Much has been written about the bailout of the auto industry. When the industry pleads for a bailout, they explain how devastating a bankrupt car industry would be to the U.S. economy. Are you kidding me? Do they have any self awareness as to how hypocritical their argument is?
For decades, the auto industry has let our country down. For decades, they have allowed foreign carriers to march into the United States. At first foreign carriers just sold their cars here. Then, they began building them here. Right under the noses of Detroit, the foreign carriers showed that American workers can make cars and sell them-while earning a profit for their owners. Now Detroit is worried on how the rest of the country will suffer if U.S. car makers go bankrupt? Big Three–thanks for being on the lookout for us, but before we hand over the $25B, would you mind answering a few questions?
- How much damage do you think you inflicted on the U.S. economy by being completely inept over the past several decades?
- Do you think the economy might be doing better right now if U.S. car makers were supplying a ton of cars to China, India, and other high growth areas?
- Do you think your dealer network and auto parts suppliers might have appreciated it if you got your act together in the 1980s? Or the 1990s? Or for that matter the early 2000s?
Here are a few thoughts for the CEOs of Ford, GM, and Chrysler. Take your hands and put them in your pockets. Fly back to Detroit in a commercial airline, making sure you blackberry your chief of staff with instructions to sell off the corporate fleets immediately. While on the plane, do some soul searching. Do you really want to help our country? If so, use bankruptcy (or the threat of it) as the opportunity to fix our auto industry once and for all. Make your number one goal to enable the U.S. to build and sell great cars again. Let pride, righteousness, and even embarrassment be the source of your energy. No handouts. No preserving the status quo. No giving up until the problems of the past are separated from the possibilities of the future. If you are not up to this fight, step aside and make room for someone who is.
Naive maybe. But enough is enough.
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Amen to that Dan! Well said and LONG OVERDUE! I for one am sick of ALL of the bailouts. Either we believe in capitalism or we do not. Keep the government out of our pockets and let mismanaged companies fail…which enable well run companies to flourish. Novel concept I know. Everyone should write their Senator and Congressman to let them know how you feel. It does make a difference.
Let’s quit bailing out companies who can’t manage their finances. Where’s the public education bailout? Unemployment bailout? Social programs bailout (and I’m not talking about welfare)? As a life long democrat, I am usually for the government stepping in and helping those in their time of need, but billion dollar companies who can’t grasp the concept of spending less and making more money deserve what they get. “You reap what you sow.” Think about that one on your private jet back to Detroit. How much money have you wasted on grotesque, gas-guzzling, super SUVs that no one can afford to drive now? Does everyone need a truck that can haul 10,000lbs? Seriously folks, time to take stock in your own mistakes and quit asking for a handout. You screwed up. Now gimme my bailout money… I got bills to pay.
While the “bailout” is actually a styled as a loan to the carmakers, any assistance at this point has to be viewed as counterintuitive:
Why support automakers’ ideology of mediocracy with our tax dollars when Americans are not willing to buy their products (these jokers actually sell interesting small cars overseas, but that’s a different conversation).
Assisting one of our _worst_ performing industries reinforces the notion that the (so called) Big Three can continue to ignore the success their competitors are having with forward-looking products such as the Prius. When GM’s answer to Green transportation is to constantly sell empty sizzle (such as the ridiculous simulated engine sounds the Volt will eventually ship with) instead of streamlining the electric/hybrid project such that it would already be in showrooms, it’s _very_ difficult to find any substantive reason to feel confident that any form of assistance will be spent wisely by these clowns.
Toyota got the Prius in showrooms in 1997. That’s over a decade ago. And where are Ford, GM and Chrysler now? It’s pathetic, to use your word, Dan. Off with their heads.
my fear wasn’t who was going to be president, it was what party controlled which houses and by how much.
the “big 3″ isn’t done making an appearance. wait until february when dems have control of all 3 houses.
unfortunately, pelosi feels she has to give away money to the “big 3″ even though they are guilty of running horrible business models. the “big 3″ need to hold the union’s feet to the fire and change their business, the cars they make and how efficient they are.
seems like the bigger problem is how much $ (and votes) the union ponied up for democratic candidates…unfortunately, some see this as payback (pelosi, levin, etc.)….
i do agree with the earlier comment that everyone should write their representatives and let your voice be heard. if we don’t stop it now, where does it end? american express (owned by berkshire hathaway and worlds richest man, warren buffett) is in line waiting for a bailout as well (hoe unbelievable)…it has to stop…
GM sold over 1 million cars in China last year. They are either the largest, or second behind Toyota, foreign supplier in China.
John, Karen, Matt, Bill and Rob–thanks for the comments. Sounds like a lot of similar sentiments.
Rob–does GM manufacture the China cars oversees? If so, it sounds like GM knows how to build cars so long as they do it without their American workforce.
The cost of labor is crazy high in Detroit. Check out: http://philhardwickblog.wordpress.com/2008/11/12/detroit-auto-workers-compensation-compared-to-the-rest-of-us/
When comparing total comp (salary, tax, benefits)/hour (all US)
Detroit: $73
Toyota: $48
Other Industries Mgt & Professionals: $48
All US workers: $28
What does the UAW have to say?
United Auto Workers President Ron Gettelfinger said Saturday that the problem is not the union’s contract with the automakers and that getting the automakers back on their feet means figuring out a way to turn around the slumping economy.
Really? Is there something in the Lake Michigan water that is making the CEO’s and the UAW delusional? If my tax dollars go toward this, I may move to Canada.
Automakers need to trim their lines. GM dropped Oldsmobile. Chrysler dropped Plymouth and no one missed them.
What’s the difference in these car models besides the name change?
Chevrolet & GMC
Tahoe – Yukon, Silverado – Sierra, Suburban – Envoy, Traverse – Arcadia
Ford & Mercury
Explorer – Mountaineer, Taurus – Sable, Crown Victoria – Grand Marquis, Escape – Mariner.
General Motors sells Chevrolet, Saturn, GMC, Cadillac, Hummer, Buick, Pontiac & Saab.
Ford Motor Company sells, Ford, Lincoln, Mercury, Mazda, Jaguar & Volvo.
Toyota sells Toyota and Lexus.
Honda sells Honda and Infiniti.
Chevy & Ford need to drop about half or more of their models, stream line, innovate and begin to compete again.
They also need to stop making 15 different engines. make 3; a 4 cylinder, 6 cylinder and 8 cylinder. Same with transmissions. To make up to 15 engine variations is wasteful.
People need to wake up the auto industry is asking for a loan not a gift and if they don’t get it then WE the american taxpayer will be handed the medical and retirement expense of some 750,000 UAW retiree’s which is not going to be a loan that get’s paid back.
Also Chevrolet alone sells more vehicles than Toyota or Honda or Nissan or any of the other imports and that is only Chevrolet when you add in GM’s other divisions the number swells. GM’s product quality has improved greatly and while I will agree domestic vehicles were poor in the past the truth is they are at least equal with the imports. Gm has over thirty models that get 30+mpg so get your FACTS straight and get behind American manufacturing or let ye without sin cast the first stone
Rick, I disagree. The money the big 3 auto makers are begging for is so that they can pay the medical and retirement expenses of employees past and present. If they can’t pay it out of profits, they should go through a restructuring. The employees (through their union) destroyed the American auto industry. This doesn’t mean that the auto makers can walk away from this liability–bankruptcy doesn’t allow for this. Instead, a compromise would be worked out as part of the emergence from bankruptcy. The resulting companies would have a chance to become solid and productive businesses once again.
Dan I don’t diagree that the unions have destroyed the domestic auto industry. But I still say that in bankruptcy the big three will drop the retirement benefits and someone will pay for it. Plus would you buy a car from a bankrupt company? not knowing if it has a warranty or if you could buy parts etc. I am not saying the car companies are without fault I am saying the fallout of not loaning them the money would make the telecom losses ( which I would argue caused as much damage to the economy in a much shorter time) look like the neighborhood gas station going out of business
Rick-I need to write a whole series of posts on the auto industry again. Let me sum up a few items that I believe strongly in. First, unions looked out for their union members. I don’t blame them for this. They ensured that a lot of American workers lived prosperous lives, even well after they worked. It took two to tango–management at the time reached agreement with the unions,so if anything is to blame, it is the history of the industry.
Fast forward to today. The big three have built up tremendous debt obligations to union employees past and present. Can they companies make good on these obligations? That should be a question between the company, its shareholders and those they owe money (union employees past and present). If they can’t make good, they should do like any other company and declare bankruptcy. Let the chips fall where they fall.
You say someone will pay for the benefits, therefore government shouldn’t even view the bailout as a bailout. Rick–do you really believe this? Do you really believe that the money and benefits that retired workers are getting will, if they go away, be picked up through normal government programs. That’s like saying that we shouldn’t bail out people who lost their 401K savings as the government will eventually be responsible anyway. Propaganda. If true, what would the union care–their former employees are taken care of either way.
You say the car companies won’t come back from a bankruptcy and jobs will be forever lost. The bankruptcy process will effect each of the big 3 differently. GM would need to go in first. Perhaps Ford and Chrysler, seeing this, make the hard decisions and also benefit from a drop in GM demand–and never even need bankruptcy. But let’s assume they all go into bankruptcy. First, now is the time to do it as new car demand will be low in 2009 regardless. Timing will be good. Second, they will control their own destiny. If they turn their bankruptcy into a multi-year brutal battle between unions and the company, they will seal their faith. If they find a compromise early on, they will be able to present a strong case that they will emerge as stronger more reliable car makers. Government intervention gives them a cop out. Make resolving this their burden, not ours.
What if you are right? What if they never emerge? I say, “oh well”. Americans will buy cars still. Many of the cars will be built here in the good old U.S.–Indiana, Tennessee, Ohio, etc. I trust American entrepreneurship will find a way to ensure that a new and better car industry emerges. As for Michigan–please see the prior paragraph. They control their own fate. If they want to remain the center of the U.S. auto industry, fix your companies once and for all.
One more thing. New car sales are going to be pathetic this coming year. How deep are they cutting production? Oh yeah–I forgot. Workers get paid even if production stops. So what will our bailout go toward–to ensure that the union contract that protects workers even when they are unneeded gets funded by the rest of us. Don’t you think other industries would like to continue to keep their workers and have them paid by government hand-outs in this downturn?
Dan I am short on time so I will only answer part of this.
1. yes cars would still be built here but the profits from the imports is and would still be sent overseas to banks in Japan. (no one seems to want to recognise that fact)
2> if you have been watching the meetings between the big three and the government it has already been decided that the pay for not working must end and the union has reluctantly agreed.
3. The unions agreed 3 years ago to assume the future retirement debt from the manufacturer but the account has yet to be funded so yes I believe we the people will get the burden at least of the health care and very likely their retirement
Bad Mouthing American / Canadian Vehicles
Get the Facts Straight !
Here are some facts from the WEB that don’t get the press they deserve – next time you hear negative comments about domestic this may come in handy it also has the sites that the info came from as well. Pay particular attention to #13 – It says a lot
1. Which country can boast that their brands occupy 2 of the top 3 spots for long-term reliability?
a. Germany
b. Japan
c. Korea
d. United States
2. As of August 2007, which manufacturer had the most recalled vehicles in the U.S. for that year?
a. Chrysler
b. Ford
c. GM
d. Nissan
e. Toyota
f. Volkswagen
3. Pick the brand from each group that has the highest initial quality.
a. Acura, BMW, Cadillac (all luxury makes)
b. Honda, Mercury, Nissan (all non-luxury makes)
c. Acura (lux), Chevrolet (non-lux), BMW (lux), Mazda (non-lux)
4. Which midsize sedan has the highest initial quality?
a. Accord (Honda)
b. Altima (Nissan)
c. Camry (Toyota)
d. Malibu (Chevrolet)
5. Which large sedan has the highest initial quality?
a. Avalon (Toyota)
b. Grand Prix (Pontiac)
c. Sable (Mercury)
6. Which midsize pickup has the highest initial quality?
a. Dakota (Dodge)
b. Ranger (Ford)
c. Tacoma (Toyota)
7. Which car is the most economical overall?
a. Aveo (Chevrolet)
b. Fit (Honda)
c. Prius (Toyota)
8. Which car did the LA Times describe as “a better car than BMW or Mercedes or Lexus or Infiniti”?
a. A6 (Audi)
b. CTS (Cadillac)
c. RL (Acura)
9. Which company makes the winner of the 2008 “Green Car of the Year” award?
a. Chevrolet
b. Honda
c. Toyota
10. Which car was selected by the North American automotive press corps as the “North American Car of the Year” for 2007?
a. Aura (Saturn)
b. Camry (Toyota)
c. Fit (Honda)
11. Which car won the same award for 2008?
a. Accord (Honda)
b. Altima coupe (Nissan)
c. Malibu (Chevrolet)
12. Which company had a luxury vehicle, a midsize sedan, and a large truck removed from the Consumer Reports recommended vehicles list in October 2007 because of mounting quality problems?
a. Chrysler
b. Ford
c. General Motors
d. Hyundai
e. Toyota
f. Volkswagen
ANSWERS:
1. Which country can boast that their brands occupy 2 of the top 3 spots for long-term reliability?
Answer: United States.
Per J.D. Power Vehicle Dependability Study, Mercury and Cadillac are in the top 3, along with Lexus. And in 2007, Buick was tied with Lexus for the top spot.
http://www.jdpower.com/corpor...
2. As of August 2007, which manufacturer had the most recalled vehicles in the U.S. for that year?
Answer: Volkswagen.
According to Business Week, Volkswagen had the most recalls at this time a year ago. The second worst was Toyota.
http://www.businessweek.com/a...
3. Pick the brand from each group that has the highest initial quality.
a. Answer : Cadillac (better than both Acura and BMW)
b. Answer: Mercury (better than both Honda and Nissan)
c. Answer: Chevrolet (better than Acura, BMW, and Mazda)
This is according to J.D. Power’s Initial Quality Survey.
http://www.jdpower.com/corpor...
4. Which midsize sedan has the highest initial quality?
Answer: The Chevrolet Malibu has better initial quality than any competitor, including the Honda Accord, Toyota Camry and Nissan Altima. The Ford Fusion also beat all 3 Japanese competitors.
This too is from the J.D. Power Initial Quality Survey, which also reveals that above average are American brands Mercury, Ford, Cadillac, Chevrolet , Pontiac, Lincoln, and Buick. Below average are import brands Acura, Kia, Nissan, BMW, Mazda, VW, Subaru, and Scion (and several others).
http://www.jdpower.com/autos/...
http://www.jdpower.com/corpor...
5. Which large sedan has the highest initial quality?
Answer: Again per J.D. Power, the highest quality large car is the Pontiac Grand Prix, beating the Toyota Avalon. Two other Detroit cars that beat the Avalon are the Mercury Sable and Mercury Grand Marquis.
http://www.jdpower.com/autos/...
6. Which midsize pickup has the highest initial quality?
Answer: The Dodge Dakota has the best quality for midsize pickups, proving that Chrysler too can beat the imports. Both the Dakota and the Ford Ranger beat the Toyota Tacoma.
http://www.jdpower.com/autos/...
7. Which car is the most economical overall?
Answer: Per Edmunds.com, the premier automotive analysis site, the most economical car in America, taking into account not only mileage but all costs, is the Chevrolet Aveo. The Honda Fit is #3 and the Toyota Prius is a distant #34.
http://www.edmunds.com/help/a...
8. Which car did the Los Angeles Times describe as “a better car than BMW or Mercedes or Lexus or Infiniti”?
Answer: “Cadillac makes a better car than BMW or Mercedes or Lexus or Infiniti, and that car is the 2008 CTS. No other car in the mass market dares so much as this expressive and audacious bit of automotive avant-gardism.” Dan Neil, LA Times.
http://www.latimes.com/classi...
9.. Which company makes the winner of the 2008 “Green Car of the Year” award?
Answer: The Chevrolet Tahoe Hybrid is the winner of this award.. How could a full-size SUV defeat the media darling Toyota Prius? Read the link below and you will discover, “What’s equally eye-opening is that the Tahoe’s 21 mpg city fuel efficiency rating is the same as that of the city EPA rating for the four-cylinder Toyota Camry sedan. ”
Did you catch that? A huge, full-size SUV from Chevrolet that gets the same city mileage as a 4-cylinder Toyota Camry!! Chevy obtained this remarkable achievement through the use of its 2-mode hybrid system, a technology that Toyota does not have.
http://www.greencar.com/featu…/
10. Which car was selected by the North American automotive press corps as the “North American Car of the Year” for 2007?
Answer: Not only was the Saturn Aura picked by the automotive press corps as better than the Honda Fit and the Toyota Camry, “When a panel of 47 journalists named the Saturn Aura the North American Car of the Year over the Toyota Camry, the vote wasn’t even close, 205-89.” Chicago Tribune, 1/15/07
http://www.northamericancarof...
11. Which car won the same award for 2008?
Answer: GM again crushed the Japanese competition in 2008 when the Malibu received 190 votes to the Honda Accord’s 95. The Accord actually came in 3rd since GM’s other finalist, the Cadillac CTS, received 165 votes.
http://www.northamericancarof...
12. Which company had a luxury vehicle, a midsize sedan, and a large truck removed from the Consumer Reports recommended vehicles list in October 2007 because of mounting quality problems?
Answer: Toyota’s much publicized quality problems resulted in Consumer Reports actually removing from their recommended vehicles list the Lexus GS luxury car, Camry V6 sedan, and Tundra pickup. This demotion occurred in October 2007.
13.If you are one of the many Americans who gave up on Detroit’s cars because of a bad experience many years ago, it’s time to rethink your position. Rethink Detroit.
Detroit automakers: 79 U.S. jobs per 2,500 cars sold in America.
Foreign automakers: 33 U..S. jobs per 2,500 cars sold in America.
levelfieldinstitute.or…/
Here is a letter written by one of my friends who works for General motors
The media has done nothing but give myths and misconceptions of the Domestic Auto Industry. For example, I continually hear the American car manufactures don’t build vehicles people want. The fact is the big three has about 50% market share in North America. Putting this another way, for every two vehicles sold, one of them are a domestic vehicle. Another myth is the imports quality is better. Go to JD Powers web site and you will find that American cars are on par or better then what is coming out of Japan or Germany. Also, 50 independent journalists reviewed all the latest offerings in the mid size car segment. The winner was not a Toyota, Honda, or any other import. It was the Chevrolet Malibu. The big three have received a lot of criticism about building SUV’s. It’s funny how they don’t mention that Toyota also sells SUV’s.
As for innovation, GM is going to introduce the new Chevrolet Volt in 2010. This car is a game changer. Studies show that the average American drives less then 40 miles a day. If they drive a Volt they will never use a drop of gas. If they want to take a trip there is a gas generator that kicks in to keep the batteries charged. When the gas generator is running it is estimated that the Volt will average between 55 and 70 miles on a gallon of gas. You can plug your Volt in at night to charge the batteries. To charge the Volt it will cost about a buck. By the way, GM is the only car company in the world that has the necessary resources to develop this car completely in house. Toyota can’t do that nor can Honda. I really believe that the Volt will do for the car industry what the Apple I-pod did to the music industry. The prototypes are on the ground and running and so far they are exceeding everyone’s expectations. They work.
The big three is on the ropes and have asked the government for a bridge loan to get us through this tough patch. It’s not a hand out. Many people feel that it would be better if they declared bankruptcy and reorganized. That might work for an airline. After all people will fly a bankrupt airline. It’s a two hour relationships and a few hundred dollars. Buying a car is a five year relationship. No one is going to buy a vehicle from a car company that declares bankruptcy because of the fear of not having their warranty honored or getting parts. What about resale value? The fall out of one or more of the big three going belly up would have devastating consequences for our economy. One in 7 jobs is affected directly or indirectly in North America. Can we take the chance with our current economy to allow the Domestic Auto Industry to declare bankruptcy ?
I was very disappointed that a small minority of the GOP killed the bridge loan for the Domestics in the senate. On of these individuals was Senator Shelby. The American Tax payer has given 3 billion dollars to the transplants in his state. I don’t remember Shelby asking the tax payer. The money was used to provide the land, utilities, training, and cash to Toyota, Honda, and Mercedes Benz. So I guess it’s ok to help the Japanese and Germans but when his fellow Americans asked for help we got our hand slapped away. People forget that the big three created the middle class. They built the weapons that help win World War II. Think about the billions in taxes the big three have paid over the last hundred years. When September 11 happened the big three donated millions. GM came out with zero percent financing to keep the economy going. Toyota and Honda did nothing. When our government has come to the big three for help they have always answered the call. GM turned 100 years old this year. Not once has GM ever asked our government for help. Well, it’s our government’s turn. Other countries protect their auto industry. What happened to our great leaders? It seems our government is full of egotistical, selfish, corrupt individuals. We must look like a joke to the rest of the world.
I have been with GM for almost 26 years. I have gone through one reorganization after another. GM has been downsizing for years. Since the start of this decade GM has reduced their employee head count by 50%. We have less employees then Nissan yet we are still selling more cars and trucks then anyone else including Toyota. There are over one million retirees that get their pension and health care through GM. These are our senior citizens. GM is trying to keep their commitment to these people who depend on these benefits. Since the nineties, new hires to GM do not get a pension when they retire. You only receive what you put in to your 401 K. It’s obvious that more will have to be done to make the domestic auto industry viable in the future. But this current financial crisis was not their fault. No one could have foreseen gas shooting pass four dollars per gallon or the financial melt down we are currently going through. People buy cars on credit. It’s the life blood of the business. It will get better. When? Your guess is as good as mine. But in the meantime we have to keep the domestics going until the economy begins turning around. Your job just might depend on it.
Rick, I will confess that you present some compelling facts. They strike me, however, as one sided. You do not present a comprehensive and balanced portrait of the opportunities AND challenges that the Big Three face.
If GM has so much going for it, it should be able to solve its problems without government intervention. I don’t buy into the bankruptcy option as being catastrophic on America. If GM and its unions find a way of being constructive and decisive, they will sort through enough issues that will enable the company to emerge with less shackles than it currently has. If it does this, it will have an opportunity to become a respected industry leader again–and this is what all American want of the Big Three. Believe me, I look forward to the day that I buy an American car again–but I want to buy it because it is the best car, not because I am be a patriot. I want the Big Three to earn my business, not guilt me into supporting them.
GM is to big. Too many brands. Too many cars. Fix this. Reduce the burdens caused by needing to over-support past generations of workers. Change your relationship with today’s workforce so that management and blue collar workers can collaborate toward success. This is what we want to here…not that you are dong the best you can and just need more doe.
Since the american industry is so pathetic and the Japanese are so strong why is Toyota now asking a Japanese bank for a loan follow this link http://english.aljazeera.net/business/2009/03/20093393113452846.html
also do you know why they are asking a Japanese bank? It is because that is where their profits go not into an American bank so all of you import drivers wake up!!!!!
Rick,
Do your facts include that for a short while that Dodge and Chrysler were owned by Daimler(Mercedes Benz) and therfore was a foreign owned Big 3?
Do you agree with the notion that someone who oeprates a robotic arm to put in a seat deserves $30.00 per hr + fringe? Better yet do you think it is fair that every time a plant is furloughed all workers get 95% of their pay and full benefits?
My former Father in Law was GM for 32 years and he did ALWAYS spend his extra money, because the UNION PENSION would be there. The UAW never taught any of these unskilled workers anything about extra savings, investing, etc. They told the Fairfax KS plant employess to not buy stock, “cause it means your a company man and not a union worker”
They used out right lies to the line worker to scare them into voting, especiaky in the 80’s. My fomer FIL is notw desititue and broke and cannot afford to live on his SS and pension only and now is trying to find work again. Not only is he battling age discrimination, but he has NO SKILLS! 32 years on a line and not one marketable skill was ever taught, except how to drag production schedules out and play games to keep on getting and keep on screwing the management man.
I agree with DAN 100% if GM is doing as well as you seem to spin, then why are they taking MY MONEY!
oh yeah that’s right to fund a over zealous pension fund.
Scott if you read further up you will see I am no fan of the unions and their deathgrip on industry in fact it is one of the main reasons that they are in the shape thay are in. that being said hindsite is 20/20 your ex father in-law is a classic example. I have not stated the american automobile industry is in great shape I have been talking about the quality of the product and the fact that so many people buy imports without thinking the effect it has on the american economy. And the money going to the big three is a LOAN.
The banks and AIG and people without enough common sense to live within their means are the ones taking your money and the LIBERALS are giving it to them that is what should anger you and every other working american. I know it angers me
Rick,
Understand thanks for the clarification. Did you see the new headline out today? GM’s auditor and CFO now say BK is in the cards for GM. Quality is something of a different topic, I know far too many GM owners that have had more miles put on the the car taking it to the shop than out on the road.
I do give kudo’s to Ford for not taking any money(so far) Ford saw it coming imho and that is why several years ago, they started selling off Range Rover, Jaguar, etc.
I think you will agree that the liberals give entitlements out to keep their base, they want to have an amnesty plan for Illegals to enlarge the base, they will do everything in their power(just as the GOP did) to keep CONTROL AND POWER, and that includes their new golden boy, obamanation.
Washington is only concerned with POWER and CONTROL and until everyone wakes up to the fact that the current 2 controlling parties have destroyed the electorate, nothing will change.
The Liberals are more dangerous because they have this notion they are better, smarter, and have better hair and they have the media in their pocket to help keep the sheeple stupid.
TAX & SPEND just like the last 8 years of GOP dominance.
It’s time for a good ole fashioned tea party and possibly another revloution(non-hostile of course)
This is not directed at you by any means, but I am already seeing & hearing liberals screaming that they cannot believe after giving billions to GM, they will likely fold anyway. To them I say:
you voted for it, now cowboy up and enjoy what obamanation is doing. more is coming, guvvie has no place in business, we learned that during FDR’s first new deal.
The media is soo busy propping this guy up, they are forgetting that people will wake up and start shifting.
mid-term elections may see a change like no other, lets hope the tables are ran and not a single DEM or GOP is elected and we start seeing indies getting voted in by droves.
I also find it very comical that several of Obamantions nom’s have failed or simply forgot to pay their tax bills. Maybe every tax payer ought to send a message to obamanation by not sending in their tax bills. Hey what’s good for your nom’s are good enough for us.
speaking of which, did any of the vetting teams insure our new FCC head paid his tax bills yet?
Scott I couldn’t agree more I don’t know if GM will file although in my opinion it might be the best thing for them. Chrysler I think is going to sink like the Titanic and soon. Ford borrowed 23 billion a year or so ago so don’t be fooled by them not asking for money now as they are just as heavily in debt as the others. Asfar as quality I have seen great improvements in GM and Ford not so with Chrysler. I follow JD Powers and they talk highly of GM’s quality and I see it daily but that being said none of this would even be happening if the Dem’s would have listened to the previous administration about the housing industry I have a link that you might find interesting
http://www.youtube.com/watch?v=cMnSp4qEXNM
Did anyone happen to notice that Buick Has knocked Lexis out of the top spot on JD Powers survey as the most reliable car made?
Yes it is our American Auto industry that is so pathetic but look here
In Toyota City, Japan, the good times rolled . . . away
The ultimate company town thought it was immune from economic downturns. But that was before the global recession hit and the automaker started slashing jobs.
By John M. Glionna
March 22, 2009
Reporting from Toyota City, Japan — When times were good and the auto business hummed along like a finely tuned engine here in the Detroit of Japan, this tightknit company town was considered a workers’ utopia.
City officials were the envy of the nation, nursed by a paternal multinational firm that paid generous wages and showered the community with perks such as a top-notch sports stadium, concert hall and art museum — all carrying the Toyota brand name.
That was before the worldwide economic pileup that brought widespread personal wreckage to the hometown of the world’s mightiest automaker.
Unlike in Detroit, where years of steady decline preceded the current financial crisis, Toyota City’s fortunes went from cruise speed to brick wall. Regarded a model of economic prosperity, it endured an unthinkable drop from first in the country to worst in less than nine months.
In this community three hours southwest of Tokyo, it’s a phenomenon known as Toyota Shock.
“Toyota City is hurting,” said Norio Seki, general director of the city’s industrial labor division. “We’re in trouble.”
Last summ er, Toyota was just months away from overtaking General Motors as the world’s biggest car company. Jobs were plentiful here in Toyota City, where 80% of workers are employed in the auto industry.
Then Japan slumped into recession. Exports in the world’s second-largest economy plummeted at a record pace, and domestic demand dropped alarmingly.
Mammoth blue-chip firms such as Toyota and Sony weren’t exempt from the financial carnage. Even before announcing last month that it was facing its first annual net loss in 59 years, Toyota had begun an unprecedented production slowdown that called for reduced shifts and 10-day closures at its 12 domestic plants.
It also fired 9,000 contract workers — more than 10% of its 85,000 employees — and warned that more firings could follow, even among once-protected full-time workers.
As a result, Toyota City saw its number of available jobs fall more than 50% between October and December compared with the same period of 2007, officials say.
January brought more bad news: The number of job seekers soared 130% from the same month in 2008, from 1,489 to 2,627. That brought Toyota City unwanted attention as Japan’s most out-of-work town.
“There used to be so many jobs we couldn’t fill them all, but that all dried up overnight,” said Masami Kawajiri, director of a federal job center in Toyota City. “Now our only choice is to do our best for job seekers, one by one. To think about them all at once would be too overwhelming.”
City hall has fared no better: Officials predict a 96.3% drop in the corporate taxes they’ll collect this year, a loss that jeopardizes city services. The Aichi prefecture government, which relies on Toyota for one-fourth of its corporate tax revenue, is projecting a $1-billion shortfall in 2009.
For its part, the automaker can only watch the decline of its home city as its scrambles to climb out of its own financial hole.
From an operating profit of $37 billion last year, Toyota expects a $5-billion loss for the fiscal year ending March 31. The company is also seeking government loans to hold off private investors demanding as much as 50% in interest on the company’s debt.
“We know Toyota City has been hit on the chin, and we feel a responsibility to the community,” said Paul Nolasco, a Toyota spokesman in Tokyo. “But here’s an indication of how cloudy our situation is: We haven’t even come up with a global production and sales plan for this year.
“We usually release that in December, but here it is March and we haven’t done it yet. That’s the biggest indication that we’re still looking for direction.”
Hurting just as much are hundreds of smaller companies here that supply the Toyota colossus with the parts to construct its cars, including mufflers, door parts, windshield wipers and headlights.
In a city where one-third of the 1,400 employers are auto-related, many of the firms say Toyota’s production cuts will cause bankruptcies unless they too can q ualify for government loans.
“We have no way to make the situation better — we just have to wait and see what happens with Toyota,” said a manager in a car window parts company who asked not to be named. “People are afraid to talk because they are afraid of Toyota, but we’re all very nervous.”
Toyota City’s downturn baffles residents. After all, this was the home of Japan’s largest company. Financial woes might be a reality in other parts of Japan, but not here.
“This thing took us by surprise,” said one former Toyota employee who declined to give her name. “Who would have ever guessed that recession would come home to roost here? This is a car town and the world needs cars, right?”
Toyota City is a somewhat isolated community on the last stop of a subway line based in the nearby bigger city of Nagoya. Most people here support the hometown company and drive Toyotas.
Not far south of downtown sits the automaker’s massive complex of factories and research and development centers. It carries an air of big-brother mystery, even among locals.
The main gate is guarded, and a visitor who tried to take pictures from the public street was quickly shooed away.
The city has the typical signs of stress: plummeting property sales, empty storefronts and restaurants. But there is another commodity that the town has lost to the recession: foreigners. The representatives from Toyota suppliers and customers from the U.S. and Europe who used to pack downtown’s hotels are gone. Some say occupancy rates have dropped 90%.
For 13 years, Kevin Yuhara has run his tiny restaurant-pub in the heart of downtown, catering to foreigners who did business with Toyota. The U.S. college sports memorabilia, collection of Toyota caps and Polaroids covering the walls capture the atmosphere of drinking and laughter of the mostly American clientele.
Now the place sits empty, except for the occasional Japanese customer.
“For more than a decade, we had some good times here,” said Yuhara, standing next to a flying-pig toy hanging from the ceiling. “But now the party’s over, the town’s major company is hurting, and the foreigners have all gone home.”
At city hall, faces are grim as officials look for answers.
Seki, the industrial labor division head, said Toyota City and Detroit have for years been “sister cities” and share several cultural exchange programs.
Though he has never called his counterpart in Detroit for advice, Seki says there are many questions he’d like to ask. The economic malaise has prompted officials to reconsider the city’s future as a one-company town, he said.
“I’d like to know how they handle unemployment at this scale,” he said of Detroit. “I’d like to know what other industries they are looking into. How can you use the technology used in the auto industry for other kinds of enterprises?”
Seki says the two cities are different in key ways. Unlike most American workers and employers, Toyota City and i ts citizens have savings they hope will see them through the hardest times.
Toyota City has remade itself before, locals say. During the Depression, the city was a silk production center named Koromo. The stock market crash destroyed the industry, so an ambitious loom maker named Kiichiro Toyoda turned to automobiles instead.
Nobody here expects that another such drastic personality change is in Toyota City’s future.
“In the long run, we don’t think the auto industry will fail,” Seki said.
“Humans drive cars. It’s what they do.”
I see no one else is contibuting anymore is it because they realize that the auto industry problems are a result of our current economy or do you still choose to ignore the imports are having problems also
Rick, I am a nice blogger and try to refrain from fussing with my loyal readers, especially those who leave comments. But to this comment I can say only one thing. You have got to be kidding me!!!!
Your comment is an unfortunately illustration of all that is wrong with the U.S. auto industry. “It ain’t are fault,” is your cry. The U.S. auto industry was pathetic a year ago, two years ago, five years ago, ten years ago and 20 years ago. To say that today’s problems are a result of the economy is just the excuse du jour. Auto Industry–take accountability for your problems. Fix them without reaching into tax payers’ pockets. Challenge yourselves to do whatever is necessary to make the industry strong again. And most importantly, stop blaming others for your problems.
Dan,
you make a great point in fact (I borrowed your own post) I think the very same way about:
The U.S. banking and finance industry was pathetic a year ago, two years ago, five years ago, ten years ago and 20 years ago. To say that today’s problems are a result of the economy and bad CDS bets, etc is just the excuse du jour. banking and finance Industry–take accountability for your problems. Fix them without reaching into tax payers’ pockets. Challenge yourselves to do whatever is necessary to make the industry strong again. And most importantly, stop blaming others for your problems.
If you are this passionate about the auto industry then you should be that way about the banks and all forms of bailouts. All that is happening is another transfer of wealth paid for by the tax payer. Omni Bank of Atlanta failed today and guess what, it makes the 21st bank of 09…
Did the earth stand still? Did taxpayers have to fund something?, did it cause a cataclysmic event that caused a chain reaction of other failures of banks, investors, VC’s, etc? did it do exactly what this administration said would happen if banks fail? and cause chaos, etc!?!?
Nope….Suntrust of Atlanta bought the assets and deposits.
“WOW! Holy non bail out batman!!!free markets still work.”
“Yes they do robin, especially when the system is allowed to work when the agents of “change” and their FUD henchmen are kept at bay!”
you cannot have it both ways Dan
Dan I still haven’t heard anything about the imports do you and the rest of the contributors still maintain that they walk on water? Just like the press you choose to ignore the facts the entire industry is down. I guess it is alright for Toyota and Honda to be down and looking for money but not the American Companies. I guess we should just let anothe Hundred year old industry go overseas permanently. And then we can all get togeher on a blog and woder why there are no American jobs
Rick, accepting defeat and/or government handouts would be one alternative. The other would be for the U.S. auto industry to stop whining and get its ship straightened out. Instead of looking for government dependence, make itself lean and mean and out-compete the rest of the world. I’d rather have no auto industry than a pathetically uncompetitive one. But I’d rather see us get an attitude–as in winning attitude–and make our industry strong for the long term.
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Detroit News
By Christine Tierney
Oct. 8, 2009
Toyota Motor Corp.’s Teflon coating is peeling off in large strips as a series of mishaps generates bad publicity for the mighty Japanese automaker.
From a huge safety recall to fix loose floor mats to an investigation of corrosion in some of its trucks and the shutdown of a California factory, the company is grappling with issues common to most automakers but not, until recently, to Toyota.
Up until 2008, Toyota had been profitable through boom times and recessions. It had built a sterling reputation for producing quality vehicles, and its manufacturing methods were emulated by nearly all of its rivals.
Many industry experts say the company can weather its recent misfortunes. “Toyota has been building up decades of good will and their buyer is very loyal and believes Toyota would never purposely hurt them,” said Rebecca Lindland, director of the Autos Group at IHS Global Insight in Lexington, Mass. She added, however, that “the number of issues is building up.”
Others see a real risk to its reputation. “A company like Toyota can handle isolated incidents, but it’s the pattern of mishaps and mistakes that are the nemesis,” said Jeff Caponigro, president of Caponigro Public Relations Inc., with offices in Southfield and Tampa, Fla.
“It’s the pattern that gets weaved into a wet, cold blanket that can tarnish their reputation,” he said. Caponigro was an adviser during a huge 1995 recall to fix seat belt buckles made by Japanese supplier Takata Corp., for many car brands.
Caponigro said Toyota is exposed after achieving the No. 1 ranking in many areas: global sales, profits and customer satisfaction. “When companies reach the top, plenty of people want to push them off the mountain.”
At Toyota, the run of bad news has shaken executives. In remarks to reporters on Friday, Toyota President Akio Toyoda apologized to customers concerned about the quality of their vehicles.
In terms that startled reporters, he described the company founded by his grandfather as being a step away from “capitulation to irrelevance or death.”
Toyoda expressed deep regret for the crash of a Lexus car near San Diego that killed its four occupants. An ill-fitting, loose mat is suspected of contributing to the accident, which prompted an urgent safety advisory, which will be followed by a recall of 3.8 million Toyota and Lexus vehicles.
That would exceed Toyota’s largest U.S. recall to date involving more than 900,000 vehicles in 2005 to replace steering relay rods.
This week, the National Highway Traffic Safety Administration began a preliminary evaluation of reports of corrosion in the steel frames of previous-generation Tundra trucks. It can damage brake lines and cause the spare tire to separate from the rear cross-member. The investigation affects 218,000 2000 and 2001 model-year Tundras.
Other issues dogging Toyota include a lawsuit by a former in-house lawyer alleging that the automaker concealed and destroyed accident data.
The company has said little about those allegations. “We’re confident that our practices maintaining documentation regarding product liability will be substantiated,” said Irv Miller, group vice president of public affairs at Toyota Motor Sales in Torrance, Calif. But “we’re not going to play our case out in the media.”
Toyota has not sought outside specialists to assist in damage-control efforts. “These are unusual times for everyone. It’s unfortunate that several of these issues are long-term issues,” he said.
U.S. government safety inquiries can take months, as can lawsuits. The fate of the New United Motor Manufacturing Inc. in Fremont, Calif., will be a sore subject through the winter in the state where Toyota has its U.S. headquarters.
Toyota announced in late August that it would halt production at the end of March after its partner, General Motors Co., pulled out of the 25-year venture.
After losing $4.3 billion in the year to March 31, Toyota is struggling to return to profitability but is hampered by excess capacity and the strength of the yen.
On Oct. 1, during Toyota’s monthly U.S. sales call, Senior Vice President Don Esmond said the company had not detected any shifts or drop off in showroom traffic after the recall announcement. Its U.S. sales are down 27.7 percent this year, in line with the overall market.
Kurt Sanger, a Tokyo-based analyst at Deutsche Bank, estimated the recall will cost less than $100 million. “To us the risk seems more reputational,” he said. “There is also the risk of financial reparations related to at least one fatal incident. It is our understanding this case is still under investigation with no determination of cause or fault.”
80% of the Toyotas sold in the last 20 years are still on the road.
I would like to see the proof of that plus 100% of Toyota motors co profits went to Japan yes i have heard the arguments that they are built here but the profits leave this country
How about this for proof? Toyota Motor Corp has a 126B market cap and GM (Motors Liquidation) is traded on the pink sheets. In fact, GM would cease to exist were it not for the generosity of the US taxpayer.
Let’s see where Toyota is after 100 years in the market when they also have some legacy costs in this country. Toyota has only been manufacturing in this country for 20 years their cost structure will soon be going up. and you didn’t address the Fact that the profits go to Japan I don’t see how any American citizen can be okay with that
Now you see what Toyota thinks of you loyal Toyota owners they lied and covered up documents about the acceleration problem with their vehicles resulting in death and injury. OH WHAT A FEELING!!!!