Bailout for the big 3… seriously I don’t think so. Let them burn. Cars suck, companies suck, the unions sucks, workers suck. Need I go on.
It would cost our economy tremendously if they go down. I am not in the camp of market intervention but can our economy handle another shock? I feel that if they do receive government support they need to be completely restructured. The pension liabilities are ridiculous and need to be cut immediately. Innovation is a word that has not been uttered around the offices of Ford, GM, or Chrysler in decades. Maybe the government needs to pay a little additional to bring in some of the best and brightest from overseas to share their success.
The government’s money would be better spent buying up shares of TM.
They suck end of story. Let them fail.
I really feel bad for the workers of the big 3, most of them will have to relocate to find work and it may take a while, but they have been putting this off for 20 years. Toyota, Honda, and Hyundai all manufacture a lot of cars here and aren’t going under. The big 3 have an unsustainable business model that needs to die, not all at once, it it should be an orderly shutdown of operations, kind of like the FIDC with banks.
hum…they’re so big that we can’t let them fail. I know, lets give them more money and force them to consolidate so they’ll get bigger???
I saw a lady speak about this and she said any one of the big 3 going bankrupt would cost a total of 2 to 3 million jobs.
Maybe they go thru restructuring bankruptcy and get rid of a lot of the debt, change the organization, cut a lot of jobs, etc and come out with a little different model, but still operate. I dont see why the govt needs to be involved with this.
kevinf12 Wrote: ------------------------------------------------------- > Maybe they go thru restructuring bankruptcy and > get rid of a lot of the debt, change the > organization, cut a lot of jobs, etc and come out > with a little different model, but still operate. > I dont see why the govt needs to be involved with > this. Who would buy a car from a Company in bankruptcy ?
Overcapacity and legacy costs are the problem and a bailout (as outlined by our fearless leader in the House, Pelosi) won’t solve either of them. Rather than dumping money into a failing industry w/ huge structural issues, congress would be better off spending that money on buying out the workers contracts, taking over the pensions, and telling the UAW to shove their labor contracts up their ass (not politically viable, but necessary). Only if you fix these issues will GM have a future going forward; w/out addressing these issues, they’ll be back next year w/ their hands cups begging “alms for the poor”. I read that the union legacy costs, pensions, and health care benefits adds $2200-2500 to the price of every car they sell. With sales at 2.26 million annually, that amounts to $5,650,000,000 in lost profit. TM, which has comparable sales, banks that money.
Yea it really looks like all these democrats want to bail them out which is complete crap. They will just burn through tax payer funds, they have had 10+ yrs to get there act together and haven’t been able to do it, why do we all of a sudden think they can turn it around…? Looks like Obama wants to help them too…there we go again if something is broke lets have the govt fix it…that always works…right? NO, everything the gov’t gets there hands on is ruined. Sounds a little like socialism to me.
I heard on TV now the credit card companies need a bailout. NO MORE BAILOUTS. People need to stop folding like McCain, Mitch McConnel, Eric Cantor, and the rest of Republicans. Stick to your principles. Let government stay out of things so the market corrects itself. brianr Wrote: ------------------------------------------------------- > It would cost our economy tremendously if they go > down. I am not in the camp of market intervention > but can our economy handle another shock?
A growing chorus of investors believes GM should be put into bankruptcy protection to resolve its bloated labor contracts and debts, and start fresh with new managers who’ll make cars people really want. “Reorganization will end GM’s inefficiencies but if the government props the company up with more bailouts, it will just extend the inefficiencies and let them keep building cars no one wants to buy, at highly overpriced labor,” said Peter Schiff, president of Euro-Pacific Capital. Mayor Bloomberg echoed the opposition to Detroit’s pleas for a $50 bailout. “I don’t know where it stops,” he said on his weekly WOR radio show. “It’s hard to see how they get their act together. . . They haven’t built the kinds of cars the public wants.”
The companies have good business models and Ford and to some extent GM are well positioned. However, the only aspect where they are not cost competitive with Asian makers (even those with significant operations in the United States) is labor. The UAW is destroying their bread and butter. Unions were needed at one time in this industry, but no longer. I would much rather see the management and government actors to balls up and go after the unions. They should allow for the pensions to be separately managed by the unions and the government should help the Big 3 fund whatever amount is necessary for this separation. That would be much better than just allowing them access to low interest loans. However, I don’t think an Obama administration is capable of doing the hard work necessary since Obama already sold his soul to the unions. I don’t mind giving them access to the TARP or a TARP like program since their borrowing costs are destroying anything that resembles a margin, I just would like to see them tackle the core of the problem. Its not the product, its the worker.
they definitely are too big to fail, the number of jobs lost and the knock on effect would be enormous. hat being said they cannot continue to operte the way they have for he last 30 years. They definitely need some major restructuring. As a businessman the companies deserve to fail and dont deserve to exist but as a human being i have to be concerned for all the people that will lose their jobs and the effect tha will have on the overall economy.
i find a lot of parallels between this story and alitalia. anyway, i’m convinced that had the economy not gone sour, they would still be fighting for their lives. would they have tried to get gov’t money if it wasn’t for money already being handed out to banks/insurance companies? A run on the banks isn’t necessarily the same thing as people not buying cars anymore. anyway, by the looks of detroit’s economy, it looks like its a little too late. how many of those jobs still exist in the US anyway? (is there anyone out there that covers the auto industry?)