The Big Three

[Yuwipi Woman]

Take a look at what they produce for a sec. Are they making the best cars they can? They've had this to a science for so long.

These people and the rest of them need to go. I don't mean away.

They are producing better cars now than they were 10 years ago. The rate of manfacturing errors at Ford has been going down every year. Last I heard it was lower than Toyotas (Consumer Reports). I'm current driving one and I'm quite happy with it (other than the milage). They really need to work on fuel efficiency.

 

[TomPaine]

It deserves meltdown. Consequences aren't just for ordinary people.

Whether it deserves it or not, the consequences will be for ordinary people, people like my inlaws .

TomPaine

 

[TomPaine]

and to add to the above.. and mechanics, and the guys who wash cars next door, and the two takeaways where people buy their lunch, and the burger wagon etc.
I hate to think what people who need health care are going to do when they lose their coverage.

TomPaine

 

[goebfwai]

I don't think they should be allowed to go to the wall, but the US
government should realise that the historic pyramidal, from the top-down
way of running these companies just didn't work.

If the workers were running the company, or at the very least had a major
core say in the direction of the company, I'd imagine years ago the workers
would have gradually come round to a decision to move the company towards
electric/hybrid/hydrogen cars.

Instead, they've had directors with fat pay packets merrily ordering the production of gas-guzzling cars,
when everyone has known for years that the era of cheap oil was coming to end. And they sure as heck knew
that the current credit-fuelled boom, would eventually end up in a bust. They happen often and predictably enough!

They're being squeezed from both ends, economically and through a lack of technological innovation.

Perhaps if they banned foreign imports of cars, smelt down the cars they can't sell (that will just end up rusting away) and go back to the drawing board, they could salvage the companies?

On the topic of the UK economy, I've noticed solicitors firms with a heavy dependency on
conveyancing are shutting down all over the place. When you see solicitors start shutting
down (and this early too), some that have been there for decades, you know this recession is set to be severe.

US Futorologist Predicts Revolution, Food Riots, Tax Rebellions By 2012
http://uk.youtube.com/watch?v=46MEqEgdLTg
http://www.naturalnews.com/News_000474_financial_collapse_food_supply_social_unrest.html

 

[TomPaine]

Perhaps if they banned foreign imports of cars, smelt down the cars they can't sell (that will just end up rusting away) and go back to the drawing board, they could salvage the companies?

Brown was warning the US not to bail out the car manufacturers or resort to protectionism, as the result would be a knock on effect in Europe etc.
I don;t know what the answer is to be honest.

I would have thought the best route would be to nationalise the Big three and sell of the profitable bits to investors so at least people keeep their jobs.

TomPaine

 

[Yuwipi Woman]

If the workers were running the company, or at the very least had a major
core say in the direction of the company, I'd imagine years ago the workers
would have gradually come round to a decision to move the company towards
electric/hybrid/hydrogen cars.

I heard a fairly compelling argument the they should let them go into Chapter 11 so the employees can buy the companies.

 

[dilute micro]

They are producing better cars now than they were 10 years ago. The rate of manfacturing errors at Ford has been going down every year. Last I heard it was lower than Toyotas (Consumer Reports). I'm current driving one and I'm quite happy with it (other than the milage). They really need to work on fuel efficiency.

That's making better cars - not really the best they can. It's the same with light bulb makers. It's not in their interests to do their best. They need for us to keep buying and be stupid enough to do so.

 

[dilute micro]

Whether it deserves it or not, the consequences will be for ordinary people, people like my inlaws .

TomPaine

Don't think for one second that bailing out the auto industry is going to right our ship. There's far more than that running washington and our lives with it. Am I to believe the auto execs want this bailout with you and me in mind?

 

[goebfwai]

Brown was warning the US not to bail out the car manufacturers or resort to protectionism, as the result would be a knock on effect in Europe etc.
I don;t know what the answer is to be honest.

I would have thought the best route would be to nationalise the Big three and sell of the profitable bits to investors so at least people keeep their jobs.

TomPaine

This is the same Brown who has nationalised or part nationalised the banks! Why does he think only banks are entitled to a bail out, but not companies employing blue collar workers that actually produce tangible goods?

I heard a fairly compelling argument the they should let them go into Chapter 11 so the employees can buy the companies.

That might be an idea, but I don't think the workers should have to pay much though. Without the workers, there are no car companies, but if the companies don't survive, the workers will still live on.

 

[kyser_soze]

If the workers were running the company, or at the very least had a major
core say in the direction of the company, I'd imagine years ago the workers
would have gradually come round to a decision to move the company towards
electric/hybrid/hydrogen cars.

Why would they do this? I doubt you can find a single reason why a workers run car industry would be any more or less likely to have switched from doing what it knows to building hybrids. Wishful thinking.

You've also completely misunderstood how the bank thing works, again, but hey don't let that bother you.

 

[TomUS]

Right wing radio is screaming the auto bailout is a bailout of the unions. "Bust the unions " they say & slash pay & benefits. But over-paid workers is not the major problem I think. The right wing talkies make no mention of the pay of the execs & their bad decisions.

It's a difficult question. The psychological impact of the big 3 going chap 11 may push the recession into a depression. Some gov help with strings attached seems inevitable...but time is running out. GM claims they'll be out of cash by the end of the year.

 

[Idris2002]

Over-paid workers? Powerful unions? In America?

 

[nino_savatte]

Don't think for one second that bailing out the auto industry is going to right our ship. There's far more than that running washington and our lives with it. Am I to believe the auto execs want this bailout with you and me in mind?

The US has built up an enormous mountain of debt since the late 19th century. In fact, the US economy has relied heavily on debt for some time. It is the proverbial castle built on sand.

 

[RhymnRzn]

^I can think of a few other proverbs and parables, for what is safe and practical even for an industry; obey laws and limits, maintenance your vehicle: or watch the sparks fly.

If there be not the focus and emphasis placed on the necessary things only, to reduce the work week drastically, while affording everyone's basic requests and demands, to their liberty: then what is so great to return to forever? It is absurd that we do not live off of the old store for not only a year but two and three, before the yeild is abundant again, and we know our day is coming.

 

[Sunray]

There are times to go cap in hand to the US government and right now isn't one of them.

The administration is being changed so there is a 3 month power vacuum and they had a difficult enough time bailing out the banks.

I am starting to see that this may well be the beginnings of a depression. They have saved the banking system with tax payers money but really only at the last moment. I just read that ford is currently losing 1 billion dollar a month. How can just Ford be sustained even in the very short term without essentially wasting huge amounts of tax payers money building cars nobody can buy because nobody is lending money. Cheap credit is gone and will not be coming back.

Its not the companies fault really, they geared themselves up to supply cars to people when credit was readily available and now its not and it happened almost over night. These industries have very long supply chains and support huge numbers of workers, literally millions of people.

All I can see the Gov doing is becoming a bank and lending people money (who potentially can't pay it back) to buy cars?

 

[ViolentPanda]

Right wing radio is screaming the auto bailout is a bailout of the unions. "Bust the unions " they say & slash pay & benefits. But over-paid workers is not the major problem I think. The right wing talkies make no mention of the pay of the execs & their bad decisions.

Just like they never mention that GM, for example, started their own finance company because they didn't like the banks getting gravy they thought belonged to them!

It's a difficult question. The psychological impact of the big 3 going chap 11 may push the recession into a depression. Some gov help with strings attached seems inevitable...but time is running out. GM claims they'll be out of cash by the end of the year.

IMO the question is "what strings will be attached, and will the big three play ball?".

 

[Detroit City]

Just like they never mention that GM, for example, started their own finance company because they didn't like the banks getting gravy they thought belonged to them!

indeed, it is called GMAC (General Motors Acceptance Corp) and today they filed paperwork to become a bank holding company so that they can file with the US govt for some of the bailout money

 

[kyser_soze]

Its not the companies fault really,

Aside from diversifying into establishing their own, as opposed to bought in, debt financing, which really is their fault.

The thing that's really crippling the car industry isn't low demand, but that no one can get credit to buy new cars, in the US the size of the pension liabilities (which is what the bail outs seem to be aiming at relieving -split the pensions out of the firms and let them get on with building cars), and finally that their biggest customers, the fleets, aren't replacing cars at the frequency they were 12 months ago.

 

[kyser_soze]

indeed, it is called GMAC (General Motors Acceptance Corp) and today they filed paperwork to become a bank holding company so that they can file with the US govt for some of the bailout money

Traveller Corp (Amex) have done the same thing.

 

[ViolentPanda]

indeed, it is called GMAC (General Motors Acceptance Corp) and today they filed paperwork to become a bank holding company so that they can file with the US govt for some of the bailout money

Yep.
Not only have they fucked themselves with that, but they projected their sales based on the availability of the cheap credit they could provide, and are now left with (as are the other two major players) a huge acreage covered in unsold vehicles not just on the forecourts, but at the plants too.

What I want to know is what the fuck kind of idiots their CFOs were, didn't any of them read any histories of the auto industry or understand the mechanics of credit?

 

[kyser_soze]

They saw the words 'Shareholder Value' and thought they could make more money by bringing finance in-house, not realising that when half their customers defaulted, they'd be the ones holding the unpaid bills, not a bank or other finance company...

 

[Detroit City]

What I want to know is what the fuck kind of idiots their CFOs were, didn't any of them read any histories of the auto industry or understand the mechanics of credit?

the US auto industry is loaded with incompetents and nepotism and people who have no idea what the hell they are doing. there is no group consensus, everything is mandated by the top execs...

 

[ViolentPanda]

They saw the words 'Shareholder Value' and thought they could make more money by bringing finance in-house, not realising that when half their customers defaulted, they'd be the ones holding the unpaid bills, not a bank or other finance company...

Which makes it even more of a pity that it's the auto-plant workers and the dealership employees that are going to get it in the neck, rather than the feather-bedded MBA-wielders at the corporate HQ.

 

[elbows]

A couple of CNN articles which I found amusing.

Britain spending billions on its car industry failed (with fun quotes from Thatchers memoirs):

http://edition.cnn.com/2008/BUSINESS/11/20/auto.industry.uk/index.html?iref=werecommend

Big three CEOs flew on private jets to see the government and some gave them a hard time about it:

http://edition.cnn.com/2008/US/11/19/autos.ceo.jets/index.html?iref=mpstoryview

 

[dilute micro]

There are times to go cap in hand to the US government and right now isn't one of them.

But they are the government. Get a copy of War on the Middle Class. It's pretty good for showing just how blurred the lines are between representatives and lobbyists. Basically there is no line.

It is scary how corporate controlled our lives are - even down to what's in our food.