Thread: Bailing Out the US Auto Industry....

Looks as if the new boy on the block is hell bent on subsidizing bad business practices. This is becoming a common trend throughout the world. And such backward thinking will always be in fashion. The people suffer.....

This sucks. As does the AIG bail-out -- apparently, the co just spent another $300k (quietly) for its exec pow wow in Phoenix. Wait for the other industries to jump on the band wagon. Airlines come immediately to mind.

Originally Posted by Rural Surin

Well, if were just talking about America. Add the stock market bail-out, the countinuous subsidizing of corps in general, airlines, military contractors, insurance and creditor bail-outs, banks, incredible agricultural subsidies....the list is never ending. This is not just a American phenomena {even though they are the best at it}, this is universally accepted and understood - GOVT MAINTENENCE OF PRIVATE BUSINESS. Govt should not be in business. I know this sounds extremely idealistic. The "market" is enguled by illusion. There isn't any wealth......

Not the stock market, the banks. I don't understand your thoughts on govt maintenance in the US, before this debacle. I see alot of policies made by almost every govt to protect their local industries.

America doesn't have "local" industry. Service and consumption.

Originally Posted by Jet Gorgon

Originally Posted by Rural Surin

Well, if were just talking about America. Add the stock market bail-out, the countinuous subsidizing of corps in general, airlines, military contractors, insurance and creditor bail-outs, banks, incredible agricultural subsidies....the list is never ending. This is not just a American phenomena {even though they are the best at it}, this is universally accepted and understood - GOVT MAINTENENCE OF PRIVATE BUSINESS. Govt should not be in business. I know this sounds extremely idealistic. The "market" is enguled by illusion. There isn't any wealth......

Not the stock market, the banks. I don't understand your thoughts on govt maintenance in the US, before this debacle. I see alot of policies made by almost every govt to protect their local industries.

What don't you understand about government overlording and suppression of business? The government is in every aspect of your "free" existence....

Interesting how the tub thumping rightist Bush administration has in reality proved to be Socialist.

Originally Posted by Rural Surin

America doesn't have "local" industry. Service and consumption.

Huh? I meant local as in domestic industries. Do you consider the auto, steel, aerospace, defense mfg sectors among others as service sectors? Methinks not. They are also strongholds of the stranglehold unions.

Join a non-union shop then.

The UAW finally agreed to lower starting wages last year. But check this out: auto union workers were making more than $78 an hour PLUS benefits. C'mon. That is ludicrous. $78 an hour just for a newbie to assemble a fekin car nobody wants to buy?

``I've got a saw-mill worker in my district who's making $15 an hour,'' Representative Spencer Bachus, an Alabama Republican, said during a House committee hearing today, according to a transcript. ``And we're taking his money, and we're paying it to a company that's paying $75 an hour.''
The criticism comes a year after the union agreed to lower pay and end pensions for new hires at GM, Ford and Chrysler. (What about the other guys?)
Under the contracts, hourly pay and benefits for new hires were cut to about $26 from about $78. The 2007 accords also call for creating a union-managed trust that will take over responsibility for retiree health care obligations starting in 2010.
...The union's lobbyist in Washington, said the labor costs ``aren't out of line'' with those in U.S. factories owned by Asian and European automakers.
``We're not the problem,'' Reuther said. (BS)
`Gold-Plated Benefits'
GM said last week it may run out of money by the end of the year and won't have enough by mid-2009. (Chapter 11 is the way to go, IMO; I think it can dump the UAW then)
House Speaker Nancy Pelosi said the aid she envisions for automakers would come with conditions, including restrictions on executive compensation, ``a prohibition on golden parachutes'' and ``rigorous independent oversight.'' (Ya, and what about cutbacks on UNION wages, Nancy?)
The automakers want $25 billion in new government loans to address liquidity issues, including operating costs, plant investments and research costs, GM's chief lobbyist, said in a Nov. 10 letter to Congress. Separately, the UAW wants $25 billion to cover the costs of the union-run retiree health care funds. (WTF?)
The UAW is being criticized ``because they were successful,'' ...``They really did have gold-plated benefits. A lot of workers didn't come close to that.'' (Yep.)
One example, he said, was the ``jobs banks'' that enabled UAW members to receive 95 percent of their take-home pay while laid off. The 2007 contracts put new limits on the jobs banks.
Union officials say they have already sacrificed to try to benefit the automakers.
``We have been in a concessionary mode for some time and we're still in it, like it or not, because of the economics of the globe,'' UAW's Green said. ``We want to see America's auto industry survive for America, not just for us.''
The union's membership has shrunk as GM, Ford and Chrysler cut back on production jobs, falling 14 percent last year to 464,901, or less than a third of its 1979 peak of 1.5 million.
The union has had trouble winning over the public, Clark University's Chaison said.
``To some degree, 10 to 20 years ago, auto workers were idolized as the aristocrats of labor,'' he said. ``Now they're viewed as spoiled. They won the battle but lost the war.'' And good riddance to them.

Bloomberg.com: Worldwide

^ Agree, SirB. Unless the dinosaurs reinvent themselves, shed the union burden and streamline, they will be dust. I am interested if the big three file for Chapter 11, if they can get rid of the unions. Will research United Airlines for that. The UAW is strong tho, and I wouldn't doubt that they are helping to drive Pelosi into doing the bailout.

Originally Posted by Jet Gorgon

This sucks. As does the AIG bail-out -- apparently, the co just spent another $300k (quietly) for its exec pow wow in Phoenix. Wait for the other industries to jump on the band wagon. Airlines come immediately to mind.

Quite aside from parcels of hard currency under the table, condition the people into accepting you and your practices, and when it goes wrong you can ask to be bailed out in order to continue serving the people so the gov can get more taxes. Laughable, but it works.

Originally Posted by Sir Burr

The US car industry is hobbled by an expensive unionised labourforce and huge financial commitments to retirees pensions and health care.

The likes of Toyota, Honda & Benz also have a unionised workforce, and massive pension schemes. Toyota and Honda manufacture quite succesfully in the US too. The buck stops with poor management, I reckon.

Let the yank tanks sink,

It's much like paying college tuition.

The guy who scrimps and saves for his kid's education, eating soup and sandwiches and foregoing the weeklong fishing trips, is rewarded with proportionately higher pricetag than the schmuck who proudly exhibits his empty savings accounts and quietly conceals his BMW and vacation house in Tahoe.

It's just wrong.

The Us car industry has always produced inefficient, poorly designed and badly built cars, its a management problem that they have never got to grips with.
Nothing wrong with US manufactures in general but the Auto industry has for the last 30 yrs lagged behind the rest of the world and now its so far behind they are being lapped.
Its way too late to play catch up now, the Government should see it for what it is, a sunset industry thats best left to others to handle.
Any money that goes into it now is just being pissed up against the wall.

^ Not only mgmt, Norts. The unions sucked them for alot, too.

Slightly off-topic but just watched Top Gear and they were quite impressed with the new range of muscle cars from the Big 3 US manufacturers.

So how ironic is that; they're all in financial strife and they finally manage to start making cars that could be appreciated by the European market.

Didn't we do this thread three months ago?

At $59 a bbl, ain't no way Yanks en mass will drive that shitty Euro crap you call cars.

Originally Posted by Texpat

Didn't we do this thread three months ago?

At $59 a bbl, ain't no way Yanks en mass will drive that shitty Euro crap you call cars.

Really? They're quite partial to Japanese cars though aren't they; part of the reason US manufacturers are struggling.

Originally Posted by Jet Gorgon

The unions sucked them for alot, too.

Yep but I only get sucked when I allow it.

Originally Posted by Jet Gorgon

^ Not only mgmt, Norts. The unions sucked them for alot, too.

Its all a management problem, the unions only got away with whatever weak management let them.