$15 Billion auto bailout coming

[TJ]

I think it's funny that if a small business goes under people say "well, they should have managed the company better."

But, if a big business if about to go under people say "OMG, this can't happen, we need to save them! Uh, how about we give them billions of dollars that the tax payers can pay for? Okay, sounds good."

 

[Duality]

I think it's funny that if a small business goes under people say "well, they should have managed the company better."

But, if a big business if about to go under people say "OMG, this can't happen, we need to save them! Uh, how about we give them billions of dollars that the tax payers can pay for? Okay, sounds good."

just a tad overly simplified but ok. the logic the CEO's of these companies are using against congress is that if they do fail, it well send the economy into absolute turmoil with layoffs near/around the millions and the subsequent backlash that will have. this may be true, but the ship would eventually right itself. ryeland summed it up very well.

 

[high_five]

Hopefully, the Senate will reject the bill.

 

[Ironslave]

Hopefully, the Senate will reject the bill.

they won't.

 

[Tech]

they won't.

they just did. lulz.

The Senate rejected the bailout 52-35 on a procedural vote -- well short of the 60 required -- after the talks fell apart.

http://biz.yahoo.com/ap/081211/congress_autos.html

 

[Duality]

though this is the right decision for the country, i'm afraid of what this will do to unemployment and the economy right now. the me living right now is very leery of what will happen, but thinking ahead it is a sound decision.



after just reading it, this says it all,

The group came close to agreement, but it stalled over the UAW's refusal to agree to wage cuts before their current contract expires in 2011. Republicans, in turn, balked at giving the automakers federal aid.

FUCK YOU AUTO UNIONS. INSTEAD OF TAKING WAGE CUTS LIKE YOU SHOULD, HAVE FUN BEING UNEMPLOYED INSTEAD.

 

[Ironslave]

ha, awesome. Glad I was wrong. The unions really fucked themselves over now. Instead of a low paying job they won't have one.

 

[Braaq]

FUCK YOU AUTO UNIONS. INSTEAD OF TAKING WAGE CUTS LIKE YOU SHOULD, HAVE FUN BEING UNEMPLOYED INSTEAD.

Exactly, the 1979 Chrysler bailout worked because Douglas Andrew Fraser convinced the UAW members that major sacrifices and concessions were needed to save the company. It was Reuther's "equality of sacrifice" formula. With concessionary bargaining Fraser negotiated cuts of $3 an hour and waived restrictions on layoffs so Chrysler could layoff ~50,000 jobs. This lead to Chrysler rebuild itself and eventually payback the loan. You would think the UAW would learn from the past and how this type of concessionary bargaining like lowering wages could save their union workers their jobs in the long run.

 

[skindnef]

You know when shit gets bad we have to sell our toys or whatever. Sometimes we sell them on ebay cheap, right? So why if shit is so dire aren't there FIRE SALES. Why don't we have like the Chevy Aveo for $4000? Sell it all, Fuckers! Eat it for a change Mr. Drive across the Country NOW!, jET BEFORE! Do something about it. When Govt. strangles the free market it's over, how many banks do they own now? Who the fuck is next Sprint? Fuck! Everybody wants FREE $$$! :ranter:

 

[TJ]

Is there any chance of this going back for a re-vote like the bailout several weeks ago?

I sure hope it doesn't as I think this was a good decision but I can't say I'm excited just yet.

 

[Ironslave]

Is there any chance of this going back for a re-vote like the bailout several weeks ago?

I sure hope it doesn't as I think this was a good decision but I can't say I'm excited just yet.

Obama says hopes auto industry can be helped
U.S. President-elect Barack Obama said on Friday he was disappointed by the failure of a Senate deal to bail out the U.S. auto industry and hoped that the Bush Administration and Congress "will still find a way" to help the struggling car makers.
http://news.yahoo.com/s/nm/20081212/pl_nm/us_autos_bailout_obama


Bush changes mind, may save auto giants.

Ten hours after the Senate rejected a separate lifeline for the automakers, White House Press Secretary Dana Perino said in a statement it would be "irresponsible" to let the companies crash. So she said Bush will "consider other options," including the $700 billion Troubled Assets Relief Program that Congress created for the Treasury Department in October.

http://news.yahoo.com/s/politico/20081212/pl_politico/16523






........ something is gonna get done.

 

[Tech]

CHANGE!!

 

[Ironslave]

CHANGE!!

 

[Ryeland]

........ something is gonna get done.

I sincerely hope so. The failure of these three companies would be catastrophic to the average american. Not mainly in the economical sense, but the support sense if you have bought a car from any of these companies in the past few years. Warranties turned useless, no updated training for technicians. Cars are computers these days and repairing them is an insane job. The Big 3 pay for so many technicians to be trained its unbelievable.

Imagine a similar case, microsoft goes under. On one hand, YAY, cuz boo microsoft, but on the other hand. 90% of the worlds computer infrastructure would be left without support. No more security updates, patches. Imagine the cost of all of industry migrating to a new standard. This is what will happen to the auto industry.

Say the Big 3 fail, Honda and Toyota DO NOT have the production capacity to keep up with demand. It would take years before they could build enough facilities to replace the big 3 in terms of production. And in those transition years the demand for cars along with the price would sky rocket. You would have a period of 5 -10 of cars suddenly being far less affordable.

The sudden failure of these three companies would be an absolute disaster. The american steel industry would take a hit, glass suppliers, transportation companies, everything. The market is not ready to replace the big 3 yet. The capital to build new facilities is not there in today's economy.

Those of you hoping they fail have no idea the damage this would cause. If they fail, I hope it happens slowly so that the market has time to up its production capacity to replace them. Unless they are given loans, they will fail suddenly. Chrysler is in critical condition.

As I said, the UAW and the CAW are the real problems here along with trade stupidity.

 

[TJ]

Those of you hoping they fail have no idea the damage this would cause. If they fail, I hope it happens slowly so that the market has time to up its production capacity to replace them. Unless they are given loans, they will fail suddenly. Chrysler is in critical condition.

As I said, the UAW and the CAW are the real problems here along with trade stupidity.

I don't think any of us are hoping they fail. I like GM vehicles but I do not see the benefit of forcing tax payers to pay extra for their mistakes. As others have said before the collapse of these companies would be terrible in the short run but better in the long run. Does anyone truly believe that by giving these companies money they will survive in the long run? While I do think the unions are a big factor has anyone ever noticed how many GM, Ford and Chrysler dealers there are? Maybe it's just the are I live in but their everywhere. Plus, they advertise way too much and produce way too many cars than demanded. Yes, the unions are a factor but so is the piss poor management from the executives of these companies.

 

[Ironslave]

I sincerely hope so. The failure of these three companies would be catastrophic to the average american. Not mainly in the economical sense, but the support sense if you have bought a car from any of these companies in the past few years. Warranties turned useless, no updated training for technicians. Cars are computers these days and repairing them is an insane job. The Big 3 pay for so many technicians to be trained its unbelievable.

Imagine a similar case, microsoft goes under. On one hand, YAY, cuz boo microsoft, but on the other hand. 90% of the worlds computer infrastructure would be left without support. No more security updates, patches. Imagine the cost of all of industry migrating to a new standard. This is what will happen to the auto industry.

Say the Big 3 fail, Honda and Toyota DO NOT have the production capacity to keep up with demand. It would take years before they could build enough facilities to replace the big 3 in terms of production. And in those transition years the demand for cars along with the price would sky rocket. You would have a period of 5 -10 of cars suddenly being far less affordable.

The sudden failure of these three companies would be an absolute disaster. The american steel industry would take a hit, glass suppliers, transportation companies, everything. The market is not ready to replace the big 3 yet. The capital to build new facilities is not there in today's economy.

Those of you hoping they fail have no idea the damage this would cause. If they fail, I hope it happens slowly so that the market has time to up its production capacity to replace them. Unless they are given loans, they will fail suddenly. Chrysler is in critical condition.

As I said, the UAW and the CAW are the real problems here along with trade stupidity.

I think you're missing the point. The thing is they won't even consider changing certain aspects of their business to make them viable. If they go under, the facilities will still be there. Toyota/honda won't have to build new ones, they could just take those over. Most if not all of the engineers/technicians could still have jobs, though they wouldn't pay as well. The glass supplier business could actually increase if the new company starts making products that people in America and the world want. The unions are a major problem, as you mentioned. But, they just had a chance to be bailed out, provided they regress on some of their union benefits. They said no, so hopefully they fail and another company comes in.

 

[Ryeland]

I think you're missing the point. The thing is they won't even consider changing certain aspects of their business to make them viable. If they go under, the facilities will still be there. Toyota/honda won't have to build new ones, they could just take those over. Most if not all of the engineers/technicians could still have jobs, though they wouldn't pay as well. The glass supplier business could actually increase if the new company starts making products that people in America and the world want. The unions are a major problem, as you mentioned. But, they just had a chance to be bailed out, provided they regress on some of their union benefits. They said no, so hopefully they fail and another company comes in.

I really like your optimism, I really do. I am getting a degree in automotive engineering at the university of windsor. So we are right in the middle of this storm. Honda and Toyota do not have the capital to take over theses plants. Re-tooling a plant is really expensive and is a very methodical practice. Honda and Toyota do not have the capital to take up the mantle of the Big 3. The scale on which the Big 3 produce cars is incredible when you compare to most other manufacturers.

The companies will be successful in the long run, it is the unions that are the problem. Ford, GM and Chrysler have proven track records of taking big risks on innovation. Honda and Toyota make money perfecting old ideas, a very sound business plan, but they are never the leaders into a brave new frontier. Ironslave I think you are misinformed about the business plans of the Big 3. There is a lot of bullshit in the media about how all the automakers are run. Toyota and Honda are not God's of quality, in fact GM and Ford have reclaimed top quality honours in the past few years. The Corolla and Camry have been experiencing big quality issues. The main factor behind this is the fact that Toyota is not prepared to produce on the scale the Big 3 do.

I am not commenting on the business plans of the Big 3 as an outsider reading the news. I have been worked in the plants, I have worked with the engineers, I am hoping to be one of those engineers. The problem is the greed of the union. I am not a union hater, but it is they who refuse concessions. It is that fact that makes the business plans unsound. After pensions and other benefits are added in the average union worker is pain over $70/hour by the big 3. They refuse concessions. This is not managements fault.

This would be terrible in the long term for the industry. I really think a great many people underrate the quality of innovation and product the Big 3 bring to the market. Four wheel steering that was short lived on the GM trucks, the adoption of a positrack differential, only using 4 cylinders of an 8 cylinder engine to save fuel, all these ideas were used by the big 3 ahead of the curve. The Ford F-150 is THE truck that industry uses for fleet trucks. Cop cars are American made, why because they handle the abuse.

IS, I do understand the arguments you are making. However, I think you are not giving enough credit to how much the government and unions have tied the hands of the Big 3. If we are going to give $700 billion to the banks, who royally fucked up making obviously poor decisions. I agree the tax-payers shouldn't have to bail the auto industry out, but it was the government and unions who put them in this position in the first place.

 

[Ironslave]

Good points, but the thing is though they were willing to give them money (even though it's beyond their authority). But, the unions wouldn't budge. Whatever the problems are they are largely self inflicted, we've already fell down the slippery slope to bail out banks, so it's understandable for the car companies to want a share too. But that doesn't make it right, as the bailout of the banks wasn't either.

I think the biggest danger is giving them bailout money, and they still end up bankrupt. They should all just go under, and an existing or even a new company should come in and make it work.

 

[Ryeland]

Good points, but the thing is though they were willing to give them money (even though it's beyond their authority). But, the unions wouldn't budge. Whatever the problems are they are largely self inflicted, we've already fell down the slippery slope to bail out banks, so it's understandable for the car companies to want a share too. But that doesn't make it right, as the bailout of the banks wasn't either.

I think the biggest danger is giving them bailout money, and they still end up bankrupt. They should all just go under, and an existing or even a new company should come in and make it work.

What you have said is true. I have not been arguing against those points. If any of the three will survive it will be ford.

I repeat there is no company that could replace any one, let alone more than one of those immediately.

My real theory of their plan is that they will file chapter 11, and then be able to give the union the boot.

As I said Ironslave, none of these companies are stupid or lack innovative and advancing spirits. Their hands have been tied by union and government officials. If given the chance to succeed, Ford will, GM likely will, Chrysler likely will not.

I work for a company that supplies stuff to ford, I am in the advanced R&D dept and the stuff ford has coming down the pipe is amazing. Given the chance, these companies can be back on top.

Like I said, the big 3 are not the lazy giants they are often depicted to be. If given the ability to remove union dead weight they could go a long way.

I think it should be made very public that the reason that these loans, which is what they are, are being held up is that the union will not make concessions.

 

[Duality]