Will they survive?
Looks bleak to me. I am saddened by this. This was an opportunity for govt, labor, and management to come together to save something important and it wasn’t close. How could we have gotten so ineffective?
Why are these senators biased? They are giving 700B to financial companies and why not only 14 to Automakers. It is just 2% of it. Our economy doesn’t want any more company to go bankrupt. So many jobs have been lost and if automakers go down, they will take 2.5 million jobs with them.
It’ll be pretty dirty. I think we’ll see private investors pick up the scraps of good product lines and wait on producing them. This should be fun to watch.
Screw them! This is (hopefully) a victory for capitalism. The big 3 are diseased. Let them die! Let the A players come out of there and build something great. For once, the American autos will actually have to innovate themselves to success. Yes there will be a lot of pain, but its needed! Its a natural process of our economic cycle. GM is finally aggressively cutting costs as it has stated. That is what businesses are supposed do when they are going under.
The only rationaliztion i can come to is I feel the two bailouts are a little different circumstances. The Banks got greedy and got “caught with their hand in the cookie jar” taking on too many bad loans. However, the system it self and the business model still works. Clean up the balance sheet, flush out the bad loans and poof you are in the black again. Not always that easy but i am saying its a viable structure. The US autos however, it seems to be that they could sell 5 million units or 500 million units and they cant turn a profit. I understand the significance of all the jobs that would be lost i am in the middle of it, but I can understand people questioning whether we should give money because this isnt even a sustainable business model. It will take awhile to right the ship if they survive. Michigan has been in a 7 year recession and been bleeding jobs uncontrollably. The state needs to get of this Big 3 crutch that they have been hobling along on for years. There are still large groups of parents in MI that tell their kids to heck with college because you can just go work at GM and make $65k a year. In the end, they will get the money. But just like the banks…at what cost.
What’s so great about putting these Terry Schiavo-like businesses on life support? Look at the Treasury’s method for granting funds. A bank is either: Healthy and applies – gets funds Unhealthy and applies – doesn’t get funds (unhealthy) Healthy and doesn’t apply – doesn’t get funds (doesn’t apply) So… by that logic An unhealthy automaker is getting the same treatment. There’s no bias here.
Don’t forget the UAW who would not commit to the terms. From watching an “eventful” night on CSPAN2, I did not get the impression that this was purely bipartisan. Don’t get me wrong, bipartisanship had something to do with it, just not all of it. What I gathered is that the Senate was looking for the workers of the Big3 to reduce their pay to be in-line with the Asian automakers. The Senate wanted this done by 2009 and the UAW would not commit to anything before 2011. SO, the UAW did nothing to assist with this and are playing a dangerous game of chicken. Gettelfinger will be going back to the unions stating they might lose their jobs and getting paid nothing instead of taking a pay cut…but will he be on the right side of this dangerous game of chicken? We will see. Sidenote…Someone called into CSPAN asking why the Senate was so adamant that the workers reduce their pay so drastically within 12 months when Congress/Senate has not reduced their pay, their lifestyles or their retirement benefits that we all pay for. He claimed that they are some of the most overpaid individuals for what they get done. Hmmm…pretty interesting angle. Thankfully I don’t have to watch CSPAN or CSPAN2 anymore until the next bailout vote!
Letting the Big 3 fail is like curing cancer with chemo…it sucks for a short while but will be better in the long run. Let them file bankruptcy. I hope the UAW end up owning the Big 3’s assets, then things will get REALLY interesting…
“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.” These guys just don’t know when to quit…just let them fail please!!!
Ford doesn’t need the money. GM got too big to know what the hell they are doing and has a plethora of product lines that should be sold off in a Chapter 11. Chrysler has a $24bn private equity fund behind them. Nardelli asked them for the money but they said no. This was Cerberus’ plan all along to engage in political arbitrage (Quayle, Rumsfeld, etc) with schlepping off the pension obligations to the PCBG and now they are expecting the gov’t to give them cheap loans on top of it.
dzmfntz Wrote: ------------------------------------------------------- > Don’t forget the UAW who would not commit to the > terms. From watching an “eventful” night on > CSPAN2, I did not get the impression that this was > purely bipartisan. Don’t get me wrong, > bipartisanship had something to do with it, just > not all of it. What I gathered is that the Senate > was looking for the workers of the Big3 to reduce > their pay to be in-line with the Asian automakers. > The Senate wanted this done by 2009 and the UAW > would not commit to anything before 2011. SO, the > UAW did nothing to assist with this and are > playing a dangerous game of chicken. Gettelfinger > will be going back to the unions stating they > might lose their jobs and getting paid nothing > instead of taking a pay cut…but will he be on > the right side of this dangerous game of chicken? > We will see. > > Sidenote…Someone called into CSPAN asking why > the Senate was so adamant that the workers reduce > their pay so drastically within 12 months when > Congress/Senate has not reduced their pay, their > lifestyles or their retirement benefits that we > all pay for. He claimed that they are some of the > most overpaid individuals for what they get done. > Hmmm…pretty interesting angle. Thankfully I > don’t have to watch CSPAN or CSPAN2 anymore until > the next bailout vote! i woudn’t be a senator for triple the money they currently make.
I’m against the bailout, why the hell are we paying for the UAW’s retirements and wages? Retirees should’ve hedged their counterparty exposure to the automakers for their pension plans. Workers are overpaid and they damn well know it There’s a reason why cars are built on an assembly line, so that training someone to do their job is very easy. The fact that GM, F, and Chrysler give in to these unions and overpay for unskilled labor just goes to show that they don’t know how to properly manage their resources. Did you know UAW has 800 million in their strike fund? How about this, if they want a bailout, tell the CEOs to give back their pay for the last 5 years, and tell the UAW to hand over their funds. If the govt gets their money back, then the CEOs and UAW can have theirs back. If the govt loses a penny, they get nothing. That way the people responsible for this BS will actually have motivation to fix things instead of business as usual.
f2d Wrote: ------------------------------------------------------- > I’m against the bailout, why the hell are we > paying for the UAW’s retirements and wages? > > Retirees should’ve hedged their counterparty > exposure to the automakers for their pension > plans. > > Workers are overpaid and they damn well know it > > There’s a reason why cars are built on an assembly > line, so that training someone to do their job is > very easy. The fact that GM, F, and Chrysler give > in to these unions and overpay for unskilled labor > just goes to show that they don’t know how to > properly manage their resources. > > Did you know UAW has 800 million in their strike > fund? How about this, if they want a bailout, tell > the CEOs to give back their pay for the last 5 > years, and tell the UAW to hand over their funds. > If the govt gets their money back, then the CEOs > and UAW can have theirs back. If the govt loses a > penny, they get nothing. > > That way the people responsible for this BS will > actually have motivation to fix things instead of > business as usual. This is pretty much the level of discourse about this topic. Expecting retirees to hedge their pension benefits? Huh? Imagine the conflict if UAW was buying massive amounts of CDS protection on automakers. Gee, the workers are all betting that their own company will fail. Good thinking f2d. I suggest that you get a little less bellicose and engage the brain to think about the issue more. There are a few subtleties here you may have missed.
JoeyDVivre Wrote: ------------------------------------------------------- > f2d Wrote: > -------------------------------------------------- > ----- > > I’m against the bailout, why the hell are we > > paying for the UAW’s retirements and wages? > > > > Retirees should’ve hedged their counterparty > > exposure to the automakers for their pension > > plans. > > > > Workers are overpaid and they damn well know it > > > > There’s a reason why cars are built on an > assembly > > line, so that training someone to do their job > is > > very easy. The fact that GM, F, and Chrysler > give > > in to these unions and overpay for unskilled > labor > > just goes to show that they don’t know how to > > properly manage their resources. > > > > Did you know UAW has 800 million in their > strike > > fund? How about this, if they want a bailout, > tell > > the CEOs to give back their pay for the last 5 > > years, and tell the UAW to hand over their > funds. > > If the govt gets their money back, then the > CEOs > > and UAW can have theirs back. If the govt loses > a > > penny, they get nothing. > > > > That way the people responsible for this BS > will > > actually have motivation to fix things instead > of > > business as usual. > > > This is pretty much the level of discourse about > this topic. Expecting retirees to hedge their > pension benefits? Huh? Imagine the conflict if > UAW was buying massive amounts of CDS protection > on automakers. Gee, the workers are all betting > that their own company will fail. Good thinking > f2d. > > I suggest that you get a little less bellicose and > engage the brain to think about the issue more. > There are a few subtleties here you may have > missed. Joey, for the most part I usually agree with you on all topics discussed. However, I am curious as to why you think autos should be given a break. The business model is broken and has been for years. The arrogance of the UAW was appalling. The manner in which these companies asked for money on capitol hill was laughable. I am not judging you just yet, but I would like to know what your reasoning is to save the autos. I am all for a structured bankruptcy in which we piece the good parts of the companies. I have no idea how this would work, but I think its time to separate the A players from the B.
bump