Auto Industry Bailout

The cost of subsidizing or bailing out should be compared with the cost of not bailing them out.

The strategic importance of the industry will also play a major role in the decision. Was the motor industry not converted to produce weapons in WWII?

In any case the decisions were taken by democratically elected governments with all the relevant information at hand .

What would America be like with only imported cars on showroom floors?

The industry should however also perform an in depth evaluation of their predicament and rectify shortcomings.

Comparing the US auto industry to the the one in Great Britian is like comparing a 53 Austin 30 to a 53 Cadillac. Or, try an ant to Godzilla. Their entire economy was not dependent on the perpitration of that industry, though I am sure it hurt when it folded.

I see the biggest problem with the US bailout is...so what if the automakers are able to stay in business and make more cars? If there is no one left to buy the cars, no matter how green, or how low priced, or how exciting, they are facing a very bad situation anyway. If the government can't fix the looming depression there will be no car buyers.

Hello emc c,

It is less than obvious that a government steering us into a recession/depression is what you also want at the helm of American business.

The government and their masters the federal reserve don't even seem to be hiding it, just refusing to talk about it. By the people for the who?

Ashamed of the greed

Brad

Quality; for the last 20 years, because the big 3 can't produce quality cars, in spite of repeating non-stop they are better. All they did was add more horse power (with low efficiency bigger engines, Cavalier have 4 HP more than Corolla, so what), futile accessories (any Cavalier had more gadgets than a of Cadillac 10-15 years ago), creating a false impression they were delivering value. They also had to drop the price to keep market share.

Maintenance; Big 3 reportedly have been losing money by selling cars. However they made money by servicing the cars! Pathetic..., should be the opposite. After leasing and paying to keep my car at the end of the lease, I really do not want to spend a penny on non-sense maintenance. Guess what do I drive?

Economic Shift; Japan has been leading the world on consumer products technology years before I decided to be an Engineer, however their economy did not grow for 10+ years. Who cares about Engineering, technology etc..., real successfully people are the Wall Street Gangsters, Russian Mafia, Republican happy club (Chenneys, war mongers, oil etc...). Keep selling insurance to each other, making burgers, live on credit, come back with that color code terrorist attack threat level, blame the Palestinians for the end of the American Dream...

Labor; for at least 75% of UAW/CAW workers, knowledge and attitude would not fit anywhere in the world. People that never had to learn anything. Seniority over performance, attitude. Cut the crosswords and do/learn something! Non-sense is the king! What does it make such people with low knowledge, skill and attitude entitled to earn so much? I know on the 1920's Unions were important etc... but I wasn't born then, neither my father or my grandfather. Why GM, Ford can compete and make money in most countries but no in the USA. It is like cancer.

http://info.detnews/video/index.cfm?id1189

Design; I am a foreigner, I could never understand what is the purpose of Buick's.

1 - Is it a license to make ugly cars?

2 - Is it a brand to sell to people over 65? Does it worth all the effort of targeting the group, as some people at 65 want to look younger.

3 - Is it to show that I could almost buy a Cadillac?

USA must face these facts or it will never get better...

Hello cwarner7_11:

are you ok?.........

My response is short. There should be no bailout in the automotive industry.

It effects hundreds of thousands. The recent bailout of the housing firms (which I am sorry but cannot recall the names) effected millions world wide. And is still doing so.

On the automotive front, they have bought up lots of smaller manufacturers and there is three or for conglomerates. The definition of when one of these huge conglomerates is not making a profit, and the degree to how much this will effect the workers is consequently large. But, it really effect those companies, who can get rid of the loss making areas, (as they do year by year anyway), and put more sensible thought into how many vehicles of a particular type and make they build. When more vehicles, more bread, more tulips, whatever the field, if there is more produced than is bought, the company/ are too big!.........End of story.

The same with the farmers........They did not get a handout when they decided to mechanise rather than use extra workers?...........

Either that or go the complete route of true communism. Where......(IN THEORY)..........everyone is equal..........eccept we all know this was never and will never be the case.

Take care and happy new year..............

Babybear-

If you study the British Leyland case, you will see the parallels to the current American automobile situation- low quality, consolidation, lack of true innovation, failure to meet market demand, overproduction, finally, a government bailout that ultimately failed. I believe the current attempt by the US government to bail out the American automobile industry is doomed to failure, because it supports "business as usual" rather than addressing the systemic problems of the industry. The president of GM made a comment a couple of months ago that "no car company can survive in a market with a demand of less than 10 million cars per year. Guess what? There is going to be a lower demand for cars for some time to come, because "demand" has been based on consumers trading their cars in long before they were worn out- a few years back, it was normal to trade in every three years, when a car should have a life expectancy of 10 years. The American market for cars will not increase as a function of the number of new drivers any time in the near future. As people struggle with the economic crisis, the importance of driving a new car every three years is going to be one of the first casualties.

The survival of the American automotive industry requires a complete paradigm switch, because the market has changed significantly since the heyday of the 1950's, and management must wake up to the new realities if they are to hope to survive...

Hello cwarner7_11:

What can I say, I think we are of one mind here! I agree totally.

Too many fat cat Managers getting even 'fatter' when their advice is to just build build, build! The designs are poorly engineered. And even the Cadillac, which should have been the US Rolls Royce, was shoddy, poorly engineered, badly made and designed. The US car and automotive industry should have slimmed down substantially more. something like 20 years ago. About when the buy-outs of smaller makers started. When there is the equivalent of a couple of 'airfields' used for parking NEW cars waiting for a buyer, then something needs shaking up real hard.

It is a shame because, as in the UK with Leyland, it is not the fat gits who are going to loose out. They can live from their 'share options' they will get whether the car companies make a profit or not, for the rest of their lives! As long as that is allowed to carry on, and it does so across the world, there will be no incentive to make changes for the better and to design and build an item that people want to get and are proud to own. That 'proud to own' ideal stopped as the small to medium sized makers were bought up, and the design ideas and ethos was said to be to expensive so that is when the 'grey' designs started to be authorised. With the only difference between 'makes', (as they were often built side by side), the only difference was the 'badge'! The engineering behind those badges was more or less identical.

I am waiting, and it will not be long now, for a substantial chunk of the European car makers to go a-se up. There is a lot of designs you can hardly tell apart. Ans when 'Jaguar' and 'Aston Martin' started to be built on the same floor pan, something has to fail as it is round the world. In the US and even in the far east, it is the same.

Hey, take care my friend. Happy new year OK?