#  >  > Living And Legal Affairs In Thailand >  >  > Thailand and Asia News >  >  > Business, Finance & Economics in Thailand >  >  US Automakers Your opinion: Bailout or Bankruptcy?

## Rattanaburi

Just curious what you think should and will happen to the US Auto giants who are struggling. I guess GM and Ford? 

In your opinion, should the US government let them fail or bail them out? 

What do you think will actually happen?

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## panama hat

Yup, they will get a bail-out. 

All this talk of unionisation and the like being the core problem is nonsense.  The main reason for the car companies not doing well is that they simply cannot compete with the competition in price or quality. 

Germany, France and Japan have unionised workforces, their wages are high, the social contributions are high etc . . . 

These country's auto-makers have diversified, started up plants in consumer's countries, made quality their modus operandi, went with or started the trend for fuel efficiency, looked at consumer needs and wants . . . 

 . . . while the US automakers kept making gas guzzlers, continued to make uncompetitive and low-quality cars. 

Export . . . how many US cars do you see in Thailand, Australia, Germany, France, Japan, South Africa, Denmark etc . . .

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## Rural Surin

Expect the bail-out for sure. This is the usual insane move by the US govt to continue to subsidize rotten and undeveloped business practices. And will continue to do so even after they continue to tread water. Corporations as the auto biz in the States are an albatross on the economy already laddened with illusion. Unfortunately, most have bought the ideals that industries such as these, are vital to the phony balony economy. They're not that vital when they've been working in the red and under bankruptcy for decades..... :Sad:

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## BugginOut

Is your question "Will" or "Should"? The poll is asking whether or not the government will bail out the automakers, but your post asks should they bail them out. I can't if they will won't but I don't think they should. Free-market economy should be sink or swim for the big guys just like it is for the small ones. If the rich get socialism then so should the poor.

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## watterinja

The US automakers are so far behind the curve that they do deserve to move into bankruptcy. 

Their forward vision is so archaic that is is senseless pouring more good money in after bad. Perhaps it would be in their best interests to be taken over by an outside automaker - eg. Toyota, Honda... 

I've been privileged to hear Toyota's engineering director discuss their strategy & forward vision - stunning stuff. Toyota didn't get to where it has by crying 'help me' when their business model suffered - they strategised, re-focused & moved ahead. The Japanese are strategic planners, whilst the US automakers have tended to rest on former glories.

Let the Detroit three move into bankruptcy.

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## Sir Burr

> Germany, France and Japan have unionised workforces, their wages are high, the social contributions are high etc . . . 
> 
> These country's auto-makers have diversified, started up plants in consumer's countries, made quality their modus operandi, went with or started the trend for fuel efficiency, looked at consumer needs and wants . . . 
> 
> . . . while the US automakers kept making gas guzzlers, continued to make uncompetitive and low-quality cars. 
> 
> Export . . . how many US cars do you see in Thailand, Australia, Germany, France, Japan, South Africa, Denmark etc . . .


The US car-makers foreign brands do reasonably well as they make cars for the market they're in. Ford do reasonably well in Europe, GM / Opel / Vauxhall / Holden also do well in the countries they're made.
It's the home market that is completely buggered.

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## Smeg

1 in 10 jobs in the US rely on it. What a ridiculous situation to be in, in a country that probably spends more on trying to put men on mars than on trying to develop efficent engines

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## killerbees

I would have to agree with the above (crappiness of US-made cars, inevitability of a bailout). It's a shame but that seems to be the direction they're heading. They wasted the last 10 (+) years making huge, gas-guzzling SUV's, with everybody thumbing their noses at the coming shitstorm.

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## Rural Surin

> 1 in 10 jobs in the US rely on it. What a ridiculous situation to be in, in a country that probably spends more on trying to put men on mars than on trying to develop efficent engines


Or even more realistic, spends their weight towards military/war-related expenditures decade after decade instead on turning inward and concerning themselves with basic civil infrastructues.

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## Gaudente

The question should be modified this way:
Will the USA government help involve or avoid Chapter 11 ?
To my opinion, Chapter 11 is necessary for whatever restructuring process, as only by resorting to Chapter 11 the Unions will finally face reality and accept the 75% wage cuts that are necessary to put the USA automakers back on track.
Any smaller wage cut would waste whatever help/loan received from the government.

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## Norton

> 1 in 10 jobs in the US rely on it.


Another nonsense "statistic" used by supporters of the bailout.  There may be this many jobs involved in the auto industry but implying they would all be out of work if the big three goes bust is bollocks.

Chevrolet dealers will become Honda or Toyota dealers, parts suppliers will supply parts to other auto manufacturers who build in the US.  


If they have any intrinsic value, successful auto manufacturers will buy their "good" assets and the end of the world will be averted.  Bailouts are a crutch for bad business.  What next?  If Microsoft has a bad year will they be bailed out?  There is no end.

Screw the big 3!!  Let them eat cake.  They deserve to reap what they have sowed.

The poll asks "will" the government bail them out so I will have to vote yes even though I strongly disagree and believe it is politics based on buying votes.  Something Thailand is much criticized for doing :Sad:

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## Mid

> Bailouts are a crutch for bad business. What next? If Microsoft has a bad year will they be bailed out? There is no end.


_too big to fail ...................._

rapidly accending to _with us or against us_ status .  :Sad:

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## Troubled

> In your opinion, should the US government let them fail or bail them out?


Should they? No
Will they? Yes.

I just can not see the politicians voting against a bailout.




> while the US automakers kept making gas guzzlers, continued to make uncompetitive and low-quality cars


Agreed.




> Expect the bail-out for sure


You bet.

There has also been an arrogance amongst the US auto makers that obviously made it difficult to see the way the market was heading.


I remember years ago one of the big three dealerships in the New York area used to advertise on TV " Buy our cars and we will throw in a Yugo (remember them?) free)

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## Norton

> Buy our cars and we will throw in a Yugo


A new slogan for Fiat when they buy out Ford.  "We'll even throw in a Mustang if you buy today".  Poetic justice!

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## TSR2

It reminds me of the motorbike / car industries in the UK (deceased) a few years ago, SHIT PRODUCTS ,SHIT "MANAGEMENT" !!!!  asking for and getting a bailout ,read extended life on taxpayers money ,now all gone because the problems were never addressed at the time, probably too late anyhow, Now Obama is showing his economic nievity in supporting GM/ Ford /Chrysler, its too late for them , a slow lingering expensive death awaits

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## Texpat

Jap cars sold in the US aren't the tiny little shitcans that putt-putt around Tokyo.

Americans drive a lot and prefer bigger cars. There are dozens of models of Toyotas and Mitsubishis in Tokyo that you'll never find in the US --they're too small and probably couldn't pass safety standards.

The Camrys and Lexus and big-end models do very well in the States. Nissan sells a V-10 truck that sells nicely. 

If the US car companies can't compete, let 'em fold.




> Now Obama is showing his economic nievity[sic] in supporting GM/ Ford /Chrysler, its too late for them


Watch your mouth Mister Racist. That's the Messiah you're blaspheming.  :Roll Eyes (Sarcastic):

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## bkkandrew

> Originally Posted by Smeg
> 
> 1 in 10 jobs in the US rely on it.
> 
> 
> Another nonsense "statistic" used by supporters of the bailout. There may be this many jobs involved in the auto industry but implying they would all be out of work if the big three goes bust is bollocks.
> 
> Chevrolet dealers will become Honda or Toyota dealers, parts suppliers will supply parts to other auto manufacturers who build in the US. 
> 
> ...


I entirely agree with you Norton and voted in this poll with the same feelings as you.

The FED is hell-bent on accelerating national bankruptcy and default by this bailout route. Jaysus, even individual cities and real estate agents are asking for bailout funds!

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## TSR2

> Watch your mouth Mister Racist


Excuse me where is the racist content???

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## jizzybloke

^It's all in the smiley!

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## TSR2

> That's the Messiah you're blaspheming


Messiah eh!!   is that the promised "LEND"

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## Gaudente

> Watch your mouth Mister Racist. That's the Messiah you're blaspheming.


I am racist instead and I think that when a white majority country elects a negro as president the people must really be gone nuts. Just watch what happened to Zimbabwe and South Africa when leadership went black. And just because there's no end to disgrace, the negro has even called the feminazi to be his secretary of state. Prepare for an era of doom and gloom.

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## watterinja

^ What's that got to do with automakers & the proposed bail-out?   :Confused:

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## mellow

They should bail them out. US cars, are very good quality automobiles, I don't know what people are talking about, when saying their not. What does Thailand or Japan charge for import tax on a US vehicle? I think the US needs to up the import tax to match countries they do business with, and eliminate unfair competition. Furthermore the US should put a hefty import tax on all imported goods just like Thailand does. How can the US compete with workers that are paid 200 or maybe 300Baht a day, which is probably what Toyota pays it's workers, not even mentioning medical insurance for US workers. Toyota probably doesn't even pay import tax in the US, on the vehicles that are made in Thailand. The US government should pull it's head out of its ass, and look to taking care of it's own people. Stop unfair trade practices which costs the US jobs. Who cares that their a developing economy, or third world country, let them take care of themselves. Lets concentrate on our own.

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## panama hat

> Originally Posted by panama hat
> 
> 
> Germany, France and Japan have unionised workforces, their wages are high, the social contributions are high etc . . . 
> 
> These country's auto-makers have diversified, started up plants in consumer's countries, made quality their modus operandi, went with or started the trend for fuel efficiency, looked at consumer needs and wants . . . 
> 
> . . . while the US automakers kept making gas guzzlers, continued to make uncompetitive and low-quality cars. 
> 
> ...




Absolutely, but the Ford, Holden, Vauxhall, Opel have zero in common with their cousins in the US.  (Ok, probably not zero as someone will surey point out).

How many cars does the US export?  certainly not as many as Japan . . . definitely not as many as Germany.  Hardly as many as KOREA.  More than France?  How about Italy?   Let's low-ball and call it Malaysia  (being facetious here)
.  
Actually, Canada is full of American cars . . . other than that, possibly Mexico and then that's pretty much it.


Technology.  World trends.  Quality.  Customer requirements.  And the list goes on.

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## chitown

> 1 in 10 jobs in the US rely on it. What a ridiculous situation to be in, in a country that probably spends more on trying to put men on mars than on trying to develop efficent engines


I certainly felt safer and enjoyed driving my Lincoln Navigator more than I do the vehicle I now have in Thailand. The Navigator beats the stuffings out of a Honda Jazz or a tuktuk any day.

Was it a gas guzzler? I never noticed. I filled it up when it needed it.

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## chitown

> I think the US needs to up the import tax to match countries they do business


here here! I also think that the US should mirror the immigration policies of other countries as well. 

If a country (thinking of Thailand of course) won't let a guy own land if he marries a national then the US should also impose that. Have to get a non immigrant VISA in a country? 

The US should do the same. I would love to see Thais doing the 90 day VISA reports, 30 day border runs and providing income reports to stay in the US. Never give citizenship, just force them to lick butt to get permanent residence status!

Of course I would want them to be lenient to Mrs. Chi and other TD member's wives!  :Smile:

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## panama hat

^ But that would drag a normal country down to the level of a corrupt, inefficient, sleazy . . .you get my drift


(Huge opening for 'witty' comments)

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## Texpat

Why would tightening immigrant requirements drag a country down?
Especially when there's a huge illegal problem already?
I agree with chitown on that point, but building and selling selling cars is a business. They should live or die by their merit.

Funny, I believe Thais view foreigners within their borders as a _business_.

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## Fabian

> Germany, France and Japan have unionised workforces, their wages are high, the social contributions are high etc . . . 
> 
> These country's auto-makers have diversified, started up plants in consumer's countries, made quality their modus operandi, went with or started the trend for fuel efficiency, looked at consumer needs and wants . . .


French car makers and quality, you are joking there, right?

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## Muadib

Do US auto makers deserve a bailout, NO...

Will they get a bailout, YES...

US auto makers have been behind the curve for 30 years... Partly due to being obstinate, partly due to being in collusion with big oil to continue building gas-guzzlers... Fat, dumb and happy... Now that the rooster has come home to roost, they're scampering around going Oh, poor is me... 

Let them go bankrupt... Serves them right.. Along with the focking Unions that have pressed them into this position...

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## panama hat

> French car makers and quality, you are joking there, right?


The old jokes are . . . old.  


As for Italian cars . . . well, there you would have  a point

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## bkkandrew

> I certainly felt safer and enjoyed driving my Lincoln Navigator more than I do the vehicle I now have in Thailand.


Fok me Chi, what did you have in the US, a stretch Hummer? When you gave us all a ride back from Timba's we must have fit 10 people in with most of us stretching out legs!!??

Thanks for the lift anyway. :Smile:

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## Fabian

Well, I think Scampy wasn't riding so save.

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## chitown

> Fok me Chi, what did you have in the US


The last couple I had were some real Arab pleasers!!!

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## Rural Surin

> They should bail them out. US cars, are very good quality automobiles, I don't know what people are talking about, when saying their not. What does Thailand or Japan charge for import tax on a US vehicle? I think the US needs to up the import tax to match countries they do business with, and eliminate unfair competition. Furthermore the US should put a hefty import tax on all imported goods just like Thailand does. How can the US compete with workers that are paid 200 or maybe 300Baht a day, which is probably what Toyota pays it's workers, not even mentioning medical insurance for US workers. Toyota probably doesn't even pay import tax in the US, on the vehicles that are made in Thailand. The US government should pull it's head out of its ass, and look to taking care of it's own people. Stop unfair trade practices which costs the US jobs. Who cares that their a developing economy, or third world country, let them take care of themselves. Lets concentrate on our own.


How many American cars will you find around the world? Nil.....{and please don't include Aussie or Irish Fords - they're not American - only in name}.

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## bkkandrew

Going back to the OP, I have posted an article on my main thread which explains the perverse effect of bailouts. The one posted deals with the absurd Fannie/Freddie bailout and has hair-raising consequences...

https://teakdoor.com/us-domestic-issu...tml#post836475

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## mad_dog

Pointless protectionism proposed promotes pityful pay.

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## Rural Surin

> Pointless protectionism proposed promotes pityful pay.


Spot on Dog, industries as the auto makers will always know that they can run to Uncle Sugar yet continue to practice as they will.

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## mad_dog

> Originally Posted by mad_dog
> 
> 
> Pointless protectionism proposed promotes pityful pay.
> 
> 
> Spot on Dog, industries as the auto makers will always know that they can run to Uncle Sugar yet continue to practice as they will.


Yep. Every company in the country due to die a natural death will be beating down the door to the White House with a golden begging bowl. Supporting one company with government funds would set a dangerous presedent and lead to a surge in corporations looking for a free handout. Once you refinance one business, say on the grounds of the damage the job losses would cause, it would leave the way for every other corporation to come to the US government with a similar request. If a business is no longer viable then it should close; a bail out would just delay the inevitable.

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## Norton

> How many American cars will you find around the world?


Reckon it depends on what one defines as "American".  Very few cars manufactured in the US and imported.  All the large auto makers have manufacturing and sales operations throughout the world and what they produce are cars based on various models sold globally under other names.  GM for example, sells Buicks in China which are essentially US market designs. All but the Commodore Holden models in Aus are rebadged GM Opels.  Pickups sold in Thailand as Chevrolet's are Isuzu based designs and others are Opels with a Chevrolet badge.

Unlike the Japanese, US car companies continue to view themselves as "US automakers" and have failed to properly restructure to reduce cost and dupilication.  Duplication in design facilities, dealer networks and the like place a heavy cost overhead resulting in a none competitive position.  GMs failure over the years to think global and act local is fundamental to it's downfall.

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## panama hat

> Why would tightening immigrant requirements drag a country down?
> Especially when there's a huge illegal problem already?
> I agree with chitown on that point, but building and selling selling cars is a business. They should live or die by their merit.
> 
> Funny, I believe Thais view foreigners within their borders as a _business_.


Not at all what I meant, I didn't state it clearly . . . trying to be witty = failed. 

What I meant was that a tit-for-tat in this case wouldn't solve anything.  I am in favour of tighter immigration requirements for any country.

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## jim1176

bail out only with huge cuts in union freebies and change all top management

minimum wage for all until profitable

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## Texpat

Minimum wage? Surely you jest.
They wouldn't get out of bed for anything less than $50/hour. Got that boat/house/vacation to pay for.

Walkout straps the company.

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## jim1176

> They wouldn't get out of bed for anything less than $50/hour. Got that boat/house/vacation to pay for.


Let them stay in bed then .. if company cannot make money no reason for workers to make money

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## Texpat

I agree with your underlying premise, but your means toward achieving it are too  simplistic. The company also must do its best to maintain its legacy costs or it loses credibility as a fair employer.

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## Rural Surin

> Originally Posted by mellow
> 
> 
>  I think the US needs to up the import tax to match countries they do business
> 
> 
> here here! I also think that the US should mirror the immigration policies of other countries as well. 
> 
> If a country (thinking of Thailand of course) won't let a guy own land if he marries a national then the US should also impose that. Have to get a non immigrant VISA in a country? 
> ...


Your theory has holes though, Thais are well known as the least of Asians to emigrate. As comparative Asian immigration to the West....try the Chinese, Filipinos, and Koreans {especially to the US}.

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## Rural Surin

> Originally Posted by Fabian
> 
> French car makers and quality, you are joking there, right?
> 
> 
> The old jokes are . . . old. 
> 
> 
> As for Italian cars . . . well, there you would have a point


Probably the only reason Italy remains a G-7 {G-8?} member, their long history of auto influence on the world. Their everyday common quality - I couldn't speak of. Perhaps. Perhaps not. I do know, historically, in the 50's/60's/70's one could find a wealth of Italian vehicles throughout Europe,Africa, Asia, Middle East, and Latin America like no other national manufacturer. This is no longer the case anymore, for the Italian automobile fortunes have ebbed considerably. They still have {if not image} the reputation for the "speciality" sport-types made to order. Ferrari, Lamborghini, Maserati. Remembering that old mechanics humour - {F}ix {I}t {A}gain {T}ony......55555

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## bkkandrew

> I agree with your underlying premise, but your means toward achieving it are too simplistic. The company also must do its best to maintain its legacy costs or it loses credibility as a fair employer.


So you want your tax dollars to pay for people to be overpaid, producing products that people don't want at prices no-one can afford?

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## Texpat

No, I don't. I'm not in favor of a bailout -- but if it's inevitable -- nobody will build cars for minimum wage. If it's inevitable, if the government is to become a major stakeholder, it needs to redefine strategy and pare down operating costs.

The whole idea stinks to me. Let 'em sink or swim on their own merit.

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## bkkandrew

^Perhaps if they did pay minimum wage with the prospect of better when things pick up, the resultant downsizing would benefit all and you would be left with a lean company with motivated workers?

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## Texpat

I'm telling you, again -- nobody's going to build a car for minimum wage. Even migrant workers won't. You'd end up with a worse situation than exists now. A bailed out company that can't attract workers. At least now there's a possibility that natural market forces will impel US automakers to shape up or ship out.

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## bkkandrew

> I'm telling you, again -- nobody's going to build a car for minimum wage.


They might if the alternative was no job and no way of getting a job.

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## chitown

^ Bkkandrew,  Illegals won't even work for minimum wage.

My ex wife wanted a live in maid many years ago. Illegal Mexicans in Chicago were demanding $2500 a month in cash, plus free room and board. That was many years ago and I can't imagine what the cost would be today.

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## plorf

Definetely against bailout, I only hope that Germany and France won't copy their american counterparts.. America and the world has to learn that they can only spend what they have/earn and if a company doesn't make profits then it has to learn doing so or go bust.

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## Fabian

^ Doesn't look like there won't be no copy. Today Opel executives are talking with the government about their bailout and it seems like the government is willing to help them, they just want to make sure the money is not going to GM.

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## plorf

^ I am aware of that, I don't really know why but I just hope that it won't happen... Europe is protectionist enough, no need to finance failing industries. 
There was a huge outrage in Switzerland when the government bailed out UBS, despite all the securities people change to other banks in masses. 
Burdening future generations because of an unwillingness to live less comfortably now..

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## Norton

> they just want to make sure the money is not going to GM.


It will.  No way to stop it.  Opel is part of GM Germany, is part of GM Europe, is part of GM.  Any money given to Opel will benefit GM financial position.

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## rreexx

The Yanks have always built shit gas guzzling cars for themselves.
They cannot compete with the German & Jap cars...never will.
Compare the USA with the ancient cultures....Roman....Greek......they all eventually fail.
The US will take less time to fail.....another 50 years ???.....optimistic I think.

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## KID

> The US automakers are so far behind the curve that they do deserve to move into bankruptcy. 
> 
> Their forward vision is so archaic that is is senseless pouring more good money in after bad. Perhaps it would be in their best interests to be taken over by an outside automaker - eg. Toyota, Honda... 
> 
> I've been privileged to hear Toyota's engineering director discuss their strategy & forward vision - stunning stuff. Toyota didn't get to where it has by crying 'help me' when their business model suffered - they strategised, re-focused & moved ahead. The Japanese are strategic planners, whilst the US automakers have tended to rest on former glories.
> 
> Let the Detroit three move into bankruptcy.


 

???? i am sure that the united states governments taxes breaks and virtually no import taxes when Toyota first started selling cars in the states had nothing to do with there success though ehhhh????

stupid move on the governments part though!!!!!

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## TSR2

Funny thing about American Autos, the Yanks can,t /won,t build good cars  but can build some of if not the best Trucks in the World, Why is that do you reckon

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## Panda

> Minimum wage? Surely you jest.
> They wouldn't get out of bed for anything less than $50/hour. Got that boat/house/vacation to pay for.
> 
> Walkout straps the company.


Surely you cant be serious Tex?
$50 an hour is way over the top!!!

I honestly don't know what these US car plant labourers earn, but I seriously doubt it would be anywhere near $50 an hour except maybe for a very small proportion of highly skilled technicians.

Correct me if I am wrong, but my research shows US minimum wage to average around $7 an hour in most states. 
Would you get out of bed and go do a 40 hour working week for $280?
I wouldn't. Well, maybe if I was really desperate, but I certainly wouldn't be there for very long.

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## Travelmate

Let the Yank Tanks sink!!

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## Thormaturge

Superbama has gone on record as wanting to bail out GM.

Wait for the howls from Boeing when this is used as an excuse for Europe to subsidise Airbus industrie.

Worms and cans come to mind.

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## jim1176

> I agree with your underlying premise, but your means toward achieving it are too simplistic. The company also must do its best to maintain its legacy costs or it loses credibility as a fair employer.


It is true my view is very simple but I am just going after the essence, let higher ups implement the wisdom.  The legacy cost is also a problem. Why should taxes from someone making $10 - 15 an hour, or $7 at Wal-Mart, support this special group of people who did nothing more than extort a living from what would otherwise be a viable industry. They have hurt the country, let them go without.

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## Thormaturge

Can Starbucks get some "Tarp" funding?

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## Texpat

Lockheed and Raytheon could do with a taste of the pie too.  :Smile:

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## watterinja

This image - if its what I seem to think it is - is vile & so incredibly racist.
 :Sad:

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## Texpat

Why is it offensive?

It's satire: The use of irony, sarcasm, ridicule, or the like, in exposing, denouncing, or deriding vice, folly, etc.

How is it racist? Why is it vile? I think it's funny -- especially in retrospect.

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## Gaudente

> This image - if its what I seem to think it is - is vile & so incredibly racist.


Why ? The guy's job might not be great, but the he should enjoy the view big time !

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## Gaudente

...here's the main reason for GM and automakers trouble :
Should We Really Bail Out the Big Three Automakers with $73.20 Per Hour Labor? - Seeking Alpha

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## Gaudente

80% of people here seem to believe GM will get the bailout.
You can buy your bet here at just 36% of nominal value Intrade Prediction Markets

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## Norton

> Lockheed and Raytheon could do with a taste of the pie too.


A taste?  They ate most of the pie already!  Raytheon 5 year return 71.68%, Lockheed 5 year return 55.14%.  There is profit in war.


GM 5 year return -84.14%
Ford 5 year return -9.68%

Toyota 5 year return 3.02%
Honda 5 year return 9.6%

Do you see a pattern here?  Profit can be had in the auto industry if it is managed properly.  Ford took some good measures to stop the bleeding and might be worth helping.  GM is a basket case and always will be.  

I don't see Toyota and Honda running to the Japanese government whining they need help.  The American auto industry, in particular GM,  is a bloated, spoiled child who has been living off and being protected by the government in one form or another for far to long.  

Euthanization is the only humane way to stop their infernal suffering!

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## ceburat

Screw all of them; automobile industry, housing industry, loan companies, etc, etc., including unions. Free enterprise, sink or swim on your own merits, not your neighbors tax money.

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## jim1176

> This image - if its what I seem to think it is - is vile & so incredibly racist.


You like  :Smile: 

I agree with you but think it funny also ..... 

Time for a change .... 



What do you think?

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## mad_dog

Protectionism will ruin the world economy. No to bail outs ! no to Jewism !

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## Loy Toy

Yep and because there are over 3 million jobs on the line.

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## jim1176

> No to bail outs ! no to Jewism !


 :rofl:  :rofl:  :rofl:  :rofl:  :rofl:  :rofl:  :rofl:  :rofl:  :rofl:  :rofl:  :rofl:  :rofl:  :rofl:

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## charles1949

i am still living in the united states and plan on moving to thailand the end of 2009. the car companies have not changed for years and are slow to change..

i am afraid they will get a bailout but i am opposed to it....let them go into bankruptcy.

everyone is wanting a bailout now and when will it stop.

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## Jet Gorgon

I'm like Norts and others -- The poll and OP are different. Will the Govt bail them out -- Obama has already said yes (Bush is opposed). Do I want a bailout? No.




> All this talk of unionisation and the like being the core problem is nonsense. The main reason for the car companies not doing well is that they simply cannot compete with the competition in price or quality. 
> 
> Germany, France and Japan have unionised workforces, their wages are high, the social contributions are high etc . . . 
> 
> These country's auto-makers have diversified, started up plants in consumer's countries, made quality their modus operandi, went with or started the trend for fuel efficiency, looked at consumer needs and wants . . . 
> . . . while the US automakers kept making gas guzzlers, continued to make uncompetitive and low-quality cars. 
> Export . . . how many US cars do you see in Thailand, Australia, Germany, France, Japan, South Africa, Denmark etc . . .


A little more homework needed there, hatter. The unions have indeed strapped the big three and cut into operating earnings with all their benefits and high wages. GM new hires got $75-$78 an hour (now stripped down to $28 or so), but what about the long-term guys? Probably get $100 an hour to do the same stupid job. Note that none of the Asian carmakers' plants in the US are unionised.
True, the mgmts have screwed up as well.
Overseas, GM and Ford are doing well: 65% of GMs 1Q08 sales was from overseas (mostly in the BRICs) and almost 40% of its op profit was from emerging markets. GM & Ford have also had JVs (the only thing allowed) in China and do quite well there.
Let them file for Chapter 11, restructure, kick out the UAW, and may the fittest survive. 



> Expect the bail-out for sure. This is the usual insane move by the US govt to continue to subsidize rotten and undeveloped business practices.


Untrue. The only bailout under Bush has been the fin industry, which was a necessity. Paulson has only dished out $290 bil so far -- today, he said he wantkeep the rest for Obama to divvy up, but also wants to plunk the cash into bank equities instead of buying off their bad loans -- will have to see about that about-face change; I know Pelosi and her pals have earmarked a bunch of the funds for porkies unrelated to finance -- gotta get the data. The auto industry is not necessary to the economy; Thatcher let the coal industry die (well, she did help to push it off the cliff). The UK survived. 



> Originally Posted by Smeg
> 
> 1 in 10 jobs in the US rely on it.
> 
> 
> Another nonsense "statistic" used by supporters of the bailout. There may be this many jobs involved in the auto industry but implying they would all be out of work if the big three goes bust is bollocks.
> If they have any intrinsic value, successful auto manufacturers will buy their "good" assets and the end of the world will be averted. Bailouts are a crutch for bad business. What next? If Microsoft has a bad year will they be bailed out? There is no end.


I think that's including people who pump gas and work at the car wash.
I'm waiting for the airlines to put their hats out next if the auto guys get help.



> The FED is hell-bent on accelerating national bankruptcy and default by this bailout route. Jaysus, even individual cities and real estate agents are asking for bailout funds!


Ain't the Fed, it's the govt. The lame duck Congress is supposed to pass some legislation on this crap this week. Obama will press them to bail out the roadkill, but I'm hoping that what's left of the Reps will vote no or that Bush will veto it. 

We have a similar thread in Issues on this topic. All my links are there, except for the latest GM/Ford info, which is in last week's Economist. Special section on the auto ind in emerging markets.
A survey of cars in emerging markets: Opportunities for carmakers | A global love affair | The Economist

The Paulson info from here:
Lawmakers, Treasury lock horns on foreclosures | U.S. | Reuters

----------


## Panda

> ...here's the main reason for GM and automakers trouble :
> Should We Really Bail Out the Big Three Automakers with $73.20 Per Hour Labor? - Seeking Alpha


$73 an hour is insane. Thats around $150,000 a year for a worker in a car plant.

If thats what they are paying semi-skilled workers they deserve to go broke.

----------


## Happyman

I'm not a number cruncher or a bean counter but the whole setup with these big money companies/government setups just does not make sense!

They juggle numbers and skim off huge profits and then it goes belly up and they run to the government for help !

What about the small companies that d their best - make modest profits - and due to the economic turndown caused by the big boys also go under - can they get help from the government ??? I think not !

A couple of examples of things that have confused my simple ( you earn money - you spend it - you dont earn then you cut expenses and try a different approach ) mind are these .

British Leyland ( RIP) went bust despite government hand outs.

Why ? 
 I was contracted to them at the time and the reason was that they had made a multi million loss that year .

When you looked at it though they had actually made a ( cant remember the numbers now but say ) a 3.5 million profit that year ! 
 The loss was that they expected say a 6 million profit that year and the bean counters had invested it all against their projected profits and couldnt pay up when the call came - a classic example of counting your chickens before they have hatched !!!

Another recent one - and this triggered me off - is the Bradford & Bingley building society/bank in uk.

They are asking for several million from the government at the moment due to the present situation .

The CEO has gone public and admitted that they had made unwise investment decisions and has tendered his resignation - and it has been accepted - he will leave at the end of the year.

What really gets up my nose is that he will collect his salary about 750,000 GBP plus - and this is the bit I just cannot grasp - a 350,000 GBP bonus !!!!

The world has gone bloody mad ! 

You get a job 
F*ck up
you are not sacked on the spot 
stay on for a few months to get your full salary and a bloody bonus

Where can I get a job like that ?????

----------


## barbaro

> The FED is hell-bent on accelerating national bankruptcy and default by this bailout route. Jaysus, even individual cities and real estate agents are asking for bailout funds!


Indeed.

And I just put an article from the _Wall St. Journal_ in the "Strongest Economy in the World" that reports that:

Many companies with Defined Pension Benefit programs lost so much money that they are underfunded and are below the floor of 80%, and some will go as low as 57% (projected) next year.

This may mean, those with Traditional Pensions, will be getting less (depending on how the markets continue to go).

These pensions groups are _asking for bailout money, too!!_


A sinking ship....

----------


## Travelmate

let the Yank Tanks sink!!

----------


## TSR2

> Where can I get a job like that ?????


 
Try Social Services, when a kid gets abused /murdered say your sorry, I will learn my lesson (being a stupid [at][at][at][at]) get suspended  for 1 day, Bingo  back to the job,

----------


## Gaudente

> Where can I get a job like that ?????


I am afraid they are all reserved to the ruling "elite" and their relatives.

----------


## Gaudente

> Protectionism will ruin the world economy. No to bail outs ! no to Jewism !


another case of bad humour that turns into unvolontary wisdom.
It's becoming much more common than the old bad seriousness turning into unvolontary humour.

----------


## mad_dog

Any company that uses the privatised profit and socialised loss business is beyond saving. In times of crisis giant employers should be offered government loans with low interest rates. An open checkbook aproach akin to post 9/11 or the recent bank bailouts should be avioded at all costs. Capitlaism works by following man's self interested nature. If companies know that failure will be rewarded by government subsidies, which is  counter-intuitive, it will actually encourage businesses to fail.

----------


## Rattanaburi

Not sure what will happen. I would guess some sort of a bailout. The enormous salaries for some workers should go but the bosses should all be knocked down to zero for the coming years and into a set maxium pay for eternity in my view. And all the bosses should move all their investment money in other areas such as banks and the US economy into their company. Why should management be allowed to put their money anywhere else? All benefits to employees and management should be tied long term to company's stock so they take interest in the company forever. Management's pay should not only reflect positive outcomes. If the company can't sell the management should take pay cuts first, pay cuts that are able so far as to make the managment actually owe the company money. (Sounds like something archaic) Bad managers shouldn't be able to walk away with cash for their failure. Sounds extreme but if a bailout goes through they own it to the American people. They should rework the pensions that are paying out now so that they too are reflective of the current situation. Where the company is now is a result of what past employees did. And afterall those employees will keep some sort of pension if the US taxpayers help out.

----------


## Jet Gorgon

^ Iacocca did that. $1 annual salary.

----------


## Rattanaburi

*Finger-pointing begins as Senate nixes auto vote*

Full story:  Finger-pointing begins as Senate nixes auto vote - Yahoo! News

WASHINGTON – A Democratic Congress, unwilling or unable to approve a $25 billion bailout for Detroit's Big Three, appears ready to punt the automakers' fate to a lame-duck Republican president. Caught in the middle of a who-blinks-first standoff are legions of manufacturing firms and auto dealers — and millions of Americans' jobs — after Senate Democrats canceled a showdown vote that had been expected Thursday. President George W. Bush has "no appetite" to act on his own.
U.S. auto companies employ nearly a quarter-million workers, and more than 730,000 other people have jobs producing the materials and parts that go into cars. About 1 million on top of that work in dealerships nationwide. If just one of the auto giants were to go belly up, some estimates put U.S. job losses next year as high as 2.5 million.
"If GM is telling us the truth, they go into bankruptcy and you see a cascade like you have never seen," said Sen. George V. Voinovich, R-Ohio, who was working on one rescue plan Wednesday. "If people want to go home and not do anything, I think that they're going to have that on their hands."

----------


## plorf

I wouldn't have thought that would happen so quickly, but I already disagree with Obama before he's the president. No bailout.

----------


## Thormaturge

I was impressed with the Republican (N Carolina I think) who said the car manufacturers that had placed factories overseas should be obliged to keep the US factories open and cease relocating if they expected any bailout funds.  At least somone has a grip.  Not much point bailing out a company if the employees are mostly in Mexico.

----------


## watterinja

> I was impressed with the Republican (N Carolina I think) who said the car manufacturers that had placed factories overseas should be obliged to keep the US factories open and cease relocating if they expected any bailout funds.  At least somone has a grip.  Not much point bailing out a company if the employees are mostly in Mexico.


Excellent point. This should apply to *any* manufacturing company seeking financial assistance.

I could see this day coming years ago. They have outsourced until there are now very few skilled personnel remaining at home base. Foolishness in the extreme. It had to end sometime.

----------


## watterinja

.....

----------


## Norton

> "If GM is telling us the truth


Problem is no one knows the "truth" as it relates to how bad and for how long the economies of the world will continue to collapse.  The $25B the auto industry is asking for assumes an up turn by the end of next year.  Should the economy and their sales fail to recover then they will be back for more.

The issue to me is should the government be bailing out any industry.  My opinion is no.  Once started there will be no end and the government will be put in the position of picking which industries will win or lose the bail out lottery.  As a contribution to GDP the auto industry is way down the list.  America's infatuation with the automobile and it's subsequent concern re the loss of the big 3 are not in line with the realities of their importance to the overall US economy.  All the hoopla about bailing out the big 3 is based on the inflated perception the public has about the auto industries contribution to GDP.  Even should the auto industry prosper with the bailout, it will not do much to right the economy and conversely if they go bankrupt will have little effect.  Aside from "American" pride, the bailout has no value.

----------


## TSR2

One Senator grilling the hungry three said it was ironic to witness these guys arriving in their corporate jets with a begging can in their hands, they said it was for their security !! who from ? shareholders, Typical behaviour of American Corporate leaders




11

----------


## Rural Surin

Today {American time}, the US Congress has shelved and delayed any discussion or debate about the whining pricks in Detroit. They will not even give it a go until Obama is sworn in.

----------


## Spin

> Your opinion: Bailout or Bankruptcy?


I didnt read the thread so I have no idea if anybody has already said "bailout and then bankruptcy anyway" Good money after bad, same as happened in the UK. 
Leave carmaking to the undisputed champions, the Japanese and the Germans.

----------


## melvbot

BBC NEWS | Business | No agreement for US car bail-out

*US politicians have told the crisis-hit "Big Three" carmakers to come up with their own viable recovery plan if they want a $25bn (£17bn) government rescue.

*


> The chief executives of General Motors, Ford and Chrysler pleaded for the $25bn bail-out before two congressional committees this week, but came away empty-handed. 
> *They were lambasted for making the trip to Washington by private jet.*


Thats says it all for me.


I didnt notice TSR2's post until now.

----------


## Travelmate

> One Senator grilling the hungry three said it was ironic to witness these guys arriving in their corporate jets with a begging can in their hands, they said it was for their security !! who from ? shareholders, Typical behaviour of American Corporate leaders


Yuo, let the Yank Tanks Sink!

----------


## Jet Gorgon

> Originally Posted by Rattanaburi
> 
>  Your opinion: Bailout or Bankruptcy?
> 
> 
> I didnt read the thread so I have no idea if anybody has already said "bailout and then bankruptcy anyway" Good money after bad, same as happened in the UK. 
> Leave carmaking to the undisputed champions, the Japanese and the Germans.


I think they could turn around if they filed for Chapter 11, kicked out the unions, streamlined the factories, and got some innovative, sexy new sedans on board. Trucks will always be a mainstay in the US, but they could do with improving fuel efficiency on those as well. I dunno what's going on in their R&D depts. GM appears to be upping production and model types in China.

----------


## KID

I don't know where you guy's are coming up with this $75-$100 wage nonsense for the auto workers

I haul loads into gm and ford here in Kansas city, the starting wage is $14 an hour and the line workers top out at $27 an hour after years of service

however ,they do have really good insurance 

thing is that they are constantly out sourcing the jobs to companies who run the docks and stockrooms putting non company workers working side by side  with company workers

blaming the workers is not going to cut it, look and see what the executive's and ceo's make and thats where you will find the pork fat !!!!!!!!

----------


## Spin

> I think they could turn around if they filed for Chapter 11


How long would they be in Chapter 11? Whos gonna buy a new car from a maker that is chapter 11? 

I reckon what congress should have done is ordered Paulson to give them 25billion of his "really big number" pile of money and then said if you bugger it up dont come back again here asking for more.
That would have killed two birds with one stone as Hank clearly hasnt really got a clue what to do with the money he has and congress could have helped him out a bit :Smile:

----------


## Jet Gorgon

> I don't know where you guy's are coming up with this $75-$100 wage nonsense for the auto workers
> 
> I haul loads into gm and ford here in Kansas city, the starting wage is $14 an hour and the line workers top out at $27 an hour after years of service
> 
> however ,they do have really good insurance -- more like legacy items, ie, pensions and benefits, pls see below
> 
> thing is that they are constantly out sourcing the jobs to companies who run the docks and stockrooms putting non company workers working side by side with company workers
> 
> blaming the workers is not going to cut it, look and see what the executive's and ceo's make and thats where you will find the pork fat !!!!!!!!


The $75 figure comes from adding in all their bennies. $14 an hour to start? Who's getting that, a janitor? Sure, all execs in any industry get paid more. Do the auto guys deserve it? No. I agree with you there.




> Originally Posted by Jet Gorgon
> 
> I think they could turn around if they filed for Chapter 11
> 
> 
> How long would they be in Chapter 11? Whos gonna buy a new car from a maker that is chapter 11?


How long? Until they smarten up, streamline, get some competitive products out there. They'd have to have fire sales. It's not like the parts and service industry would fold anytime soon. Would suppliers to the Big Three be feked? Probably. They would have to turn to other biz.
The Japanese were smart when they moved in to the US. Set up plants in bumfek America where most folks make minimum wages. Gave them double and bonuses, which keep the unions out. The Big Three should think about that. They still need to get products that people want to buy, tho. And get rid of the unions.


To get back on the road to viability, experts said, Detroit's Big Three are going to need more than government money. They're likely to need the government taking over their "legacy costs," the pensions and health-care benefits they made to generations of workers during better times.
"This is not a bailout of the auto industry. The U.S. auto industry is doing just fine," said Michael Hicks, an economist at Ball State University's Center for Business and Economic Research. "It is a bailout of the United Auto Workers, and regardless of what happens to the bailout, it will simply prolong a period of poor performance."
...
"It's not really the wages of the guys at the factory that are the problem. It's the legacy costs — and the other union or labor costs — that are so damaging," Hicks (an economist) said, noting items such as full pay for idled UAW workers and janitorial staff receiving union wages that saddle manufacturers with higher costs than the transplants.
General Motors' sales plunged 45 percent in October, and its market capitalization is around World War II levels. GM last year reached an agreement with the UAW to establish a health-care trust fund called a Voluntary Employee Beneficiary Association.
The association allowed GM to transfer off its balance sheet — effective Jan. 1, 2010 — some $51 billion in promised health benefits. The money will go into a UAW managed fund that will invest the money to help pay for the legacy costs.
Nation & World | What about bankruptcy option? | Seattle Times Newspaper

----------


## sabang

> It's the legacy costs


The same legacy costs that GM underfunded for many years, in spite of many warnings. That is why they are so big now.

GM management is a long standing joke- incompetent, coming out with mediocre products, underfunding research, ignoring the trends- but generously feathering their own nests. All of the automakers even flew in seperate Private Jets to come meet with the government, begging bowl in hand.

Screw 'em. Ford can survive- as for GM, just auction off the best assets to someone that knows what to do with them, such as Toyota or Honda, as far as I'm concerned. GM has ben considered a lame duck since I was a fledgling stockbroker, 20 years ago.

----------


## barbaro

> Originally Posted by KID
> 
> 
> I don't know where you guy's are coming up with this $75-$100 wage nonsense for the auto workers
> 
> I haul loads into gm and ford here in Kansas city, the starting wage is $14 an hour and the line workers top out at $27 an hour after years of service
> 
> however ,they do have really good insurance -- more like legacy items, ie, pensions and benefits, pls see below
> 
> ...


The article I cut-copied-and pasted shows on GM worker of 35 years at the company maxing out at $60,000 per year, _gross, before taxes._

This is a very LOW wage.

----------


## Jet Gorgon

^ Geez, I dunno, MM and All. Many of us copied news article about union wages and they all vary! As Bugs noted somewhere, the higher figure likely includes the legacy payments. 
Worker for 35 years, MM? Weird. Their pensions kick in at 30 years as I heard it.

----------


## Panda

> Originally Posted by Jet Gorgon
> 
> 
> 
> 
> 
> 
> 
>  Originally Posted by KID
> ...


SOMEBODY has got to be fudging the numbers here.

----------


## Jet Gorgon

^ We all have quotes with linkies on one of these threads. Libbie press at it again. :Smile:

----------


## Rattanaburi

Would anyone change their original prediction now? Is GM or Ford going to go off a cliff? Is it time to buy their stock?

----------


## Rattanaburi

They say the whole auto industry in the US will suffer if GM goes bankrupt. I guess suppliers supply both the Japanese plants and the US plants. I wonder if the Japanese want to go half on a bailout? Sounds crazy but we are in crazy times. But when Arabs wanted to buy the ports Americans became defensive.

----------


## Travelmate

Let the Yank Tanks sink!

----------


## Deck Ape

Our seafarers union just renegotiated the contract we have with my company. The unions get paid so many different ways. I think the company contributes something like $150 a day to my union every day I'm on the boat. That's above and beyond wages.

Probably the only people who really understand the true cost of unionized labor to the U.S car industry are high level labor and management type people.

----------


## Reaper

In 1986, Toyotalured in part by nearly $150 million in tax breaks and other incentivesbuilt a massive manufacturing plant here. And in the years since, the bucolic landscape has been transformed. The 1,300-acre plant, in which Toyota has invested $5.3 billion, produces a car roughly every minute. In the process, Georgetown's population has doubled. In fields where farmers once grew tobacco and raised cattle, McMansions, apartment complexes and condominiums have sprouted. A 150,000-square-foot upscale retail center is rising near the Toyota plant, the better to serve its 7,000 employees. "There is no doubt the state's investment in Toyota has repaid itself many times over," says state Sen. Damon Thayer, a Republican who represents Georgetown in the Kentucky General Assembly.

Brian Howard, 42, a team leader in painting operations and a 20-year veteran of the plant, is pleased with the way things are going. He enjoys high wages and cheap health insurance$74 per month for his family. "They've told us for years that they've planned for a rainy day," he said. "Well, it's here and we're still doing well compared to the Big Three."

Time was, the Big Three were the U.S. auto industry. No longer. Over the past two decades, enticed by cheap labor and massive incentives, a second auto industry has emerged: nonunion, Southern-based and foreign-owned. Large plants, with names of Asian and European carmakers emblazoned upon them, now dot the Southern landscape alongside Civil War memorials.

To hear the rhetoric wafting down from Capitol Hill of late, you'd think that Toyota, Hyundai, BMW and the rest are as all-American as Mom and apple pie. And, in many ways, they now are. Sen. Mitch McConnell of Kentucky made an impassioned plea on the Senate floor for his colleagues to oppose the $15 billion aid package the House of Representatives had approved for General Motors, Ford and Chrysler. "Labor costs need to be brought on par with companies like Nissan, Toyota and Hondanot tomorrow, but immediately," he said. 

In San Antonio, the Toyota Tundra plant lay idle for three months this fall, though Toyota hasn't laid off anyone. Instead, according to Richard Perez, president and CEO of the Greater San Antonio Chamber of Commerce, Toyota offered the city "a whole bunch of folks who need to get busy" (San Antonio put them to work on beautification projects). Of course, Toyota has resources to act in a more paternalistic mannerin part because the parent companies aren't saddled with the burdens of providing health care and retirement for workers in home markets.

Toyota's Kentucky operations, for one, support 28,000 jobs in the state. In 2007, according to the Association of International Automobile Manufacturers, foreign automakers employed 92,700 workers directly and 574,500 indirectly accounting for 33 percent of U.S. auto production. By contrast, the Big Three employ about 240,000 workers.

Above all, these states had longstanding cultures that made it difficult for unions to organize. "When the manufacturers were deciding where to open plants, they chose right-to-work states because they wouldn't have to use union labor," U.S. Sen. Johnny Isakson of Georgia tells NEWSWEEK. Indeed, none of the major auto-assembly plants in the South is unionized.

Gross: The Second Auto Industry | Newsweek Business | Newsweek.com

----------


## gjbkk

So far I have ignored this thread for a simple reason that the U.S doesnt make a decent vehicle. 

They have ignored progress so let them perish, its as simple as evolution.

----------


## TizMe



----------


## jim1176

Here is my latest wisdom for the car companies.

I approve of the bailout under this condition.

To qualify for bailout funds, UAW workers, and all other GM, Chrysler, Ford workers must accept a wage rate of 80% of what the non union foreign car companies pay UNTIL THE COMPANY IS PROFITABLE AND CARS ARE OF EQUAL QUALITY. 

TAKE IT OR LEAVE IT you lazy bunch of unionized asswipes!

It is time to call it like it is, Unions are nothing more than EXTORTION MACHINES hurting the companies and the country

----------


## Thormaturge

What I fail to understand is that these comapnies all have acres of unsold cars and are now being handed millions of dollars to keep these unsold cars and produce even more.

Deep discounts for a short time span would clear the stock, put money in the bank and keep dealers and workshops open without any input from the government.  OK the manufacturers would take a loss but that is what happens in a recession.

ALSO Ford is receiving nothing because it is doing better than GM and Chrysler.  SO now that the two less efficient manufacturers are being supported by the Fed 
Ford are going to find it harder to get credit from suppliers.  

Why is Chrysler being underpinned for a second time?  Put the thing out of its misery.

----------


## sabang

It's crazy all right- totally anti competitive to bailout the asswipes at the expense of the decent companies. For that matter, a profitable foreign company is still better for the domestic economy than a locally owned basket case- they pay tax!

The market needs to shrink- theres no room for the big 3 now, they've fallen too far behind. Strictly speaking, both GM and Chrysler should be on the chopping block- but I reckon theres an argument to be made for saving Chrysler, or at least for it being taken over. It has some decent product developments under way- it is it's weak financial structure that puts it in imminent peril. 

Other than emotional or populist arguments, there is really no case for GM that i can see. Buyers can be found for those bits of this blundering behemoth that are worth persevering with.

----------


## Rattanaburi

Lots of good ideas. Don't Japanese CEOs make much less than their American counterparts?

----------


## Panda

> Here is my latest wisdom for the car companies.
> 
> I approve of the bailout under this condition.
> 
> To qualify for bailout funds, UAW workers, and all other GM, Chrysler, Ford workers must accept a wage rate of 80% of what the non union foreign car companies pay UNTIL THE COMPANY IS PROFITABLE AND CARS ARE OF EQUAL QUALITY. 
> 
> TAKE IT OR LEAVE IT you lazy bunch of unionized asswipes!
> 
> It is time to call it like it is, Unions are nothing more than EXTORTION MACHINES hurting the companies and the country


What exactly does a worker in a Toyota factory in Thailand earn?
At a guess I would think its probably in the vicinity of $US 500 a month.

Do you honestly expect US workers to get out of bed for that? Would you?

In any case its been shown by other posters here that wages make up only around 10% of the total cost of a vechile so a wage cut, even a drastic one like you suggest, wouldn't put the multiple $billions needed into the companies run into the ground by years of mismanagement.

----------


## baldrick

this was an interesting article
Asia Times Online :: Asian news and current affairs




> The bill for the labor peace the companies bought  																	in the 1950s and 1960s has now come due with a vengeance, as medical and  																	retirement benefits going to those former workers are now a significant part of  																	the cost of building today's cars - *on GM's expense ledgers, healthcare is a  																	greater expense than steel. 																	*
> 
> 																	Many anti-UAW and anti-union polemicists note that the auto companies' main  																	problem is its high labor costs; here it is said that, as an example of this,  																	the average GM worker earns a whopping $77 an hour. 																	
> 
> 																	This is highly misleading. No GM worker takes home $3,080 a week (77 x 40) in  																	his weekly pay packet. The $77 per hour figure comes from dividing total UAW  																	worker and retiree compensation by total hours worked. Take out the retiree  																	healthcare costs, and the American nameplate auto companies' worker  																	compensation expenses are roughly comparable with that at the foreign  																	transplant factories in the American South.

----------


## Rattanaburi

I wonder does this mean Ford Tractors may soon be a thing of the past too? Seems to be a lot of those clanking around here in LOS.

----------


## Thormaturge

Chrysler has, today, announced that it is closing all of its production facilities in order to save cash.  The concept of holding a deep discounted sale to raise desperately needed cash has clearly escaped the management.

 Am I missing something here?  Presumably it can no longer claim to be a vehicle manufacturer if it has ceased to manufacture vehicles...

 Who on Earth would buy a Chrysler now?  Let the poor thing die. All that would be achieved by pouring money into the company would be to ensure more cars were stockpiled, unsold, in car parks and showrooms.

----------


## watterinja

^ It appeared that they were shutting production for a month.

----------


## Thormaturge

Ceasing production won't clear the stock or put money in the bank.  If this thing is given public money to build more overpriced cars that nobody is buying then all the public will get for the money is an even larger quantity of unsold cars.

If I were an American taxpayer just now I would be pretty FED up with all the bailout nonsense.

----------


## sabang

Of course, GM/Chevrolet has also taken a 'production holiday' in Thailand. 

The reason given by Chrysler is quite telling though- they say there are buyers for their cars, but as they have no cash they cannot offer financing thru' their credit arm. GM finance has similar problems. No finance to be found elsewhere either.

A certain amount of unwinding of this massive debt triangle is not all bad. Consumers habits are a part of this Mess too.

----------


## Pnow

What happened to Datsun?

----------


## bkkandrew

^After WW2, Nissan were prevented from trading as such by one of the terms of the Japanese surrender, so they traded as Datsun. When the period of the ban expired they reverted to Nissan.

All IIRC, as this was a school memory...

----------


## Panda

> Ceasing production won't clear the stock or put money in the bank. If this thing is given public money to build more overpriced cars that nobody is buying then all the public will get for the money is an even larger quantity of unsold cars.
> 
> If I were an American taxpayer just now I would be pretty FED up with all the bailout nonsense.


Not at all unlike the housing/banking sector bailout.
Over supply and overpriced. And the government wants to keep the bubble going by pumping more public money into the system.

----------


## Muadib

> Pointless protectionism proposed promotes pityful pay.


Much like; Prior Preparation Prevents Piss Poor Performance...  :Smile:

----------


## Rattanaburi

Ford had started changing prior to the downfall a few years ago. I can't remember what happened but I remember the grandson got involved and the fight began back then. They need to make their changes. the funny thing is the Ford cars I see here in Asia are pretty nice compared to the old shat of the past. The economy Chevy's out here look good as well. They just started appearing in force on the streets prior to all this mess. I think the sales here are probably better than in the past. 

Chrysler is shit except for a few models. That company should be disassembled and their better lines should go to whoever will take them. in my opinion, it's a company that appeals to old grandfathers, most of whom are already in the grave. 

Both Ford and GM should be involved in electric trains for America or something like that.


2009 Mustang

----------


## Rattanaburi

2009 Camaro

----------


## Rattanaburi

Ford Focus Sedan

----------


## panama hat

Gm and Chrysler got 13.4 billion . . . the land of free trade strikes again!  (And Bush makes some friends)

Bush unveils US auto rescue plan

----------


## Norton

> Gm and Chrysler got 13.4 billion . . . the land of free trade strikes again! (And Bush makes some friends)


Bush has simply pushed the turd down the line so Obama will have to deal with it.  The "agreement" has no teeth and makes no sense.  The major cost issue is the UAW wage scale.  The agreement sets "targets" but does not make the wage alignment with Toyota, Hinda etc a mandatory part of the restructure.  Also, the agreement states if GM/Chrysler fail to show a go forward plan on how they will restructure to become competitive, they will have to repay the loan.  How will they be able to repay the loan if they go out of business???  :Confused:

----------


## Panda

As Sabang so rightly pointed out, its as much a case of oversupply in a depressed market as anything else. Car plants all around the world are suffering.
Let the weakest go under and the strongest survive. A cull is in order. Thats the way the free enterprise system works.

Propping up all the players with government funded bail outs wont achieve anything. Whos going to buy all this excess production? Theres already hundreds of thousands of new cars sitting in storage waiting for buyers. Why should the government spend the taxpayers money to create more?

----------


## Thormaturge

^
I can see a lot of cut-price Chryslers on the market when the company eventually sinks.  Dodge and Jeep will probably be taken up by Ford.

----------


## Mid

> Bush has simply pushed the turd down the line so Obama will have to deal with it.


EOS

end of story

----------


## bkkandrew

^There is more to it than that actually. As I posted on the 'Note of Caution' thread, the $13.4BN was _exactly_ the remainder of the TARP funds. Congress needs another vote to allow the further $350BN, namely the second half of the $700BN. As Congress is in recess, any further bank failures inbetweentimes now have no funds left in the TARP ready for bailout. And I am sure that AIG are going to be hungry again soon.

----------


## Panda

> Ceasing production won't clear the stock or put money in the bank. If this thing is given public money to build more overpriced cars that nobody is buying then all the public will get for the money is an even larger quantity of unsold cars.
> 
> If I were an American taxpayer just now I would be pretty FED up with all the bailout nonsense.


Not unlike the US solution to their housing crisis. 
If you have an oversupply of over priced products, you just fund the companies to produce more of the same. Makes perfect sense hey?

----------


## Thormaturge

> I am sure that AIG are going to be hungry again soon.


If it is appetite you are thinking about then Chrysler will be ravenous by 20th January. Zero sales as potential customers shop elsewhere, continuing fixed costs and lines of credit withdrawn. Obama will surely put it out of its misery.

----------


## barbaro

The new bailout money (as of December 20, 2008) is probably a band-aid on a bullet wound.

Chrysler LLC and GM are burning cash.

This is only a postponement. 

Who cares?

Stick a fork in them.  They're done.

----------


## EmperorTud

> 2009 Mustang


Nice looking car, pity it handles like a bucket of shit on a roller skate.

----------


## Panda

All the worlds car manufacturers are hurting right now, not just USA. Theres an oversupply on the world market and the buyers just arnt there. Its going to be survival of the fittest. Which is the way the free market is supposed to operate. Governments subsidizing inefficient industries is not in the best interests of anyone long term.

----------


## bkkandrew

Canadian Government to give them $3.3BN as well:

Bloomberg.com: Worldwide

*Chrysler, GM Get $3.3 Billion Canada Loan, Could Receive More* 

By Hugo Miller

Dec. 21 (Bloomberg) -- General Motors Corp. and Chrysler LLC will get C$4 billion ($3.3 billion) in government loans from Canada and the province of Ontario, Canadian Prime Minister Stephen Harper said yesterday, refusing to rule out further aid. 

A day after the U.S. agreed to lend the two automakers $13.4 billion in emergency loans to keep them operating, Canada and Ontario said they will advance General Motors’ Canadian unit C$3 billion while Chrysler will receive C$1 billion. GM had asked for a total of C$2.4 billion in aid from Canada through the second quarter and Chrysler LLC had not disclosed a sum. 

“It’s pretty striking that they’re lending more money than was asked for,” Dmitry Anastakis, a professor of history and Canadian auto policy at Trent University in Peterborough, Ontario, said in an interview yesterday. “This totally conflicts with the rhetoric we’ve heard from Ottawa about the need to protect the interest of the taxpayers.”

----------


## Jet Gorgon

^ Ya, that Cdn deal wasn't to my liking, especially from a Conservative govt. But, as Harper says, many jobs on the line. Yawn. Think it's after a powwow with George W. I'll wait and see what the CAW does before we all start to complain.

^^Wow, finally agree with you, Panda. You are coming around to our smart way of thinking. Get new products, slash costs. Never mind the exec bonuses and jets that will only add to how many million; trash the unions and their legacy costs. The UAW still seems to be the only pouter in the crowd. Hey uneducated workers who are still whining, it's pay cut or job cut. Seems pretty straightforward to me.

----------


## bkkandrew

> ^ Ya, that Cdn deal wasn't to my liking, especially from a Conservative govt. But, as Harper says, many jobs on the line. Yawn. Think it's after a powwow with George W. I'll wait and see what the CAW does before we all start to complain.


Have you had a 'Thank You' card for your tax monies from the auto-makers yet?  :Smile:

----------


## Rattanaburi

It's interesting how Canada coughed up a little to help the automakers after the US. You coudl look at it different wats. I see it as keeping the US from pulling those Canadian jobs back over the border. Canada took away some of the automaker's flex.

----------


## Thormaturge

Presumably Mexico will be coughing up money next.  Maybe the UK could chip in some to keep GM's interest in the UK from being closed down.  

When the stockpile of unsold Chrysler/GM cars equals the number of taxpayers who have paid for them does everyone get a free car?

----------


## Rattanaburi

It would have been a lot easier to pull Canadian work and factories to the US than those in Mexico. It's seems like we are coming to a time where keeping jobs local is more important than the fat cats getting rich while others lose their jobs. I thought I heard they are also starting to pull some of those phone service centers back to the states. With a lot of people losing jobs it will be hard for anyone to justify send jobs overseas. When things get better, it will all start again with companies shipping jobs overseas.

There's a stockpile of Toyotas as well nowadays. I guess people just don't want to buy Toyotas anymore either.

----------


## bkkandrew

Dec. 23 (Bloomberg) -- General Motors Corp. Chief Executive Officer Rick Wagoner said the biggest U.S. automaker got “what we asked for” with $9.4 billion in U.S. loans over the next 24 days. Investors bet that it’s not enough. 

GM tumbled the most in more than a month yesterday in New York trading, while credit-default swaps on the company’s bonds jumped 2 percentage points in a sign of increasing concern that the Bush administration’s bailout may end in a default. 

The stock-price slide all but erased the 23 percent gain on Dec. 19, when Detroit-based GM received a federal aid package to help it stay in business until March 31 while crafting a plan to shut plants, shed brands and reduce debt. 

“It’s almost impossible for a management that invested in the assets, that hired the people, that put forth the strategy, to change so dramatically in such a short period of time,” Edward Altman, a New York University finance professor who created the Z-score formula to measure bankruptcy risk, said in a Bloomberg Television interview. 

There is a “high” likelihood of a GM bankruptcy, Standard & Poor’s said yesterday in reducing the rating on the company’s unsecured debt to C, or 11 grades below investment quality. Robert Schulz, an S&P analyst in New York, said creditors can expect “negligible recovery” should the automaker default. 

GM has slashed output and won union concessions since saying Nov. 7 it may run out of operating cash by year’s end. The automaker said it would need as much as $18 billion in aid or face a possible bankruptcy. 

Aid Timetable 

President George W. Bush promised $4 billion by Dec. 29 and an additional $5.4 billion by Jan. 16, enough for GM to survive at least until President-elect Barack Obama takes office on Jan. 20. Should Congress release more funds from the Troubled Asset Relief Program, GM will receive $4 billion more by Feb. 17. 

Continued here:

Bloomberg.com: Worldwide

This is why this bailout lark won't work. Its called throwing good money after bad. It will bankrupt the USA as I have been saying for a while...

----------


## Norton

*Bailout fever spreads worldwide!!!*

"The German government greeted the US auto loan positively, confirming through its Economy Ministry that talks with GM's German unit Opel would resume early next year. Opel became the first European carmaker to seek a government bailout when in November it asked Berlin to back up loans valued at around 1 billion euros."

GM Europe Welcomes US Car Bailout, Will Still Seek Own Aid | Business | Deutsche Welle | 20.12.2008

"Producers of cars and trucks in Mexico are seeking $3 billion of loans from the nation's government to spur vehicle sales after four months of declines, the president of the Mexican Automobile Industry Association said."

Mexico's auto industry looks for bailout - Business - MiamiHerald.com

Also, Canada has already earmarked bailout money with France, Portugal, Italy, Korea, China likely to follow.  Toyota's announcement it will lose money for the first time in it's history, wonder if Japan step in and catch the fever?  

Jeez the Financial and Auto Industries seem to be sacred cows when it comes to free market capitalism! :Confused:

----------


## sabang

Great, now we're in the era of competitive bailouts.

----------


## blackgang

Letter from Troy Clarke, President of General Motors - followed by a response from Gregory Knox of Knox Machinery: 

Dear Employees & suppliers, 

Next week, Congress and the current Administration will determine whether to provide immediate support to the domestic auto industry to help it through one of the most difficult economic times in our nation's history. Your elected officials must hear from all of us now on why this support is critical to our continuing the progress we began prior to the global financial crisis .......................As an employee or supplier, you have a lot at stake and continue to be one of our most effective and passionate voices. I know GM can count on you to have your voice heard. 

Thank you for your urgent action and ongoing support. 

Troy Clarke President General Motors North America 

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~  ~~~~~~~~~~~~~~~~~

From Gregory Knox, 

In response to your request to call legislators and ask for a bailout for the United States automakers please consider the following, and please also pass this onto Troy Clark, the president of General Motors North America for me. 

You are both infected with the same entitlement mentality that has bred like cancerous germs in UAW halls for the last countless decades, and whose plague is now sweeping the nation, awaiting our new "messiah" to wave his magical wand and make all our problems go away, while at the same time allowing our once great nation to keep "living the dream"… 
The dream is over! 

The dream that we can ignore the consumer for years while management myopically focuses on its personal rewards packages at the same time that our factories have been filled with the worlds most overpaid, arrogant, ignorant and laziest entitlement minded "laborers" without paying the price for these atrocities…and that still the masses will line up to buy our products 

Don't tell me I'm wrong. Don't accuse me of not knowing of what I speak. I have called on Ford, GM, Chrysler, TRW, Delphi, Kelsey Hayes, American Axle and countless other automotive OEM's and Tier ones for 3 decades now throughout the Midwest and what I've seen over the years in these union shops can only be described as disgusting. 

Mr. Clark, the president of General Motors, states: 

There is widespread sentiment in this country, our government and especially in the media that the current crisis is completely the result of bad management. It is not… 

You're right – it's not JUST management…how about the electricians who walk around the plants like lords in feudal times, making people wait on them for countless hours while they drag ass…so they can come in on the weekend and make double and triple time…for a job they easily could have done within their normal 40 hour week. 

How about the line workers who threaten newbies with all kinds of scare tactics…for putting out too many parts on a shift…and for being too productive (mustn't expose the lazy bums who have been getting overpaid for decades for their horrific underproduction, must we?!?) Do you really not know about this stuff?!? 

How about this great sentiment abridged from Mr. Clarke's sad plea: 
over the last few years …we have closed the quality and efficiency gaps with our competitors. 

What the hell has Detroit been doing for the last 40 years?!? 

Did we really JUST wake up to the gaps in quality and efficiency between us and them? 

The K car vs. the Accord? 
The Pinto vs. the Civic?!? 

Do I need to go on? 

We are living through the inevitable outcome of the actions of the United States auto industry for decades. 
Time to pay for your sins, Detroit . 

I attended an economic summit last week where a brilliant economist, Alan Beaulieu surprised the crowd when he said he would not have given the banks a penny of "bailout money". Yes, he said, this would cause short term problems, but despite what people like George Bush and Troy Clark would have us believe, the sun would in fact rise the next day… and something else would happen…where there had been greedy and sloppy banks new efficient ones would pop up…that is how a free market system works…it does work…if we would let it work… 

But for some reason we are now deciding that the rest of the world is right and that capitalism doesn't work – that we need the government to step in and "save us"…save us, hell – we're nationalizing…and unfortunately too many of this once fine nations citizens don't even have a clue that this is what's really happening…but they sure can tell you the stats on their favorite sports teams…yeah – THAT'S important… 

Does it occur to ANYONE that the "competition" has been producing vehicles, EXTREMELY PROFITABLY, for decades now in this country?... 

How can that be??? 

Let's see… 
Fuel efficient… 
Listening to customers… 
Investing in the proper tooling and automation for the long haul… 

Not being too complacent or arrogant to listen to Dr W Edwards Deming 4 decades ago.

Ever increased productivity through quality, lean and six sigma plans… 
Treating vendors like strategic partners, rather than like "the enemy"… 
Efficient front and back offices… 
Non union environment… 

Again, I could go on and on, but I really wouldn't be telling anyone anything they really don't already know in their hearts. 

I have six children, so I am not unfamiliar with the concept of wanting someone to bail you out of a mess that you have gotten yourself into – my children do this on a weekly, if not daily basis, as I did at their age. I do for them what my parents did for me (one of their greatest gifts, by the way) – I make them stand on their own two feet and accept the consequences of their actions and work them through. 

Radical concept, huh… 

Am I there for them in the wings? Of course – but only until such time as they need to be fully on their own as adults. 

I don't want to oversimplify a complex situation, but there certainly are unmistakable parallels here between the proper role of parenting and government. 

Detroit and the United States need to pay for their sins. 

Bad news people – it's coming whether we like it or not 

The newly elected Messiah really doesn't have a magic wand big enough to "make it all go away"  I laughed as I heard Obama "reeling it back in" almost immediately after the vote count was tallied…"we might not do it in a year…or in four…" where was that kind of talk when he was RUNNING for the office 

Stop trying to put off the inevitable … 

That house in Florida really isn't worth $750,000… 

People who jump across a border really don't deserve free health care benefits… 

That job driving that forklift for the big 3 really isn't worth $85,000 a year… 

We really shouldn't allow Wal-Mart to stock their shelves with products acquired from a country that unfairly manipulates their currency and has the most atrocious human rights infractions on the face of the globe… 

That couple whose combined income is less than $50,000 really shouldn't be living in that $485,000 home… 

Let the market correct itself people – it will. Yes it will be painful, but it's gonna be painful either way, and the bright side of my proposal is that on the other side of it is a nation that appreciates what is has…and doesn't live beyond its means…and gets back to basics…and redevelops the work ethic that made it the greatest nation in the history of the world…and probably turns back to God. 

Sorry – don't cut my head off, I'm just the messenger sharing with you the "bad news" 

Gregory J. Knox 
President 
Knox Machinery, Inc. 
Franklin, Ohio 45005

----------


## plorf

^2nd everything except that last christianity part.

----------


## Norton

^^Good one BG.  Out of ammo but one on order.

----------


## blackgang

Thanks Nort, I thought it was damn exact, I have always hated the UAW, bunch of featherbedding bastards.

And I am and always was a Union Stiff. but my unions worked for our keep.

----------


## bkkandrew

Looks like GM will burn their bailout money in a few months, as they are losing $52000.00 per MINUTE!

Thats $2.25BN per month!!!

Just on their own they could burn 10% of the second half of the TARP (if Congress approve it) by the end of 2009!

Money Central - Times Online - WBLG: Ten mind-boggling statistics from the credit crunch

----------


## KID

Apparently Blackgang Has Not Worked In The States For Awhile !!! Try And Survive On $10 An Hour Here For A Year And Come Back And Tell Me What You LEARN IN THAT YEAR   Old Wise One !!!!

----------


## Panda

BBC NEWS | Business | US offers $6bn bail-out for GMAC

*US offers $6bn bail-out for GMAC* 


 GM says that GMAC's falling ability to offer finance has dented sales

*The US Treasury has unveiled a $6bn (4.1bn) rescue package for GMAC - General Motors' troubled car loan arm, co-owned by Chrysler's owner, Cerberus.*


The government thinks the problem is that people are not borrowing enough.
The silly peasants are tightening their belts and trying to put some money away for the hard times ahead while they still have a job.

----------


## Dacrondude

I still live in the USofA and I am well aware of the negative impact that NOT saving the US auto giants will have on this economy and I say let them sink. I do NOT want my tax dollars used to save companys that can't save thenselves. Lets just put the bail out money in the unemployment fund and pay the out of work auto workers benifits, or let the goverment buy/bail out the big 3 so if the day comes that we can build a car thats worth a sh.t the PROFITS will be returned to the American people. I work for a small start up in the Solar industrie and NO ONE is going to just hand us money if we get into trouble. If we get money from someone they expect and should get a return on investment, are the big 3 (Ford, Chrysler and GM) going to share the profits in the future with the American people if we help them now?, *NOT!!!* . The big 3 have been ignoring consumer buying trends since the early 60's THIS is what happens when you say f..k the consumer we will make what we want and DESIGN it to fail at 100,000 miles if not sooner. Now it has been decided that GMAC the lending arm of GM is to be treated like a bank and not part of the auto giant so GMAC is now feeding at the trough like a bank so GM is half way there. My country gives 117 million to a financial institution to bail them out and the first check they write is to the CEO 54 million for his year end bonus*. WHAT THE F..K IS THAT ALL ABOUT!!!!!!!!!*

----------


## panama hat

^ Well said, straight from the horse's mouth

----------


## Panda

> Now it has been decided that GMAC the lending arm of GM is to be treated like a bank and not part of the auto giant so GMAC is now feeding at the trough like a bank so GM is half way there. My country gives 117 million to a financial institution to bail them out and the first check they write is to the CEO 54 million for his year end bonus*. WHAT THE F..K IS THAT ALL ABOUT!!!!!!!!!*


Not so unlike the Thai style of political / financial management.
--- Give to to the rich and some of it is bound to flow down to the poor sooner or later. Those poor people are just too stupid to be allowed to decide how the fruits of their labour are spent.

----------


## watterinja

In this case the poor have elected a government that has fewer brains, or intellect than they do. The US is going to be in a mess for a long, long time thanks to Gorgeous Butch & his mates...

----------


## Panda

> In this case the poor have elected a government that has fewer brains, or intellect than they do. The US is going to be in a mess for a long, long time thanks to Gorgeous Butch & his mates...


I dunno who's the most stupid. They elected a dyslexic imbecile twice!
A bit scarry when these morons control the most powerful military apparatus ever to be assembled on the face of the planet. Credit to them that they eventually woke up though.

The Yank voters do love their wars though, -- provided it doesn't come any closer then their TV screens. A bit of a parallel with the old Romans there in an historic sort of way.

----------


## Rattanaburi

*General Motors cleans out the garage* 

*Troubled automaker is selling vehicles from its 'Heritage Collection'*

GM cleans out the garage - Autos- msnbc.com


General Motors is cleaning out the attic to sell some stuff at the auction house to raise some much needed cash. 


Around 250 vehicles from GM's "Heritage Collection" will be auctioned by Barrett-Jackson, with the first lots going on Jan. 13 in Scottsdale, Ariz., and the second hitting the block in April in West Palm Beach, Fla. 

Don't think that GM is parting with the family jewels to pay the mortgage. Though insiders can't recall such a big chunk of the collection being sold at once, 25 percent of the total, most of the vehicles are special show cars and one-offs that GM snapped together for the Specialty Equipment Manufacturers Assn. shows over the years, as well as some classic production cars that were duplicates of models GM still has. 

Of interest to some bargain-hunting curiosity seekers, too, are some examples of GM design failures. As one GM executive told me off the record, "These are mostly cars that current management [probably product boss Bob Lutz and design chief Ed Welburn] don't much care for." 

The real family jewels aren't going anywhere, even if one, like the first off-the-line 1966 Oldsmobile Toronado or 1938 Buick Y-Job, might bring as much cash as 10 or 20 of the cars being sold off. 
GM Heritage Collection spokesman Greg Wallace says it's more a "thinning of the warehouse." He says it costs the company roughly $2,000 a year per car to maintain, store and transport each vehicle. And with GM designs getting better and better under Lutz and Welburn, the company wants to make room for some of the new family gems, like the 2008 Chevy Mailbu and 2010 Chevy Camaro.

----------


## Thormaturge

I bet there is a memo going around their office staff advising the last person to leave the building every night to switch off the lights.  I expect personal use photocopying has been stopped and the Chairman is now using a cheaper brand of coffee creamer.

----------


## Norton

^Exactly.  They've had years to change their ways and field a competitive product.  No reason to believe they will miraculously come up with a "new" plan in a couple of months.  

All we will see is a rearrangement of the deck chairs as the ship slowly sinks.

----------


## bkkandrew

They can't even afford bogroll in their schools now:

DETROIT -- A Detroit elementary school is asking for donations of toilet paper and light bulbs to continue functioning. The
principal of the Academy of Americas sent a letter to staff, parents and partners asking for donations of items "that are
of the utmost importance for proper school functioning and most importantly for student health and safety."

In the letter, Principal Naomi Khalil cited budget constraints within the district as the reason that the school could no
longer stock the items. The district is grappling with a more than $400 million budget deficit and is on the verge of being
assigned an emergency financial manager by the state.

The letter asks for toilet paper, paper towel rolls, trash bags and 60-, 100- or 150-watt light bulbs.

"We realize that the economic situation is stressful for our entire community, but we are asking for your collaboration,"
wrote Khalil. "We thank you for your cooperation and we hope that as a school community we can pull together to
guarantee the best possible educational environment for our children."

Parents said a letter went out asking for supplies at the start of the school year. "They sent out a letter for pencils, pens,
they put Kleenex on there," said parent Danny Huddleston.

A spokeswoman for the district said the school is not running out of supplies but instead is asking for them to ensure
they have sufficient supplies to what they already have.

But at least one parent said he doesn't mind helping out the school no matter the circumstance. "I'm all about helping
the school. If that's what they need, then that's what we need to see what we can do to help them out," said Juan
Oroczo.

Donations are being accepted at the school's front office, beginning Jan. 12.

The school is located at 5680 Konkel St. in Detroit.

Detroit School Lacks Toilet Paper, Light Bulbs - Detroit Local News Story - WDIV Detroit

Imagine what it will be like _after_ the big 3 go bust...

----------


## watterinja

> The district is grappling with a more than $400 million budget deficit and is on the verge of being assigned an emergency financial manager by the state.


The budget officer should be fired pronto.

Credit & excess has been a drug to these people. Weaning back to normal adult life is going be cold turkey for most.

----------


## tuktukdriver

> Originally Posted by Smeg
> 
> 1 in 10 jobs in the US rely on it.
> 
> 
> Another nonsense "statistic" used by supporters of the bailout. There may be this many jobs involved in the auto industry but implying they would all be out of work if the big three goes bust is bollocks.
> 
> Chevrolet dealers will become Honda or Toyota dealers, parts suppliers will supply parts to other auto manufacturers who build in the US. 
> 
> ...


I agree. That "1 in 10" number is ridiculous. There are so many of those jobs that won't be affected much. That number includes gas stations, parts shops, ect. Even the parts suppliers won't all go under. Many of the suppliers to the big three also supply parts to the aviation industry as well.

That said, wasn't it Harley-Davidson that was bailed out by Reagan in the 80's? They weren't nearly as popular as they are today and quality was a big issue. They have done really well since then.

----------


## tuktukdriver

[quote=bkkandrew;910797]They can't even afford bogroll in their schools now:

DETROIT -- A Detroit elementary school is asking for donations of toilet paper and light bulbs to continue functioning. The
principal of the Academy of Americas sent a letter to staff, parents and partners asking for donations of items "that are
of the utmost importance for proper school functioning and most importantly for student health and safety."

In the letter, Principal Naomi Khalil cited budget constraints within the district as the reason that the school could no
longer stock the items. The district is grappling with a more than $400 million budget deficit and is on the verge of being
assigned an emergency financial manager by the state.



Schools are usually paid for by property taxes. The Detroit real estate market is the worst in the nation. That could explain the shortfall. Meanwhile the high school football field down the street from my house is now installing a giant big screen TV/scoreboard, something like you see in the pro ranks. We surely aren't hurting here in the land of Microsoft.

----------


## Johnny Longprong

There may not be a "bailout". The only bailout might be the rats deserting the sinking ship.

It just had to happen. You can't keep producing obsolete products and expect the world to be excited about them.

----------


## Rattanaburi

Something about the way America is going. Just an opinion I found on MotleyFool. 

TMF: No Free Lunch--Borrowed time / Macro Economic Trends and Risks




> As I have gone through life I have always been thankful that I didn't get in trouble for every little stupid or risky thing I did. I always sort of felt I was getting away with something. Now trust me here, I had a Dad who somehow knew just about every time something was amiss at home, "Who did it?", "Why they did it?" and he absolutely knew what he was going to do about it.
> 
> Still I remember driving 110 mph as a 12 grader in our V-8 Chrysler Newport and not killing myself or my friends. Swinging on makeshift ropes across 50-60 feet deep gorges playing Tarzan and living to tell about it. Skydiving and having the primary chute fail, only to have the reserve work like a charm. I must admit even though I have felt the wrath of Dad and paid many a price for plenty of misadventure, I have felt like I had a sort of guardian angel with me plenty of times. In other words I am thankful that "What goes around, hasn't always come around". I bet most of us have felt this way at one time or another. I really mean that in the best of ways. Problem is I just do not think it will work that way for our Country's economy or even the World's economy for that matter.
> 
> This Board has been a wonderful view into the Big Picture events of the last 50 years. I am not the Historian many here are and do not pretend to understand all the workings of past administrations or the legislation produced. The Building of a Social Security Network. The structuring of the Tax Revenue Codes. The Building of the infrastructure and Public Works Systems including Fire, Police and EMS services. We have built quite a country while I was out sewing oats, acting the fool and taking all those things for granted. Didn't we all growing up? 
> 
> We seem to be standing either "On the Brink" or "At the crossroads".
> 
> It more than likely is not quite what I think it is, but this time in our country's history seems to be more important than what took place back in the 1930's. We seem to be faced with issues that go deeper into the very ability of our country to function. Is that hyperbole? The inner workings of what we have, what we produce, and what we consume reaches much further around the globe than it ever has. That is no earth shattering revelation I know. Problem is, most of the folks making decisions seem to be ignoring the long (heck even short)term consequences. When looking at how we are dealing with our Fiscal Situation as it stands today only a few truly out of touch folks would not call this a once in a lifetime Crisis. Problem is the ones making the decisions about how this affects us in 30 years more than likely will be dead. Yep, sounds sorta sicko, but they will. Maybe not all, but plenty of them will be and I see those groups begging, coercing and doing what ever it takes to keep the status quo for as long as possible.
> ...

----------


## Texpat

Well the Poms and Frogs followed suit.

This thread was much more interesting to read second time around.

Do they never learn?  :rofl:  I don't guess we'll be hearing much after this ...  :Roll Eyes (Sarcastic): 

*British automakers to get £2.3 billion in aid*

"Britain on Tuesday joined governments around the world in announcing an aid package for its ailing auto industry. The £2.3 billion plan came after three months of pleas from trade unions and executives at Jaguar Land Rover and Vauxhall.  

Britain offered auto manufacturers and suppliers access to £1.3 billion, or $1.8 billion, in loan guarantees from the European Investment Bank, topped up with another £1 billion from the Treasury, the business secretary, Peter Mandelson, told Parliament on Tuesday. He also said that the government would increase its funding for retraining workers who had lost their jobs.

  The automotive industry "is in the front line of the downturn, with output falling faster and further than any other sector since the summer," Mandelson said. "We need to counter this to prevent an irreversible loss of capacity, skills and technology."

  But he added that the "industry is not a lame duck and this is no bailout."
  "There is no blank check on offer, no operating subsidies," he said.

The opposition Conservative Party criticized the measures as "too little, too late" and accused the government of dithering while other countries moved swiftly to support their automakers. The United States, France and Germany have all announced plans to support their automakers.

  The British auto industry adds about £10 billion a year to the economy and employs more than 800,000 people. But government aid to automakers is more controversial in Britain than in other countries because most of the British manufacturers are foreign-owned. For example, Jaguar Land Rover, which employs 15,000 people in Britain, is owned by Tata Motors of India. General Motors of the United States owns Vauxhall.

  Pressure to come up with a plan to support the industry, which exports about 76 percent of its production, grew when production almost halved in December, manufacturers halted production at some plants and the industry's difficulties started to affect other sectors of the economy. Corus, one of the largest European steel makers, said Monday that it would cut 2,500 jobs in Britain after demand from automakers and the construction industry fell dramatically.

  The British government is already worried about unemployment, which rose for an 11th consecutive month in December, when it reached 1.16 million, the highest since January 2000. The deepening recession is also harming the popularity of Prime Minister Gordon Brown as consumers grow more concerned about the government's ability to cope with the recession.

  Howard Wheeldon, a senior strategist at BGC Partners in London, said he doubted that the aid package would be enough to rescue the industry in the long term, but that "it should see those that take it up through the rest of this year."

  Mandelson said the support was also intended to help make the British economy "more balanced," as the recession revealed that the country had relied too heavily on the financial services industry, leaving it too exposed to the credit crisis.

*"The U.K. needs an economy with less financial engineering and more real engineering," Mandelson said.
*
  The support should also make the auto industry "greener, more innovative and more productive," Mandelson said. He did not say whether the aid was linked to specific conditions.

  Mandelson planned to meet executives from Vauxhall and Jaguar Land Rover on Wednesday to discuss the aid package."

British automakers to get £2.3 billion in aid - International Herald Tribune

***

 :Smile:

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## Panda

> the recession revealed that the country had relied too heavily on the financial services industry, leaving it too exposed to the credit crisis.
> 
> *"The U.K. needs an economy with less financial engineering and more real engineering," Mandelson said.*


The penny drops.

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## Texpat

Ummmm, pssst .... that's the _pound_.

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## plorf

This whole bailout thing seems so shortsighted that it's ridiculous. If people buy fewer cars then companies have to downsize, if the workers have no work and  salaries are paid by government bailouts, you could just as well pay them unemployment money and then try to get a new job until in a couple of years manufacturers start hiring again...

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## Texpat

Why would an upstanding, smart, efficient and classy operation like the UK auto industry -- that makes brilliant and lovely machines -- need a bailout?

Their cars corner cleverly, seat one comfortably and have nice stickers on them... 

I'm confused.  :Roll Eyes (Sarcastic):

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## baldrick

> "The U.K. needs an economy with less financial engineering and more real engineering," Mandelson said.


the world needs an economy with less financial engineering and more real engineering

send more suited paper shufflers to the frontline as more sandbags are needed

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## watterinja

Ban all suits...

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## Panda

> This whole bailout thing seems so shortsighted that it's ridiculous. If people buy fewer cars then companies have to downsize, if the workers have no work and salaries are paid by government bailouts, you could just as well pay them unemployment money and then try to get a new job until in a couple of years manufacturers start hiring again...


The thing is that a lot of big companies thought the boom years were going to go on for ever, and so they borrowed so much money to keep expanding or to produce uncompetitive products that they needed loans to pay their workers next months wages. When the market slumped they went broke very quickly. But the governments want them to keep building cars nobody wants to buy in order to prevent massive unemployment. So what you end up with is a lot of new cars nobody can afford parked in storage lots. A bit like the US houses the banks own that nobody wants anymore. 

The governments are borrowing money and giving it to the bankrupt banks in the hope they will loan it to people to buy houses and cars nobody wants. 

Its a modern day version of the "Cargo Cult" of the Eastern Pacific Island natives during WW2.  Basically a belief that wealth and material goods will appear out of nothing if you just believe. Well, it actually worked for a while, but now we got to pay back the debt. Or at least our kids and grand kids will have to pay it back.
Cargo cult - Wikipedia, the free encyclopedia

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## plorf

^ I am aware of that, but even back in the days when I was in high school I've been taught about the fragility of the american system, it's huge trade deficit, whole economy based on loans etc, it didn't sound good to me back then, still doesn't. That might be because we're pretty much the complete opposite in Switzerland, constant trade surplus, huge saving rates, little consumption on loans or general domestic consumption and few domestic investment opportunities. Has it's drawbacks too, as we rely on exports and foreign investment opportunities, and thus the wealth of neighbouring countires but it's generally pretty solid unless some banks get too greedy in the US...

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## Spin

Oh dear.....

*GM Posts $9.6 Billion 4th-Quarter Loss as Wagoner Seeks New Aid*

Feb. 26 (Bloomberg) -- General Motors Corp., surviving on $13.4 billion in U.S. aid, reported a $9.6 billion fourth- quarter loss as Chief Executive Officer Rick Wagoner prepared to ask the Treasury for more cash to get through the year. 

The deficit was $15.71 a share, wider than the year-earlier net loss of $1.5 billion, or $2.70, the biggest U.S. automaker said today in a statement. GM posted an annual loss of $30.9 billion, the second largest in its 100-year history. 

“The size of the loss matters not only because it impacts what it will cost to restructure the company, but also the kind of bill for which the taxpayer is on the hook,” said John Casesa, a managing partner at consultant Casesa Shapiro Group in New York. “Conditions in this quarter could not have been worse.” 

GM’s future may pivot on whether Wagoner, 56, is able to persuade President Barack Obama’s auto task force to approve as much as $16.6 billion in additional money to keep the Detroit- based automaker operating. He is scheduled to meet with the panel today in Washington, people familiar with the talks said. 

GM said Feb. 17 it needs at least $2 billion more in loans next month or it will run out of cash. Should the task force opt to withhold further aid, GM’s only option may be a government- backed bankruptcy. 

Fourth-quarter sales plunged 52 percent to $30.8 billion, GM said. Excluding some expenses, the operating loss was $9.65 a share, more than the $7.46 average estimate of 9 analysts surveyed by Bloomberg. GM last posted an annual profit in 2004. 

Loss in 2007 

GM lost $38.7 billion in 2007, including a $38.3 billion third-quarter charge for tax accounting because of ongoing losses. 

A collapse in domestic sales and waning demand in overseas markets forced GM to announce plans for 47,000 job cuts in 2009, five more U.S. plant closings by 2012 and the sale or shutdown of the Saab, Hummer and Saturn brands. GM is also paring pay for many salaried workers and seeking debt and labor concessions. 

Wagoner’s discussions with representatives of the autos task force are supposed to include Chief Financial Officer Ray Young and Chief Operating Officer Fritz Henderson, people familiar with the plans have said. Chrysler LLC CEO Robert Nardelli, Vice Chairman Tom LaSorda and CFO Ron Kolka met with the team yesterday, people familiar with those talks said. 

Task Force Clout 

The 10-member task force, led by Treasury Secretary Timothy Geithner and National Economic Council Director Lawrence Summers, has the power to force a bankruptcy filing or make other changes to the automakers’ viability plans. 

GM and Chrysler submitted progress updates Feb. 17 to the U.S. Treasury to determine whether they can keep the current loans, qualify for more money and avoid bankruptcy. A final report is due March 31. 

Under GM’s plan, unsecured bondholders with $27.5 billion in debt are being asked to accept about $9.2 billion in debt and the rest in equity. 

GM wants the United Auto Workers to accept half of a $20.4 billion payment due next year for the union-run retiree health care fund in cash, as a condition for the automaker to keep the first installment of its U.S. loans. 

Ford Motor Co., which isn’t seeking U.S. aid, won a similar accord with the UAW this week. 

Chopping Debt 

GM said on Dec. 2 it needed to whittle $62 billion in debt and other commitments to about $33.5 billion, excluding the government loans. 

Chopping expenses and debt should be enough to help the automaker begin repaying its federal loans in 2012, according to GM’s viability plan. 

Even with agreements from the union and bondholders, debt and similar obligations at GM may reach $73.7 billion next year, including the first $13.4 billion in borrowings from the U.S. Treasury, according to a Feb. 19 note from Rod Lache, a Deutsche Bank AG analyst in New York. 

GM rose 33 cents, or 15 percent, to $2.55 yesterday in New York Stock Exchange composite trading for a second straight advance. The shares have fallen 90 percent in the past 12 months.

source

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## Norton

> GM said Feb. 17 it needs at least $2 billion more in loans next month or it will run out of cash. Should the task force *opt to withhold further aid*, GM’s only option may be a government- backed bankruptcy.


The minute GM was given the first "loan" the hook was set.  Opting "to withhold further aid" now is really not an option.  Should GM go bankrupt all or the lions share of the cash already given them will be at risk.  

Suspect they will get more.  And next time more again.  A slippery slope the gov has gotten themselves into.

Pull the plug now!  Take the loss and let GM file for bankruptcy.  Given the sales success they had in the fourth quarter, the argument no one will buy a car from a company in bankruptcy will sound rather ridiculous.

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## Spin

^ You state the cold hard facts. The government could have saved money by paying every single gm employee to retire or start thier own small businesses or whatever.
Thailand has car factories for good reason. workers are 5$ a day. Western countries cannot compete, unless they have premium product like BMW or Benz.

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## Muadib

How long do you throw good money at a failing enterprise... BO talks about 'restructuring' the US auto industry to be more progressive... That would take years and 10's of billions of $$$... We can't afford it...

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## HermantheGerman

*I don't believe that this is the ultimate answer, but better then giving every citizen money to buy drugs and booze...like in the U.S.
*





*New-for-old bonus kickstarts Volkswagen sales in Germany*



German car manufacturers are celebrating a record boost in domestic sales that has been put down to the introduction of a government bonus given to consumers who trade in their old vehicles for new ones.
The country's biggest car manufacturer, Volkswagen, said yesterday its sales in Germany for February already stood at over 120,000 - higher than they have ever been in the company's history.
Car-maker Opel said that domestic sales of its small model, the Corsa, had rocketed to 40,000. "This is our best month for five years," said Opel's sales manager Thomas Owsianski. The company said that it had introduced extra shifts at its Eisenach plant in order to cope with demand, which had risen to three times the normal level.
The growth in sales has been directly attributed to a government "Abwrackprämie", or "Old-banger Premium" introduced last month in a bid to boost the ailing car industry, on which one-in-seven German jobs is dependent.
Under the scheme, which is set to cost the government €1.5bn (£1.33bn), those who trade in a car that is over nine years old receive €2,500 (£2,230) towards a new model.
The hugely popular response to the bonus in Germany has caused waiting lists for cars - particularly small models like Polos, Golfs and Corsas - to stretch to months. Politicians are now coming under pressure to extend the bonus to social welfare recipients.
Governments in Spain and France have also adopted similar schemes. Shifts at Opel's plant in the Spanish city of Zaragoza, which produces the Corsa, have also been extended to cope with demand.
But while the increased sales activity has been welcomed by the car industry, observers warn it is little more than a short-term spike, and will do little to reverse the overall gloomy picture. German manufacturers are overwhelmingly dependent on export sales, which have plummeted over recent months - particularly to America.
Yesterday 16,000 Opel workers, around 64% of its total workforce in Germany, took to the streets in several German cities to demand job guarantees. Thousands more demonstrated in other European countries, including Britain, following the announcement by its US parent of 80 years, General Motors, that it planned to axe thousands of jobs in Europe under a restructuring plan to save it from bankruptcy.
Chancellor Angela Merkel told a press conference of foreign journalists that the government would "leave Opel and GM to come up with a sustainable plan for the future" before making any decisions on whether Opel would be given any state support.
Yesterday, new figures showed Germany's jobless total had risen to 3.5 million or 8.5%, and was set to rise further over the coming months.


New-for-old bonus kickstarts Volkswagen sales in Germany | Business | guardian.co.uk

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## panama hat

^ Yup, a good idea . . .Didn't Opel have a near record sales month in January?  If GM decides to cripple Opel because of it sown inadequacy then they are cutting off their nose to spite their face

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## watterinja

The Europeans are cunning. Good to see that it has paid off for them.

Socialism vs capitalism.

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## panama hat

^ I'm not sure if it can be described as being cunning . . . more like having a long-term vision as opposed to making the quick buck.  

The advantage/disadvantage the US has in this regard is the huge landmass  combined with a relatively low population density that allows for grand-scale thinking, with its pitfalls as well as its possibilities. 

Australia has a combination of the two . . . sadly we have taken mostly the negatives from both

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## Norton

> Didn't Opel have a near record sales month in January?


Possibly but if so then how did they, GM Europe, manage to lose $2.8 billion as reported by GM yesterday?  

Every major auto manufacturer is losing money and are all trying to cut losses with plant shutdowns and/or production cutbacks.  

Bailing out Opel is being strongly considered by the German government as the only way to save the company.  The hurdle for the moment is ensuring German taxpayers none of the money will go to GM Corp in the US.  We will find Opel suffers the same problems faced with automakers in the US.  That is, lagging sales coupled with inefficient structuring and non competitive labor costs.

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## panama hat

> Possibly but if so then how did they, GM Europe, manage to lose $2.8 billion as reported by GM yesterday?


Not sure . . . I was watching the economic report on Deutsche Welle last night.  I do know that Opel has been losing money hand-over-fist . . . maybe the incentive to buy new cars is having an effect




> non competitive labor costs.


That will be the case for all bar a few countries  . . . even places like Malaysia and Indonesia are victims of lower wages in other countries

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## Norton

> maybe the incentive to buy new cars is having an effect


Think so.   A 2,500-euro rebate from the gov will do it for sure.

"The carmaker said on Feb. 23 that the government program, which offers a 2,500-euro rebate on trade-ins of cars older than nine years, led to sales exceeding 40,000 vehicles in February, its best month in five years."




> I do know that Opel has been losing money hand-over-fist


"GM reported a worldwide loss yesterday of $30.9 billion for 2008, including *$2.8 billion from its European divisions*."     

Bloomberg.com: Worldwide

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## panama hat

> a 2,500-euro rebate on trade-ins of cars older than nine years


Killing two birds with one stone there . . . getting rid of inefficient old cars and spurring sales of the new with many benefits . . . provided these people don't lose their jobs. 

Oddly enough it states here:



> Insgesamt habe General Motors  (News/Aktienkurs) (GM) in Europa mit einem "ordentlichen" Gewinn abgeschlossen, berichtet die Zeitschrift. 80% des GM-Geschäfts in Europa stammen von Opel. Profitable Märkte des Rüsselsheimer Automobilhersteller seien in Europa unter anderem Großbritannien, Spanien und Italien.


 . . . that Opel ended the year in the black with the UK, Spain, Italy ond others, were profitable. 

Here it states:



> RÜSSELSHEIM (Dow Jones)--Die GM-Tochter Opel schreibt in Deutschland offenbar Verluste. "Der deutsche Markt sei nicht mehr profitabel", sagte Hans H. Demant


That the German market isn't profitable for OPEL


Economics  and statistics . . .

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## Norton

> Economics and statistics . . .


Not sure if "Opel" per se is losing money.  As you point out depends on what is counted.  I do know there is a significant management overhead that gets rolled into the GM Europe financial's so could be this is a big contributor to GM Europe losses.

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## panama hat

^ Precisely what the article also mentioned . . . US costs/losses are slipped into the GM Europe p/l.

Also:




> In Germany, many say that a split from its Detroit parent is the only thing that can save the car maker. And, as became clear on Thursday, Opel workers are furious with GM for the predicament they currently find themselves in. "They built up overcapacity around the world without regard for losses," Berthold Huber, head of the union IG Metall, told protesters at Russelsheim. "*And they have built models with the aerodynamics of a barn door and the weight of a small tank." He said that, given high fuel costs and growing unemployment, such cars are "as necessary as freezers at the North Pole."*



 :Smile:

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## barbaro

This article doesn't really say what exactly is going to happen.  The restructuring plan is 2 weeks away.  At this time, there is no final verdict on GM? 




> *General Motors Checkmates Obama In Two Moves*
> 
>                                          By 24/7 Wall St. Wednesday, Mar. 18, 2009
> 
> 
>                                                                                           MARK RALSTON / AFP / Getty
> 
> 
> 
> ...


Link & Entire: General Motors Checkmates Obama In Two Moves - TIME

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