Jalopnik 
Enter your username and password.
Detroit, 4:35 PM
Wed Dec 9
25 posts in the last 24 hours
Tip your editors:
Editor-in-Chief:
Ray Wert | | AIM
Road Test Editor:
Wes Siler |
Weekend Editor:
Murilee Martin |
Associate Editor - Houston:
Associate Editor - Detroit:
Editor-at-Large:
Contributors:
John Krewson |
Original material is licensed under a Creative Commons License permitting non-commercial sharing with attribution.
11/17/08
11/16/08
Personally I'd like to see GM saved and then single out the fuckers who are responsible for the mess, and make them the laughing stock of the country. Print their pictures in the paper. Or make a dodgy businessman register like you have for sex offenders.
They couldn't run a root in brothel, what are they doing running a major (formally largest) car manufacturer?
11/15/08
1) Take over FULL medical costs for all their retirees.
2) Cover ALL pension expenses for retirees.
3) Fully fund development of next gen. high capacity batteries for shared hybrid/elec. vehicle production.
The companies would be allowed to use their pension funds for tax-free $$$ infusion.
Chrysler might still die in the process, but GM/Ford could ride it out.
11/16/08
BTW, no one has mentioned that the EU is threatening WTO reprisals if the US bails out the domestics...
Boy howdy... I bet Obama is wondering whether or not he wants to ride this horse now that he bought it...
11/16/08
11/15/08
11/15/08
What do you expect when you continually whore yourself out to the public offering 0% money for 72 months, Employee pricing every damned time you turn around and HUGE SUV's that complete douchebags drive down the highway in with seating for 9 by themselves.
I hope they go under. One less manufacturer for the others to compete with.
11/15/08
Ya know, goddamn GM, always producing giant SUVs for douchebags! Yep, I hope they burn for it!
11/15/08
Here's the rock-toting Semi Truck driver heading home for the day:
[www.craveonline.com]
Sorry the embed code didn't work.
/threadjack
11/15/08
11/15/08
11/15/08
11/16/08
11/15/08
It's not like they got here without any gvm't help.
Seven years of easy finance from "easy Al" which encouraged people to move up the food chain when buying a new car/truck, and 30 years of refusing to raise fuel taxes when oil was under $10 to a level closer to what the rest of the developed world deemed reasonable thus encouraging even grannies & secretaries to buy huge trucks, are what got us here.
Hell even Toyota builds its own monster P/U.
It ain't all the industries fault...
11/16/08
The auto industry has been keeping gas prices low, emissions/CAFE away from trucks, and has made heavy vehicles tax deductible precisely so that they can make a quick buck from big, easy to make vehicles.
They made their bed, and what more is they made us all sleep in it. Fuck them, it IS their fault.
11/15/08
11/15/08
I keep on hearing that management needs to be cut as part of whatever deal. How would this help? Nardelli and Mulally have been at their posts less than two years, and Wagoner, despite all the money lost, has transformed the company into making competitive vehicles.
@tad49: nothing special about GM? Just the fact that they're still the largest volume manufacturer in the world, huh? And Chrysler will not pick up any sales soon, I guarantee this. Cerberus wants out, and they are slowly finding their way out of the car business. What does that leave behind? A carcass for the rest of the auto companies to pick off of... which they don't want right now, because the market's so bad. (this goes for anyone saying that GM should be bought by a Chinese company as well- why not buy up Chrysler? It would be much easier, and start them off at a much smaller scale)
11/14/08
[www.fool.com]
"Japan's industrial sector has failed to meet its cost of capital over the last 20 years, in large measure because the government has allowed capital-destroying companies to continue to operate. Had these companies been allowed to fail, Japan long ago could have flushed out its system and gotten back on the road to economic health. In the name of protecting jobs, Japan's economy has continued to sputter, punctuated by spectacular bankruptcies in cases where the facade could not hold up. The cost of propping them up has been much, much more economic pain. Japanese call the long economic downturn ushinawareta junen, the lost decade."
11/16/08
11/16/08
Just sayin'...
11/14/08
So the government bails out GM. What happens then? Does GM just continue on as they were? Their failed business plan is what got them into this situation, and the executives who green-lighted it should take responsibility for their actions. They're asking for a very short-term bailout, on some fervent hope that they'll somehow recover next quarter. Has nobody noticed that the chart showing vehicle sales in America is pointing down, down, down. And when you look at the chart for domestic auto sales, it points even steeper down, down, down. So how is this bailout going to help things? Isn't it like putting a band-aid on an arterial bleed?
So let's say the gubmint takes an equity position. They buy up a ton of GM stock (which shouldn't cost more than, oh, say, $50) and become a primary shareholder in the company. As such, they insist on guillotining the existing leadership, and bringing in a new board of directors with a new vision. How, pray, do they expect to do that? The company doesn't have the money to pay them the wages that the really, truly competent executives would demand, and with the government in control, there would be even more pressure to make sure that "executive compensation" was rolled in. So what do we get instead? Government types? Great. Considering the bang-up job they're doing with the economy, that's reassuring. So you get another group of executives with distorted priorities, and more vehicles that look like they're designed by a committee.
And when the company continues to lose money, what's going to happen? They'll turn back to the government, and since the taxpayer already has a huge investment in GM, they'll keep throwing money at it because they don't want to lose what they've already sunk in there. The poker term is "pot committed".
To extend that analogy, GM is holding a seven-deuce off-suit, and going all in. It might work for this hand, but what's going to happen three or four hands from now?
I'd like to see GM survive as much as anyone. I still want a G8 GXP! But this looks like a lose-lose situation, and I think the market has to be allowed to run its course.
11/16/08
These are unprecedented times which call for a regrouping of inordinate scale
11/16/08
Since most of the parts for GM cars are made by Magna, which is a Canadian company, tariffs there won't work. Many other parts or components come from Mexico... so tariffs there won't work. Where shall we put them up? Trade from Europe? I can't hardly see them reacting to that, so you could eliminate all twelve of the cars GM sells there in a year. Japan? China?
You're dealing with an entire planet of countries that are more protectionist than the US is. So the moment the US tries to become isolationist, it's going to make things a whole lot worse, rather than better.
11/16/08
No offense meant to our Canadian and Mexican friends but until this economy is straightened out, a little protectionism may not be a bad thing. When we recover maybe we then can support a world trade agreement that actually equalizes the playing field. Apparently, it's a historical fact (protectionism) worked in Japan and stabalized their automobile industry to the point where they could move over here and compete.
True enough, the automobile industry here has made silly mistakes rooted in greed which has cost market share and created a virtual image of superiority of European and Asian cars.
As a case in point, some studies were done which compared Chrysler cars compared with Japanese Mitsubishi cars. The survey done here in the States indicated that the Japanese products were seen as higher quality than their Chrysler counterparts. It turned out that the Mitsubishi cars were produced on the exact same assembly line as the Chrysler cars in the Normal, Illinois plant.
So, perceptions can change over time, in the long run if the auto industry recovers here, and learns from its mistakes, that can happen here too.
This might exactly be what's needed here for the auto industry to catch its breath and rethink its business plan.
11/17/08
The impact would be on the auto industry. Your example of Japan doesn't really fly in the US, because the Japanese produced all their own parts, and only imported raw materials. In the US, my point was that if they slapped on tariffs, it would only increase the automakers' costs of doing business, and thereby hurt their business, not help it. The only company who would really be impacted would be Volkswagen, IIRC, because they're the only major company who don't manufacture at least some of their North American cars in North America, and two years ago VW was talking about pulling out of the US altogether anyhow.
It feels very weird to be a liberal social-democrat preaching for the side of free-market economics...
11/14/08
11/14/08
11/14/08
I'm not feeling any sympathy for any companies, lately. I have my canned food, my land, and several thousand rounds of .22 ammo. I'm good for a while.
11/15/08
11/14/08
Even if Ray didn't sell his Burberry Quattroporte to help us out, it would be, what, $200k each? Pricey, sure, but it could be worth it.
El Caminos for all!
11/14/08
You really think?
All these citizens are bad personal managers and be in trouble again, same will happen with the car manufactures.
(wife takes longer to prepare for party)
11/14/08
OK there is much more to discuss, but today is party time and will leave the discussing to you.
11/14/08
So it goes to Chapter 7. Fine. That doesn't guarantee that everyone's going to be out of work. It would mean a deep slump in the economy, but probably only for a few months until the new owners got it up and running. If it was planned well enough, there might not be any slump at all.
Also, not saying I have all the answers, but I hate dealing in absolutes. Saying, "either we (meaning you Americans) bail them out or the economy will stop and the world will end" is meaningless absolutism. There are other possibilities and other options, and it's about time they started getting some airtime as well.