problem yet the great hesitation to give a loan to a victim of the Wall Street fiasco?
care to guess who is giving the money to whom ?
and therein lies the answer..
its why the US taxpayer isn't getting any either.
ziggy @ Sat Dec 06, 2008 10:55 pm
So no union concessions then? I'm curious as to how they are helping their members if at all.
They aren't. Of course they haven't been helping anyone for the past few decades. Once all of the plants are in the non-Union South they'll finally understand.
ziggy @ Sun Dec 07, 2008 12:10 am
dog77_1999 dog77_1999:
They aren't. Of course they haven't been helping anyone for the past few decades. Once all of the plants are in the non-Union South they'll finally understand.
That's sad,in my union days the brothers and sisters looked out for each other.if it meant giving up one shift a week so someone else could work then it was done,no vote needed.
Guess greed is the word of the day now,me first!
ziggy ziggy:
dog77_1999 dog77_1999:
They aren't. Of course they haven't been helping anyone for the past few decades. Once all of the plants are in the non-Union South they'll finally understand.
That's sad,in my union days the brothers and sisters looked out for each other.if it meant giving up one shift a week so someone else could work then it was done,no vote needed.
Guess greed is the word of the day now,me first!
I wouldn't say people aren't doing that. I think people need to realize when there just is no job for them anymore. Sitting around doing nothing and getting paid is ultimatly going to hurt other union members. The retirement benifits are also a big problem, but I think a combination of reduced payments and help from the government(there is a retirement board) would improve the finacial picture.
Sapio @ Sun Dec 07, 2008 12:36 am
It was wrong to bail out wallstreet and it is wrong to bail out the automakers. The automakers should fail if not one is buying their product. They will learn to make less cars or cars that people want. If they do not a company that can will take over. Bails are not constitutional in the States, thus their federal government should not do it. Plus bails have worked so well in Canada. Air Canada and Bombardier are great examples of that.
Scape @ Sun Dec 07, 2008 12:45 am
Problem is that credit is no longer out there. We can put billions into the banks but they can't lend because wages haven't gone up in 30 years as compared to inflation so the people who buy cars are a not a viable credit risk for the banks. Bailing out the automakers is a short term band aid to a problem that has all but over run the US and world economy. Sure car makers should have made more fuel effective cars but the profits in the suv's for the short term are the bread and butter of the auto industry. Jobs are the only way the US is going to dig their way out of this recession that threatens to become a depression and to not bail them out now means we compound the job losses. In an idea free market they don't deserve a bail but we are not in ideal times, this is a no holds barred nightmare scenario and conventional solutions will fail. The economy needs a jump start and now. Deficit's are going to have to be dealt with later but if you have no job it doesn't matter what the debt is, you can't pay it.