Short term profits/shareholder profits have always driven US companies.The Japanese take the long view and where are they now in comparison?
The financials are bailed out to lend…lend that money to the auto makers.
Yes, some call it the "“Tyranny of the Quarterly Dividend and Quarterly Bonus”
OK, this is a bit lenghthy, but maybe worth reading and sending to your elected officials:
- Chrysler is NOT a public company. Cerberus Capital owns them. Let Cerberus invest more funds like they would do with other companies they own. No $ for Chrysler. The irony is quite rich: Nardelli, CEO of Chrysler, was CEO of Home Depot. During his tenure the stock plummeted and he walked away with a generous “parting gift”. Now he is back as CEO of another failing company and asking for our money!! Is there no shame anymore ? How about putting this guy is the stocks for a few hours every day so we can ask him for advice on running a business ?
OK- next- Cerberus owns 50% of GMAC. Their partner, GM. Do you see a pattern here ? They all drink the same Kool Aid!! GM- no $$, unless everyone VP and higher gets their walking papers. Maybe they could steal an exec from a auto company that makes money ? ( Imports ?)
Ford- they brought in a Boeing exec a year ago (He ran a profitable company!!) So, although I do NOT OWN a Ford my sense is to give this company a chance to continue down a path they are already own of their own volition!
The UAW- 100% partners in US auto failure. Just ask the pilots ( Who have a lot more responsibility) who have had their pensions taken over by the Feds and cut in half. Maybe the UAW could use some of its funds to help their own workers ? Just a thought.
All Done!
Brian
Not really sure how to post. I’m not responding to previous letter. I’d like to add my 2 cents. By way of another losing passion of mine, immigration reform; I’ll try to post part of a letter I sent to the Detroit Free Press to try and trick them into visiting my web site,stein for congress; or the yokel news. I hope you take the plunge as well and if you do turn up the volume on the yokel site. If this is a little unorthodox (shameless), well this is after all part of Tom and Rays enterprise, and who’s nuttier then them?Please take this slow. Everbody is in a rush including me. I was a candidate for congress in NJ’s 2nd district. I’m still on a Mexico and immigration reform crusade. I know the subject well, that would be Issue 28 if you open the attachment. I’ve loved Detroit cars since I was 10. I used to walk, or bike to dealership to dealership collecting the brochures. Right? They used to be within walking distance, that’s another story. I wrote what’s below for my web site www.steinforcongress.com but soon removed it because it was too preachy. It’s not that well written either but I think I’ve gotten better lately. Before I filed to run I hadn’t written anything for 30 years, and I knew craigs list on the computer; that was the extent of it, cars and motorcycles. I never e-mailed or had an e-mail adress before June.
If you went to above web site, the only reference to the Big Three that’s left is me saying I’d take over their health insurance liabilities and "call it the first step towards Universal Health Insurance."
Go to www.theyokelnews.com (put together the week before the election) and you’ll see some Detroit iron. I’ve never owned a foreign car except in 1985 when I sold a Honda Goldwing and used the money to buy a TR-6. Market penetration wasn’t on anybody’s mind back then, but you know what. Hollywood though was already doing its best to make foreign cars trendy back then. I’d like to think had they made the Rockford Files in the mid 80’s, my man James Garner would still have tooled around in a domestic car (maybe not a firebird). My brothers have never owned a foreign car. They’ve been subjected to the same bad press everyone else has. They could have taken the easy way out and bought a “reliable Toyota.” My father carries around shrapnel from the Iwo Jima battle. He bought foreign starting with a Dodge Colt, moved to a Subaru, and then 3 or 4 Honda accords. By that time I was bugging the hell out of him to buy American. We got to him in I think about 1997. He bought a one year old Mercury Grand Marqui with the touring suspension and dual exhaust. I helped him pick it out. After that was a Mercury Sable which he still drives in Florida at the typical retirement community. I’ve slowly watched the turnover of Grand Marquis to Toyota Camries etc. My fathers 7 year old car has 25000 miles on it. How many miles do these geezer’s put on the cars anyway that they’re worried about reliability? It’s all about being sheep.
Have the “tappet brothers” ever recomended a foreign car. No, partly because they know their listeners, like 90% of any NPR listeners, drive foreign cars and are damn proud of it. What does Diane Rheem drive? A Toyota. Thanks Diane, maybe my brothers should be driving a Toyota if Diane Rheem knows better. The 50% who still drive American have been carrying the water for the rest of us for a long time.
Consumer reports. Maybe they’ve come along a little bit. Where are they located? In Conneticut, a blue state. a snob state, where everybody who is hip and knows better drives a BMW etc. Who subscribes to it? Tree huggers. What do they drive? Foreign. Does Consumer Reports know how their bread is buttered? “You betcha” (That’s the only thing sarah Palin liked to say that was cute).
If this sounds crazy, and I have a feeling it doesn’t to you guys; think of the movie “Meet the Parents” Robert Deniro was portrayed as a right winger. What did they see fit to put him behind the wheel in? A Lincoln Continental. Everybody else, all the hip ones, I think where driving foreign. Multiply it 1000x, you know the math.
This is then what I wrote last June and still in my files. Don’t forget to check out my friends link on yokel news. I’m lost without him.
T each his own. I have a “foreign” car (Nissan Sentra) built in Smyrna, Tennessee, with very high US content. The Mercury Marquis and Ford Crown Vic have so much foreign (offshore) content in the that they are classified as “imports” for the purpose of calculating CAFE fuel economy.
We have had many posts before as to what is an American car. The Chevy Aveo (Korean) and Saturn Astra (German/Belgian) have 0% US content. The Pontiac G8 is entirely designed and built in Australia.
Great forum. G. Stein again. The Obama transition team has a blog, of course with this not being a government endeavor, this ones a lot simpler in every way. I bugged the editors of the Detroit Free press with this follow up- Assuming you read my earlier e-mail, can I add one more thought. Are these CEO?s girly men? Your one columnist talked about the 7 myths about Detroit. The one was especially dead on about the reliability issue. I didn’t have time to watch the hearings or see the nightly news coverage, but did even one of these CEO?s get aggressive and talk about the bad wrap they get? These pompous fools in Congress, who are sitting in judgment, have run up deficits for years, and have bloated staffs, which qualify as a “jobs bank” in my book. One of these CEO’s should have fought back and been a hero; and reaped either the reward or abuse. A stand up congressman might have defended him.
I didn’t spend much time proof reading, I’m in a big hurry these days on my other fools errand (immigration reform). If you ever decided to quote from or print (I have low expectations anymore) parts of letter, one word from line in the letter should be changed from, “what” to “that”; But you know that.
Am I making a lot of people nervous? Good. I?m going to quit this crusade soon, the fires are already dieing, so I?m typing up a storm in a big hurry now
Anything can happen when I get on a computer. I thought my reply would get posted. I’ll try again. I was saying todocnick that it always reverts back to these technicalities of %'s. Does he not consider the Big Three as domestics? The content he’s referring to I think comes from Canada or Mexico. That’s a lot different then coming from anywhere else. The stories of Japan closing their markets to our domestics go back 25 years. I just returned from a fourth trip to Mexico, and small Chevy’s and Ford’s look like they’re winning the market battle down there.
I’m all for letting the “big 3” flailing on their own. Let them do a deal with the Oil Companies, and they can get their creative juices flowing on how to save their own butts.
Either that or nationalise, combine and streamline all three of them.
I heard the end of your show today, December 7, 2008 on UALR in Little Rock, saying that there was a lot to discuss about the Big 3 and what to do. I wish to invite the Car Talk Community to read a couple of posts on my diary on DailyKos and take the poll with the following question:
http://www.dailykos.com/user/PeaceVet
What should the USA do about the Big 3?
Bridge loans for all of the Big 3?
13% 7 votes
Bridge loans only for Ford and Chrysler?
0% 0 votes
Nationalize GM?
15% 8 votes
Nationalize all of the Big 3?
47% 24 votes
Let the Big 3 sink or float on their own?
23% 12 votes
| 51 votes | Results
Last Sunday I posted, my last post, about ?Bailout the Automotive Industry? GM?? and why I thought the USA governmnet should buy 51% of the GM stock and put a green Board of Directors in place. Our local paper ran an editorial by Dan Neil of the Los Angeles Times that supported that same solution for GM.
He did not have the same reflection on the history of GM?s fight to distroy urban public rail transportation and killing the electric car that I have, but he comes to the same conclusion? nationalize GM.
http://www.dailykos.com/user/PeaceVet
Here?s a plan: Buy GM
BY DAN NEIL LOS ANGELES TIMES
It takes me on average two tries to get one post. I was saying that I’m even more of an admirer of Tom and Ray now because I see above that the dailykos of all things got the OK(?) to put web adress in. I was Gary Stein the fighting janitor who was secretly jealous of all the publicity for “Joe the Plumber” and you can visit me at www.theyokelnews.com I’m going to past this one and save myself trouble of re-typing if it doesn’t post. I forgot, I also added that I love Detroit cars.
Gary; I just returned from a trip to Brazil, and, yes the GM and Ford cars are selling well there too, and are locally modified built German and British models. I’m not against extending loans to get the Detroit 3 back on their feet; I just would not do it for sentimental reasons because they are domestic. Opel, Germany’s GM division is appealing to the German governemnt for help. GM,Ford, and Chryler in Canada are asking $6.8 billion for the Canadian government. The Canadian government will extend loans as long as the jobs don’t go South to Mexico or the US, or overseas.
Canadians generally don’t care who builds their cars as long as there are proportionately enough jobs in the industry. As a result of NAFTA, 26% of American cars and trucks sold in the US are built in Canada. Ontario builds more vehicles than Michigan.
If you ever visit Japan, you will realize that US cars just don’t fit on their roads and streets. Prized US products there are Levi jeans, Harley Davidson motorcycles (the ultimate status symbol), Spalding golf clubs, but not many mainstream consumer goods.
At the same time Japan Airlines owns the most Boeing 747 jumbo jets, all made in Seattle.
On a previous post we bemoaned the fact that the US was losing its lead in DESIGNING leading edge motor vehicles. That has nothing to do with labor rates and unions; it is strictly a management and leadership issue. This is what is bothering members of congress. In aerospace, for instance the US is still a world leader.
Docnick, wow, I bow to your expertise. I’m not saying that sarcastically. And if you go to my web adress www.theyokelnews.com you’ll see that’s a real compliment. You know what bothers me? We’ve been losing industry after industry for years and the big three have been down sizing for years, so this Detroit mess has brewing for a long time. What bothers me are the very financially well off who, we’re saying it slowly, for FASHION reasons, and to impress the neighbors, buy an expensive foreign car. They don’t ever have to really worry about reliability. Given the pain this mess is wringing now, and has for last several years, would it have been so embarassing to buy a Lincoln or a Cadillac? Do they ever stop and think who the ones are, driving the Cadillac’s or Lincoln’s? Are they the stupid ones who never turned on a TV and heard about reliability and re-sale value? I don’t know many rich people but I bet quite a few bought them to keep Detroit alive and humming. How about civil servants? It could be argued that they are in the same lucky position the UAW was in 30 years ago. Their wages are high compared to the rest of us now, and they have??? guaranteed jobs. But what, all of a sudden even their jobs may not be so secure afterall i.e, California for starters. There’s a per centage, I’d say a fair per centage of these union workers who buy foreign and don’t see the irony. There is one way out of this mess after Detroit gets the loans, and it’s how we can be sure the loans are repaid. Starting with, I’ll pick a name, Britney Spears, next time you fall off the wagon, I want to read about you banging up a Cadillac instead of a Mercedes.
Yeah boys, we gotta bail Detroit out. I hate it, but we gotta do it.
HOWEVER!
I have started a movement called “NO NEW CARS!” which asks people to sign a petition pledging they will not buy a NEW car until Detroit manufactures genuine alternative fuel autos and light trucks.
Let’s face it, there’s a million used cars in great condition on the market. By buying a used vehicle we will diminish the current surplus of used vehicles and make
the purchase of a used car affordable for the buyer - maybe even cheap enough to get a small bank loan for a car or no loan at all!
In the meantime, the message to Detroit will be clear: we will not buy your crappy overpriced gas guzzling pieces of junk anymore. Come up with alternative fuel vehicles now or kiss Auto-Buying-America good-bye (we’ll be driving away in a foreign job no doubt).
But what about T. Boone Pickens’ idea? What about going to propane in the meantime until electric or whatever the next clean available fuel might be comes on the market? What about it I ask you?
US automakers face a competitive disadvantage compared to their rivals who enjoy government provided health care and schooling. Their rivals also enjoy younger employers with low levels of retirement here in the US.
So even with the same income levels US manufacturers could not level the playing field.
Foreign automakers have been nudged in the right direction by governmental regulations requiring cleaner, safer and more fuel efficient vehicles. They have seen the requirements edge up little by little year after year. Putting their industries on a course to succeed.
The US government however failed to enact smart policy’s like above. Instead after doing nothing for decades the CAFE rules now require a drastic change that destroys product plans costing the locals a fortune, because a vehicle platform, which is typically used for three product cycles (everything under the skin) can now be thrown out including all tooling and assembly equipment.
By the way CAFE legislation has not caused drivers to buy smaller cars, so far only energy crisis’ managed to do that. Back in the late '80’s Chrysler almost went out of business making only small fuel efficient cars. This tells me CAFE legislation has utterly failed.
If Americans want to keep their automakers than they’d better find out what others are doing because a country like Germany shouldn’t have any automakers left if you apply the logic used here (high wages and good benefits).
Please put on your thinking hats (or start a business selling Caddy’s to the Chinese and bicycles to Americans).
Neil.
PS I didn’t even mention the currency manipulation or skewed import regulations keeping US products out of many foreign country’s.
I was a sales manager for 25 yrs. and I say NO!! because they made their own trouble with charging the dealers to much and building more than they needed. Cut the exec. salaries, build less cars keep demand high and give the buyer a reason to buy. Structure like the imports and we will win.
I work hard for my money and pay a lot of it in taxes. I need the best value for what little is left after the Feds and State are done with my paycheck.
If Detroit can deliver value, I’ll buy their product. If not, I won’t. It is as simple as that.
The minute the government steps in to influence that basic decision, they’ve stopped being government, and have become servants of an industry. Some might call them hostages. It’s fundamentally wrong, and not their function. Anyone claiming otherwise does not understand free enterprise, much less free markets.
Besides, does no one remember the fiasco of the British car industry? Those pathetic piles of junk cost the UK taxpayers dearly before they died an agonizing death. Governmental life support didn’t save them, but picked the pockets of British taxpayers for several years, and billions of wasted money. We won’t even consider eastern European cars.
Do we really want the US car industry to be remembered for the equivalent of the MGB, Morris Minor, or heaven forbid, the Trabant? Have we no pride left?
We’re already broke as a country, and have now mortgaged our children to the tune of perhaps $100k each. We need to stop throwing good (and borrowed) money after bad. Now.
I don’t support granting a loan to the big 3 in their current state. That would just be throwing good money after bad, as other people have said. You would have to have been living under a rock to not be aware of the fact that these companies have not been doing well for the past 10+ years (we have all known that American made cars are not as good as foreign made cars - and that’s been the case for some time). That did not, however, prevent the companies’ CEO’s from having access to private jets to fly to Washington to ask for taxpayer-funded loans. I would only be in favor of loans if the companies were completely over-hauled, with new management.
I have a question for the group - about 2 to 3 weeks ago I was listening to a show on NPR one afternoon. One of the journalists said that one or more of the big 3 has stated that employees who earn $200,000 or more would not receive a bonus. I’m not familiar with their pay structure - does anyone know if the companies in fact were to receive loans would those earning $75,000, $100,000, $125,000, $150,000 or $175,000 would receive a bonus? If that’s the case that’s wrong. Shouldn’t bonuses be tied to a company’s performance? If anyone receives a bonus, that would be thanks in part to taxpayer money. If they receive loans and one or more of the companies were to fail that money would not be repaid. That is wrong.
Spike, I like your idea about offering a tax break for those buying more efficient cars. I also agree with your comparing the potential loans to farm subsidies - I think that’s spot on.
Thanks Gary; I have owned US cars since I bought my first one in 1958 as a student. I sold my last one in 2007, a big Chevy. Like many of us, I tried to keep buying “local” cars, but when the fuel prices started going up there was just nothing available but non-US cars that were durable, reliable and would last the 15 years I keep my cars. Right now we own a Nissan and a Toyota. When the time comes to replace my wife’s car, it will likely be a Honda Fit or a redesigned Toyota Yaris. The Korean Chevy Aveo is cute but not durable enough.
I cannot in good conscience recommend a US car to my friends and relatives, unless they want a pickup truck or now a mid size Fusion or Malibu. If I lived in Germany I would be quite happy to drive a Ford Mondeo or GM Opel Astra.
Congress has decided that Chrysler cannot survive on its own and will be encouraged to merge with Ford or GM, or be sold to a foreign firm, such as Tata, who would love to have the Jeep brand. None of the other products are worth buying.
This crisis will finally wake up the industry and hopefully cause a much needed restructuring where at least two can survive. The CEO of GM has to go, however, as many now agree. Ford’s Mulally has the right stuff fo ressurecting Ford.
You make a lot of good points. During my lame run for congress last fall; stein for congress on internet; I always gave somebody who said something I agreed with, and said it better then I could, a handshake, and said they were proving a minor point of mine; that I’m nothing special (I’m a fri**in office cleaner after all) and there’s a lot of us (not all, oh boy!)who would do just fine seated in Congress. Back to your letter and point about Germany. Did they (Japan also) have the luxury of starting almost from scratch after the war, and building up slowly? I think the the Big 3 are paying a price now, for an almost exclusive market here in the 50’s,and 60’s (building large cars we wanted), SIMILAR to just about every other great manufacturing industry of ours that had advantages in those decades, and long ago went out of business. The Big 3 survived. And back again to your point about Germany. Are people there more likely to buy the national brand? I don’t know. I know WE pride ourselves at wanting a million choices to choose from and 30 years ago some people just loved being the first oddball on block to have the weird foreign car in their driveway.
Decisions were made at the time that really couldn’t have been made any different, given where we were at as a country at that time. Call back from the grave the CEO’s of all those industries, steel, shoes, tires, electronics, airlines; and sit them before congress and ask them why they were so stupid. No, they weren’t all stupid, unless all the Ivy League schools taught them to be stupid. Put those professors too on trial, that turned out those CEO’s. Put me on the hot seat, ask me why I wasn’t smart enough 30 years ago to get a low paying civil service job and know ahead of time, that in 2008, it would be a high paying job with a guaranteed pension, health care (oh! could my spouse use some decent benefits now) and early retirement. Are civil servants ready for same abuse the UAW is getting now.
Are people saying the Big 3 could have played real hard ball with the UAW even 2 or 3 years ago. Get real. Could the UAW president have asked his members years ago to give back then like they’re going to now, and not have been thrown out in the street? Will Congress fix Social Security next year by raising the retirement age?
What’s that expression about how may angels can you fit on a pinhead? (am I a pin head?) This could go on and on and on. It had to play out this way, we didn’t have to go to war with Iraq (which I supported). A decision that was made in a few weeks time vs. a problem that has been in the making in slow motion for decades. I saw the head of the UAW, Ron Headilfinger, (I can’t spell), on the Today show this morning while I was wrapping up one account (cleaning). Meredith Vieira was asking tough questions. He’s no “girly man” like I think the Big 3 CEO’s might have been last week. He gets it and he gave the business back at her, mentioning closed markets in Korea for one thing.
But where is this arguing going to get us. If they go bankrupt nobody will buy their cars. People are too nervous. Go try and get people to sign a petition so that you can run for Congress. Not so easy. People think the Congressman will seek revenge on them. No one will buy the cars if they go bankrupt, unless we want to buy Chevy’s built by Toyota. Give them the loans and rich people, union people(every school teacher, policeman and fireman that want another and another raise and retirement at 20 years, at least here in the north-east where pay is excellent), buy a Big 3 car when your ready for a new ride, and chances are that the nudge in market share will mean the loans will be re-paid.
If you looked at any of my other entries, even the first 3 un-readable paragraphs of my first entry, you’d know I ran for Congress. I was an unheralded independent. I have a silly, (maybe not) site on web called The Yokel News. I’m going to do an issue 27, I think that’s what I’m up to, and prominently feature my Ford Areostar with 227,000 miles on it. My good friend Don, just had his wife’s new Subaru in for a replacement transmission. Since he knows cars well ((he fixed them for 30 years, (and Tom and Ray would love him, he’s the funniest guy I ever met))he knew that Toyota was giving, I forget exactly, something like 200% over blue book if you were aware in the first place, and knew enough to bring back to the dealer rusted out Toyota Tundras with bad frames. Another friend I knew, dead for about 3 years thanks to the stresses of the car business, used to tell me about bad tranmissions in certain Lexus cars. I’ve had problems with the transmission in a Town Car. Don and I put another in it from a junker I bought. Find a cheap replacement for a foreign car. Don also loves Aerostars. You can’t kill them.
They all have problems but it’s great fun to kick the Big 3.