AND 
Poll: Should the US Government Give Emergency Loans to GM, or Let Them Fail?
It is very clear that within weeks to months, absent any government help, GM will fail.
With that failure so will go hundreds of thousands if not millions of jobs, and hundreds of billions of US revenue. It will likely cascade to many related industries.
As well, our soonest opportunity to begin to get off petroleum, the Chevy Volt’s future, will hang in the balance. Even if the Volt property can be saved and liquidated, there are certain to be delays into production, and no guarantees of it ever making it there.
Furthermore, some experts argue that a Chapter 11 re-organization wouldn’t be possible in the current illiquid environment.
We here are a unique group, we follow the Volt because we want to displace petroleum, and a dozen other reasons. Surely there are a variety of political social and environmental opinions.
With the upcoming Congressional vote likely to be next week, the imperative question for us is, should the US government grant GM’s request for financial aid? There would likely be strings attached, and you might consider what some of those should be.
We are a large and important group, and based on the results of this poll and my input, we can make our opinion known at the national level in letter form and perhaps have some influence in GM’s fate.
We did after all influence the decision to move the Volt into production.
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November 13th, 2008 at 10:48 am
Voted yes with conditions. Maybe a change in management. The Volt is still priority 1.
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November 13th, 2008 at 10:52 am
There most definately has to be conditions. It would be like giving a child $20 and not telling them that they have to use it for lunch money. They would head stright for the candy store instead. The conditions must be in place to prevent GM from heading stright to the candy store!
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November 13th, 2008 at 10:52 am
I want the Volt as much as anyone, but the only way for GM to restructure their union contracts to be more in line with the “foreign” automakers building here in the US is under the cover of chapter 11.
Chapter 11 doesn’t mean that they have to stop all work and fire everyone. It just allows restructuring.
Only that would allow long term competativeness.
Perhaps loans could be made available to get through the restructuring and afterwards.
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November 13th, 2008 at 10:52 am
This first round should be lightly conditioned
- preferred, non-voting stock for the government
- salary / bonus caps for execs
- development / retooling for more efficient or alternative fuel vehicles
If GM needs more help later on, then an arbitrator needs to step in, tear up the union contracts, sell off non-essential chunks of GM and set up the company like the domestic versions of Toyota and Honda.
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November 13th, 2008 at 10:56 am
Yes, with the condition that the union contracts be re-negotiated into something reflecting todays economic realities.
This should be an American auto industry bailout plan, not a UAW bailout plan.
Once profitable, the bailout LOANS should be repaid to the American taxpayers.
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November 13th, 2008 at 11:00 am
#5
i will be waiting for my check.
I would only hope that if this does go through that NO BONUSES are given at all. Why would you give bonuses to people that caused a company to go into bankruptcy? That money needs to go into development, research, and pay for the working class to get the vehicles on the road. But along with that, we as a nation need to receive the credit from the banks to be allowed to purchase the vehicles.
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November 13th, 2008 at 11:00 am
Defeintly yes with conditions. GM cannot fail because of a large amount of job loses, but if the US goverment is going to give GM
( a now global company) money to keep them going then the factories and jobs sent to other countries should come back to the United States…..
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November 13th, 2008 at 11:02 am
Yes, with conditions. As a taxpayer and now an investor of GM, I will expect dividends. This will be the chance for the Federal Government to finally push through a comprehensive health care plan that take the cost out of the market place. The Unions will also have to step up to the plate and act like investors too.
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November 13th, 2008 at 11:11 am
Hey! You did the poll! Good on you, thanks Lyle. You are reading the comments all the way down, good to know…I’ll remember to not anything bad about you when they get long in the tooth (just kidding).
/I knew we could go 5 threads in a row!
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November 13th, 2008 at 11:13 am
As much as I want the Volt to be made, I have to vote No. Every company we bail out, we move closer to socialism. This is the way the free market economy works. If GM, Ford and Chrysler go under, it will leave a market void that will be filled with start up companies that make cars that Americans actually want. If the big 3 had listened to buyers in the first place they wouldn’t be in this situation.
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November 13th, 2008 at 11:13 am
There is a building consensus that the auto industry needs to be helped and that the model should be similar to Chrysler in the 70s. Postesda and his Think Tank have come up with this and it’s gaining wide support (see the NPR piece cited by Rashiid in the last thread).
Bankruptcy would be somewhat similar but more problematic for a number of reasons including problems for suppliers (if you don’t pay the suppliers they go broke) and consumer resistance (people won’t want to buy a car from a company in bankruptcy).
This may result in one or more mergers and pay cuts, which will not make the unions happy, as well as management shake-ups, which won’t sit well with management, but such is life.
Bush will sign on in return for the Columbia Trade Agreement. That’s seems to be a sealed deal, which is why everyone was so anxious to say it wasn’t the case.
In my mind those saying that GM should fail — as opposed to those who say Chapter 11 is an alternative, which is reasoned — are just boneheads, particularly with the recent employment figures. It’s like saying you want everyone in the army to be killed and the country to fall because the generals have done a bad job.
In this regard I reserve most of my contempt for those Republicans whose slavish devotion to the “free market” created the mess we’re in, and whose only contribution at the moment is to bitterly denounce “taxpayer bailouts”. They don’t seem to get that if the current trend continues there are going to be fewer and fewer taxpayers to worry about.
I also will point out that whoever — I can’t remember now who it was — who blamed Barney Frank for the financial mess is so totally and impossibly delusional and uninformed that it’s simply sad. Whatever you can say about Frank, he was one of the few who wanted regulations for the credit swaps which are really at the heart of the problem. (Maybe it’s just homophobia run wild).
On the other hand, Democrat Dingell and the rest of the Michigan delegation deserve to be booted for their role in enabling the US auto makers to use political gimmicks to avoid the actual restructuring that needed to be done. Hopefully at the least Dingell will lose his Chairmanship. Newt Gingrich and Jesse Helms were of course co-conspirators but one is gone and one is dead so no need to do anything on their accounts.
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November 13th, 2008 at 11:16 am
This web site used to be fun to visit. Just like every other blogging web site, it’s turned into a discussion about the economy. I don’t know what to think anymore! Maybe GM should file Chapter 11, and then get the government loans to restucture??? I don’t think that Joe Average or I are qualified to make a judgement for something that he does not fully understand the implications of.
Something has to change in America, though. I feel that the author of the following web site usually rants for the sake of ranting, but lately his stories have a bunch of truths about why America should give its head a shake:
http://www.autoextremist.com/
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November 13th, 2008 at 11:20 am
I have a large balloon payment on my beautiful Hummer H2 coming due next month.
Where is my Emergency Bailout ???
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November 13th, 2008 at 11:21 am
Reduce top management salaries and bonus program to 10 X the average salary of the hourly employees.
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November 13th, 2008 at 11:24 am
I voted yes with conditions even though my mouse hand really wanted to vote no. With the right conditions I’m confident we can teach the auto industry a proper lesson without them thinking oh we can always ask the government for help. If it’s done right (200 Billion Dollar if) we can save hundreds of thousands of US Jobs.
WHAT HAPPENS TO OUR CAPITALIST SOCIETY WHEN ALL OF THOSE NEWLY UNEMPLOYED FILE FOR UNEMPLOYMENT??? THEN WE JUST BAIL OUT THE INDIVIDUAL WITH NO JOB.
That to me is why we need to save the industry if we can. Because in the end we’ll end up paying for it. Why not make people work for their handouts.
1 million lost jobs X $1500 a week for unemployment = $1.5 Billion a week in unemployment + Medical expenses + Forclosure effects on the economy.
The more I write about this the worse voting no looks to me.
Statik, what CONDITIONS would you put in if it were your money bailing out the big 2.8? I’m assuming you voted NO, but just curious what the best of a bad situation could be.
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November 13th, 2008 at 11:25 am
Jason #4,
OK Jason, I agree with you however I am inclined to propose a modification of your third condition :
– development / retooling AND PRODUCTION in less than 18 months of more efficient or alternative fuel vehicles
JC
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November 13th, 2008 at 11:35 am
My Fear would be that big oil buys the Volt intellectual rights..By by Volt.
Save them in a LOAN with conditions. primarily that pay is limited, no bonuses, and NO goplden parachutes until repayment / profitability restored.
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November 13th, 2008 at 11:36 am
I agree with your analysis regarding attaching Strings to a Federal Auto Bailout, but we need to take it one step further, by requiring GM and other Auto companies availing themselves of the bailout, that they must start retrofitting the existing auto fleet to lithium battery technology such as that offered by AFS Trinity.
The various auto dealerships need to be required to open 2-4 of their service bays solely to retrofitting, using their financing arms such as GMAC, (nearly bankrupted from sub-prime lending) to do $10k retrofits, with an additional $3k tax credit to the auto owners and finance the monthly payment to $100/mo, giving everyone a net $100-$200/mo saving or stimulus, generated from foreign petro dollars.
This approach, will create a vast new business opportunity for GM, based on the 240 million current auto fleet available for retrofit, that will allow GM some realistic hope of survival and ultimate repayment of tax dollars, creating massive numbers of new jobs, new battery plants, for the US to compete with new Asian investment technology. As well it will get us to our environmental goals much faster and restore auto asset, devaluation that has occurred in the US due to high fuel prices and the financial meltdown.
To achieve these goals it will require a much greater energy investment than what Barrack campaigned on, to the tune of a Minimum of $500 Billion in five years, in a WWll like effort. But the shift of the $700 billion in foreign oil expenditures to US investment in jobs coupled with the multiplier effect of the foreign petro dollar, infusion in our own economy will create a multi-trillion $ annual effect on our economy.
I know a lot of great minds are looking at solutions, but I am not sure how much thought is being given to retrofit of our current auto fleet. The 16 years it would take to turnover our new car fleet (under optimum conditions) is unacceptable, given global warming and the magnitude of our financial problems.
We need to be thinking of our WWll conversion of our peace time industrial base to a war time industrial base as the model to solve our interconnected problems. A WAR ON OIL!! The security implications are just icing on the cake.
I am not sure of your ability to influence policy, but I offer these humble thoughts for your consideration.
Thank You
Tim Gordon
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November 13th, 2008 at 11:39 am
I voted for yes with conditions. Loans should always include conditions. The history of loans to the auto industry in this country has shown that it can work out positively. I believe that it is worthwhile and that the causes for Detroit’s down fall is way more complex and beyond the fact that they didn’t build a Prius. I believe that it is an important industry for our country. There is some blame to be placed at management, but even more to be placed at the foot of the UAW. So yeah, there needs to be conditions on the loan.
What people don’t seem to get is, our automakers are being asked to compete against the Japanese who’s government ALWAYS subsidizes their auto industry on a regular basis and takes care of their work forces pension and health and welfare. So a little loan every 28 years or so is not so much to ask.
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November 13th, 2008 at 11:41 am
I voted no. GM has an operating margin and a strong business case. they are stuck in legacy costs that others don’t have. bankruptcy will let them shed the same. i would not mind if congress picks the tab for re-training those in michigan.
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November 13th, 2008 at 11:43 am
GM needs to shed capacity quickly to size the company for the existing and foreseeable market conditions. One of the obstacles is the UAW. Even if GM closes a plant, they have to pay workers their full time wages even if they are idle. And layoffs require a tremendous amount of negotiation. Any bailout from the U.S. taxpayer should involve helping GM ‘right-size’ the company. Any money spent to maintain a bloated company in a shrinking market will only set-up GM and the taxpayer for another bailout in the future.
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November 13th, 2008 at 11:47 am
My 2 cents.
I voted yes with conditions. (Since I’m not a US citizen, it’s not my money anyways.)
But still I find it uncomfortable that the US get so much in debt that the country itself may go bankrupt this way. (Who dos the us gov borrow the money from for all this?)
In all cases the US gov should be able to ask (and receive) whatever they want from their automakers after this.
What I think GM et al need is guarantee…
For example to allow anybody to buy a vehicle one would need to borrow. If gov temporarly and partially garantee that money borrow it would be easier to have people start to buy vehicles again. Issue here is that cannot target only local automakers (fair trade issues).
The could condition having the car built in North America.
An other one is with the portfolio, GM/FORD/Chrysler should be required to have at least a good percentage (lets say 50%) of their portfolio to be a low budget cars/trucks. This that people need to buy even during financial crisis. (no one really cuts down to nothing, most are cutting bells and whistles and just buy more pragmatically)
the simple fact of letting a company bear the retiree regime don’t make sense either. Instead you force those company to keep their workers learning while they are working for them and have their pension plan converted to 401k (not sure here it RRSP’s)… Once an employee’s position is cut (can be technology or financial change) he still has good knowledge and skills that can be used in other potential industries.
Oh and also: NPNS for all…
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November 13th, 2008 at 11:47 am
I vote yes with “condition”.
The only condition is simple. In the interest of saving our republic, OUR automakers must get us to zero import of foreign oil…period!
Carl Covey
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November 13th, 2008 at 11:47 am
The thought of 2.5 million additional layoffs on top of the 1.2 million already out of work is difficult to imagine. I fear a tipping point were the demise of one or two or all our domestic auto makers would snowball into a much larger employment catastrophe. The auto makers and suppliers, please don’t forget them, are the last large manufacturing entity remaining in this country!
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November 13th, 2008 at 11:49 am
My vote is NO
We taxpayers have been dragged into the business of going out of business.
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The already approved $7500 automobile tax credit is more than enough for any half-well managed company to prosper.
Exxon station pump gas will soon cost $2 a gallon. The GMC/GM/Chevy dealer inventory of Suburban, Envoy, Tahoe, and other large vehicles will again be attractive to snow country and working ranch buyers. This equals unforeseen income for GM.
GM’s competition is just as weak as GM is …
1>The new line of Toyota’s simply look bad. And these have become boring to the public.
2>Nissan had reported very slow sales last quarter.
3>Honda is in a semi panic because 90% of their profit comes from the freeways of America. Honda doesn’t do well in Japan.
4>Ford is bragging about a 24 mpg SUV. Need I say more?
5>Except for Jeep, we can forget about Chrysler.
6>Many of the smaller European cars have been priced North of $30,000, bad timing for this.
So my vote is NO to bail outs for anyone. This includes Comp USA, May Company, Wynn Resorts, and Starbucks.
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The auto manufactures of the world are very aware of how to build an EREV. The current economic conditions DEMAND that at least two or three manufactures take their shot at producing a Volt-like production car.
Look what this kid from Texas was able to do…
http://www.zoomilife.com/2008/10/17/texas-teenager-builds-his-own-electr
=D~
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November 13th, 2008 at 11:59 am
Ah lovely, another flawed poll by Lyle… flawed because the premise is flawed… give them loans “or let them fail”. Letting them restructure under chapter 11 (bankruptcy laws) is NOT “failure” and does NOT mean the loss of millions of jobs as Lyle implies.
What Lyle also fails to mention is that if you give the auto companies the loans, then we may very well be obligated to do the same for every other industry…. airlines, trucking, railroads, high tech, … where does it end? How much money can we “print”?
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November 13th, 2008 at 12:01 pm
Chrysler’s bailout resulted in a half million dollar return on the US government’s investment. It had conditions attached (see NPR’s reporting on it: http://www.npr.org/templates/story/story.php?storyId=96922222).
The auto industry supports a rich ecosystem of jobs. A bankrupt GM would not be a good thing for the country.
StephenB
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November 13th, 2008 at 12:05 pm
I’m just reading my delayed copy of EV World Insider… interesting piece of data (when GM was still trading at $4.75)…
Jim Dunn sent me (Bill of EV World) an article last week that GM’s market capitalization now stands at $2.69 billion. ….
The day after the 1929 stock market crash, the company was worth seven times as much in inflation-adjusted dollars, according to market historian Bryan Taylor of Global Financial Data.
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November 13th, 2008 at 12:05 pm
I really find this topic very interesting. First off I don’t believe its because of labor that GM is hurting. I believe its because of terrible management.
Having said that what I find interesting is the fact that GM spent so much time and energy fighting the development of alternative fuels and being buddy buddy with the Bush Administration. Now they are no longer buddy buddy with Bush and he has stated they should fail because of their lack of alternatives. GM has no good products to sell right now. If I want a hybrid car, I’d have to be really stupid to think GM’s offers are really a great deal. If I want a big SUV hybird yes they have the best options, however barely anyone is in that market right now. I’ve been a GM fan for a long time so when I say this its pretty sad. I believe the U.S. needs to maintain an Auto Industry however due to their bad management decisions and the fact that “NO CHANGE” has occured in upper management, I belive they should be left to fail. I guess I should now hope for a Ford Volt. We will see what happens.
No Plug = No Sale!
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November 13th, 2008 at 12:06 pm
Ya right! a hobby car for the masses….. give me a break! If GM will not make it through 2009 or maybe into 2009 if something is not done. What do you drive by the way….
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November 13th, 2008 at 12:11 pm
We’re right back to the Bush Oilmen contributing to the failure of the EV’s of 1996-2003. He is the worst president ever and I am a Republican.
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November 13th, 2008 at 12:11 pm
Bottom line: Is GM is too big to fail…?
it is a tough pill to be forced down our throats…I mean swallow…
Question I ask is…what is the benefit of providing life support to the largest producer of non-competitive autos?
I think its a DEEP rabbit hole if there are not only conditions but flat out mandates on how the money gets used.
I thought I read somewhere that GM is estimated to be the second largest provider of health care benefits and that if they failed, upwards of 2.5 million jobs would lost.
It is my opinion that the retiree costs and health care costs should NOT be the reason to keep the big “2.8″ (thx Statik) bumbling companies alive. Rather, hack off the costs associated with retired lives and health benefits and let the government absorb the costs somewhere on its budget.
We need to stop companies from producing inferior products (sans the Volt of course) and creating more underfunded liabilities. At least with this scenario, we the taxpayers would be able to see the end to our role in supporting a failed industry.
The US economy would receive a huge lift if the 2.5 million people associated with auto production were retrained and retooled. This would certainly take time but wouldn’t the benefits be greater if the US government spent $25-$75 billion to train engineers, support infrastructure projects, and most importantly work in the much neglected alternative energy space?
Wind farm projects have been halted in recent weeks because of the collapse in oil prices. The price of oil SHOULD have little impact on the need to explore the benefits of alternative energy sources. As someone who has a longer than average commute, I would have NO problem if additional taxes were added to gasoline as long as those dollars could be earmarked for the above conditions.
We taxpayers have had little to say about where and how the bailout
money would be used. We now know that non-banks can apply for bank status and gain access to unlimited liquidity from the Fed. Why can’t we as taxpayers apply for bank status to gain precious liquidity from the Fed, when the banks are refusing to lend to those that ultimately fund them—the taxpayer?
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November 13th, 2008 at 12:13 pm
#11 DonC:
I heard the NPR piece too. The guy interviewed was a law professor from U. of Illinois specializing in bankruptcy, if memory serves. Sounded a lot like Statik, LOL.
When asked why top executives are so adamant about not declaring C11 he said that many times they lose their jobs. No s**t!
He also said that they have seen this coming for several years and have not been able to fix it, so why should anyone think that the “breathing space” allowed by C11 would produce any better results.
Even so, I voted yes with conditions.
#18 Tim:
Thanks. That is the level of thinking we need to turn this whole mess around. I love the idea of retrofits, although I have no real sense of how they would work exactly. The Poulsen thing would appear to have some promise. I would think that some variation of that could be brought to market fairly quickly, given the resources of the US government.
We spend close to $1 TRILLION on our military each year. The whole military procurement system is a form of advanced corporate welfare and socialism, IMHO. Energy independence is a huge national security issue, so diverting some percentage of the flood of “defense” cash to something like what Tim has proposed would seem entirely appropriate to me.
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November 13th, 2008 at 12:14 pm
#15 Gsned57
Statik, what CONDITIONS would you put in if it were your money bailing out the big 2.8? I’m assuming you voted NO, but just curious what the best of a bad situation could be.
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What? Me vote no?
–yeah, you pegged me…I’m still solidly in the C11 camp. C11, has risk to it as well, I freely admit that.
I think the auto bailout is gaining momentum/support with the public (as DonC mentioned), and it is going to happen on a short term basis. There is not any real shocker there, I figured it would happen…then in a couple months when the ‘big 2.8′ come back for more money, everyone will flip-flop their opinion (again) and want to use bankruptcy as a option.
Onto your question, what CONDITIONS would I put on it? First things first, the only part I don’t like about this poll is that it is worded as “give emergency loans,” it lessons the impact and alters the vote result…a reasonable person knows this is a bailout not a loan and the likelyhood of repayment is poor.
Ok, assuming I ‘had’ to bail them out:
My first condtion is actually on the government, and what this should not be, specifically a loan. Why no loan? It is ridiculous. The major problem with GM et all, right now is it is suffering under terrible legacy/debt costs and obligation…so we are going to ‘loan’ them more money? We are going to hang more debt around their necks? I don’t care if it is at 5% or 0%, they can’t make the payments. So if we give the money…the money is gone. (This is a hard sell to the public, but it has to be this way).
I think we also need to obliterate key members of the executive, but not all…the company still has to be able to function. The people WANT to see some pain doled out along with this package. In GM’s case, the ouster of Wagoner and Lutz…move Fritz Henderson into the job he was born to do.
Equity stake taken by the government. This is the only place they can reasonable expect any money in return. If by some miracle the sky parts, and the auto fairy comes down and blesses them, maybe they see a buck or two.
Oversight…or the all too common reference, “Car Czar” It is important that this person not be affliated in any way with the big 2.8…and possibly have a little disdain for them. This guy is NOT running the show, he keeping them inline and give guidence as to what all three can do to work CO-OPERATIVELY with each other.
The most important thing for government to do once they get the money and basic conditions/guidelines out, is to leave them heck alone. A guy like Fritz Henderson is a really smart guy, a guy that should have been running the company. Wagoner is a GM lifer, a crony in the truest sense…and Bob is borderline certifiable, he certainly does not possess the skill set Fritz does and he is too big of a presence to be allowed to stay at GM during this time.
Other than that, they really can’t do anything. You can’t push a agenda like, ‘make more Volts sooner,’ or tell them to shut this line or close this brand, etc. because then the whole thing gets convuluted. Fritz, with the advisement of the ‘Car Czar’ can work that sort of thing out.
You certainly can’t make one of the conditions, “make some friggin’ money”…would be nice if you could.
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November 13th, 2008 at 12:14 pm
Bill Moore, of EV World, also (in the newsletter) reminded us that Ford converted auto plants to make bombers for WW2 war effort…. maybe GM and Ford could now retool some of their plants to build wind turbines and/or solar, etc. That would provide the jobs to replace those being lost, and will move us in the right direction.
Wouldn’t it be awesome if some of the power used to recharge your Volt also came from a wind turbine also built by GM!
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November 13th, 2008 at 12:15 pm
To #25 Dave K
I don’t wan’t shoestrimg budget made cars. Even if electric… That’s a toy for teenagers. Volt development is not only making a car it’s making thousands of high quality “warranteeable” cars.
and NPNS don’t mean A plug a sell… either.
Protecting leading industries is what any country does. It normally reshape it’s economy “slowly” after the tide has come and gone. Of course when you have a leading position as an industry leader you want to protect that position and this should not came on forms of “bail outs” but here is the entire industry not only the position in the industry that’s at stake. Imagine the US not making cars…
NPNS
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November 13th, 2008 at 12:17 pm
From last thread
Statik @ 31:
Statik #31 writes
#16 Dave B
One more point…the Volt could very well be the answer to oil independence. Anyone giving that argument?
I doubt you can make that argurment. At least not with the Volt. A low level production car at 40K? The car is way too flawed when thinking about mass adoption by the public and trying to get to the holy grail of ‘oil independence’
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700 billion/ 40,000 = 17,500,000
bailout money/cost of Volt = 17,500,000
Now, dump that money into electric cars, and poof, no more oil. I know there are problems here Statik, I’m not dumb. But as Nasaman can attest, we made it to the moon and back. Just think.
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November 13th, 2008 at 12:20 pm
Voted No – Let them file for bankruptcy if they can’t hack it, enough is enough.
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November 13th, 2008 at 12:20 pm
I voted yes with conditions
No Loans , No Share purchase ,
This is what I think is the best solution to a difficult problem.
The only way to do the saving of the auto companies is to place an order for high mileage cars, high mileage hybrids and pure electric vehicles .
The order has to specify that the hybrid engines are not to be over 1.5 liters in size though and they must have the ability to drive over 50 miles on gasoline when it is used as the operating fuel.
There must be a transparency accounting on every dollar spent and none is to be spent on any vehicle of any kind that uses an engine over 1.5 liters , if that were to happen then the bale out order transfer of payments stops right now , no bonus payments of any kind to anybody for any reason period and no Force Majeure clauses either.
Canada should be a part of this deal as well as their government has stated that they are willing to put billions of dollars up to save these corporations from financial ruin . After all , the North American market is made up of United States and Canada anyway , we are in this thing together .
Just one thing though , the Volt should come out as a Cadillac Volt because it is priced like a Cadillac , not as a Chevrolet .
Later on when they can come out with shorter range and less battery and the ability for carrying five people then introduce the Chevrolet Volt and call it a Chevrolet Volt .There could even be a Buick version called the Buick Electra that is made on the same flex frame structure that is pure electric . GM plants in North America couldn’t build them fast enough to match the global demand especially if they were only made in North America (including Oshawa Ontario) for the first ten years as Toyota did and Honda and others have done over and over to protect their workers and their own economy . There are some excellent auto factories in Canada and United States that need something to do . Giving money wont do a darned thing , but placing an order for finished vehicles will save the jobs and incomes of thousands of workers directly and tens of thousands of jobs indirectly. Buying billions of dollars of shares will just enable current share holders to sell their shares and we will be right back in the same predicament in a month or less , you might actually be farther ahead to give the money directly to the shareholders as they might invest in some other auto or battery company that needs venture capital, you can buy a lot of serious production for $25,000,000,000.00.
Let me think about this for just one little minute , if the finished car was sold for $25,000.00 and it cost about $15,000.00 to make seems that the auto industry would make lots of money (USA prices) The same car could be landed in Seattle or San Francisco if it were made in China for about $8,000.00 USD and that is what will happen if the wrong thing is done , we will be buying BYD hybrids as they will be the only real production cars that are made to North American standards , not smoke and mirrors with lots of wishful thinking………………
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November 13th, 2008 at 12:20 pm
I think GM should be taken over now by the Gov’t.. Why delay the inevitable. I look forward to this nationalization experiment. What happens to the car dealers in all this isn’t clear to me.
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November 13th, 2008 at 12:27 pm
Although our economy is made of many diverse elements, it is primarily driven by 2 industries; the housing industry & the auto industry.
The $700 billion bail out should not have gone to Wall Street, it should have gone to home owners in distress so as to keep them in their homes, thus they can continue to consume goods & services, which drives our economy.
It is therefore essential that the Government step in ‘bail-out’ the auto makers.
I vote: yes, with conditions attached
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November 13th, 2008 at 12:28 pm
hi Lunoir #36
“I don’t wan’t shoestrimg budget made cars. Even if electric… That’s a toy for teenagers.”
___________________________________
hi Pat #30,
“Ya right! a hobby car for the masses….. give me a break!”
___________________________________
Guys, please reread post #25.
I didn’t say to go out and buy a kit car.
I said,
“The auto manufactures of the world are very aware of how to build an EREV. The current economic conditions DEMAND that at least two or three manufactures take their shot at producing a Volt-like production car.”
You feel angry and frustrated because you realize that this is the truth.
=D~
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November 13th, 2008 at 12:29 pm
#18,Tim Gordon’s idea of retrofitting this countries existing fleet is an excellent idea. Give the customer the choice of an extended low monthly payment plan or just pay for a retrofit out right, and in the beginning make it a tax credit. GM can partner with several battery companies and focus a good portion of R&D to next generation battery technologies.
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November 13th, 2008 at 12:31 pm
I voted no. I’d like to start my own poll of the folks that voted yes. The question is this: Will you vote yes again in 6 months when GM asks for another bailout?
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November 13th, 2008 at 12:34 pm
#39 Keith
I don’t agree with all of what you said, but I think ordering high mileage cars is a real good idea. How many cars are bought by the Gov every year? Do they only buy American now? I know they buy quite a few Black SUV’s.
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November 13th, 2008 at 12:38 pm
I voted ‘Yes, with conditions’.
I’m not an American (I’m a Canadian, so it’s not my money). But if I was, I would want them to be given a loan with conditions.
One of them should be to produce gasoline-free cars.
Since GM is asking the American taxpayer to essentially become investors, then the taxpayers should have a say in what GM builds. A lot of people want electric vehicles/gasoline free vehicles. So, That should be one of the conditions. Gasoline-free vehicles, or no deal.
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November 13th, 2008 at 12:41 pm
Imagine the example they would set if Governments bought Electrics instead of big black SUVs. All of them State Local and of course Federal.
I love the idea of a GM supported conversion process as suggested above.
Take Care,
TED
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November 13th, 2008 at 12:43 pm
statik:
Sorry pal, Condition #1 is no more jets. No aircraft of any description. All wretched excess with negative ROI. Fly in the back of a 737 like the rest of us, boys.
#39 Keith:
Yeah, BYD. If you listen carefully, you can hear the footsteps coming up behind us. Welcome to the nation of burger flippers.
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November 13th, 2008 at 12:45 pm
Steal from the productive (rich or not) and give to the non-productive (poor or not).
Is THAT what made America strong?
Apperantly, many think so(cialist).
The USA is DEAD!!!!!!
Welcome to the USSA. You will be assimilated. Resistance is futile…
(at least until the collective suffers a fiancial heart attack from it’s own pork or is destroyed by those who still believe in the Constitution, the free market and the rule of law)
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November 13th, 2008 at 12:46 pm
Its a superiority thing.
They say guys with small drive large cars.
Guys with small intelligence buy foreign cars to show they can’t make a decision based on quality.
They just buy foreign to be in style with the Jones.
I saw a person buy a new American car and I though wow someone does care. It was the new Chevy Malibu and it looked great.
If you ask the same ding dong if they bought an apple Ipod or and apple computer its in style.
American engineers designed that apple and it’s an American company. Opps should not have said that it might make people return there ipods.
Its time American people start having some pride!!
Support GM,Ford
Support our new president.
Oh and people like tim above should move to the USSR they would be happier there because they are anti-american.
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November 13th, 2008 at 12:49 pm
GM has so many issues:
1.) wrong products
2.) Bad dealer contracts – why can’t people bypass the dealer and have the car shipped to their house
3.) Management is horrible
4.) Very Bad Image, Bush Administration connections and environment issues
5.) They keep pushing for federal funding for products we never see (ex. Hydrogen)
Other would add labor costs here but I don’t think that is the case. Japanese cars cost more than American cars and if Labor is the issue then we would have seen more investment in automation.
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November 13th, 2008 at 12:50 pm
I voted yes, with the strings. My logic is, if U.S. Taxpayer money is to be used in this bailout, there should be a direct benefit TO said taxpayer, such as making sure the first production runs of any alternate energy vehicles are to be sold in the U.S. only. This way, we can get the benefits of moving away from the oil that crashed our economy in the first place more quickly, rather then having the cars we’ve now paid for three times before they were ever purchased be sent overseas, giving our country NOTHING for its investment. Getting tax money to make the Volt real, then sending it to another country, would be the nail in the coffin for any future help. Why should we send subsidized cars where we can’t use them?
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November 13th, 2008 at 12:52 pm
Can you imagine the impact of President Obama and his entourage driving around in US made electric vehicles?
The US military is looking at hybrid trucks, because it has realized the cost of diesel fuel delivered to a war zone. $24/gallon in Iraq. Let’s use some of that research and build Pres. Obama some hybrid limos. Hybrid Tahoe limos? I know that the mileage isn’t very good, but the symbolism would be great.
Our local Caddy dealer has 6 Escalades lined up on the front of the lot with “HYBRID” decals about 8″ high on the rocker panels. Every little bit helps Mr. President. Run them on Switchgrass ethanol, LOL. CNG?
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November 13th, 2008 at 12:54 pm
Not NO, but heck NO.
I’m a small, struggling business owner that has seen good and bad times and never turned to the American taxpayer for a bailout. I’ve had several business ventures fail: some were because of my mistakes and another was unforeseen market events.
If a company is being run poorly, it should fail. If GM is constrained because of unions and other issues, it could file bankruptcy and start over to a more level playing field. $25b will not fix GM’s problems, just delay the end. What’s next, the airlines, military contractors, ….
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November 13th, 2008 at 12:55 pm
#16 Dave B said (last thread), “One more point…the Volt could very well be the answer to oil independence. Anyone giving that argument?”
#31 Statik said (last thread), “I doubt you can make that argurment. At least not with the Volt. A low level production car at 40K? The car is way too flawed when thinking about mass adoption by the public and trying to get to the holy grail of ‘oil independence’”
#37 Dave B said (this thread),
700 billion/ 40,000 = 17,500,000
bailout money/cost of Volt = 17,500,000
Now, dump that money into electric cars, and poof, no more oil. I know there are problems here Statik, I’m not dumb. But as Nasaman can attest, we made it to the moon and back. Just think.
————————–
I know your not dumb, I was not trying to insult you…I was just suggesting it was a bit tenuous to make the argurment that the Volt could be America’s answer to foreign oil.
I’m really not clear with what you are suggesting here. Are you suggesting that GM be given a 700 billion dollar check, and funnel it all to the Volt? What about Chrysler and Ford?
I outlined some points that I thought were a lot better/cheaper to get America off oil specifically than this plan to produce EVs directly (in post #31 on the last thread). Things like, scrapping the 10 year warranty on batteries, reduce crash standards to allow for ‘euro/international’ models to enter the country, allows electic LSV vehicles on all city roads/mph roads 40mph or under and a 3.5% quarterly gas tax hike (up to a doubling of todays price) to be redirected towards EV and ‘renewables’ programs.
We were talking strictly about making the argument that the “Volt could very well be the answer to oil independence”
If those kinds of funds (as you suggest) where going to be routed directly to a EV program, the Volt would definitely be scrapped…it would need to be streamlined, made into a ‘people’s car’ program, probably three model types, one made by each automaker, so as not to have them war with each other. Something like a 2 seat commuter/roadster platform, 4 seat sedan platform and 7 passenger van/SUV platform.
I know/understood what you were getting at, I just took it a little farther to a logical conclusion and to tie it into the bailout:
(from me in last thread, #31)
“Better yet, imagine what would happen if the government just gave GM, Ford and Chrysler a order for $500 billion worth of electric cars? They all have their credit back instantly, their employment stabilizes (if not expands), they can ‘compete’ with the foreign automakers, and we all get electric vehicles (and cheap too with that kind of volume and less standards)…the bonus is the government gets some return on their money when they are sold, avoids the headache of automaker collapse, and of course the infamous, ‘oil independence’ movement gets a big kick in the pants.”
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November 13th, 2008 at 12:55 pm
Re: My previous post #23.
I see a few similar minds that recognize the opportunity to MAKE the car industry get us off foreign oil. If we can not trust our government and certainly not Big-Oil to do the right thing then make it contractual with the taxpayer in the form of a strings-attached loan.
Get us off foreign oil! =D~~~~~~~~~~~~~~~NPNS
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November 13th, 2008 at 12:57 pm
Bill, I think your right about the Jones statement. I am always proud to buy American. I believe that American cars are much better quality then any others. I keep my cars for a long time and I take care of them. I am really upset with GM because they dug there own hole. It is the management and the type of products available I am upset with and not the quality of the products. If the Volt was out 2 years ago, I believe GM would be far ahead of others. It would be the iPod of cars and then everyone who is concerned about the Jones will get their own iPod (Volt).
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November 13th, 2008 at 1:04 pm
#48 noel park
statik:
Sorry pal, Condition #1 is no more jets. No aircraft of any description. All wretched excess with negative ROI. Fly in the back of a 737 like the rest of us, boys.
———————————
Ok, I’ll amend my list for you.
Condition 1A: No more jets….and no more leating those little packages of nuts on that 737 either, they have to stuff as many in their pockets as possible then sell them at the dealerships. All profit my friend…all profit.
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November 13th, 2008 at 1:07 pm
#4 Jason M. Hendler
” This first round should be lightly conditioned
- preferred, non-voting stock for the government
- salary / bonus caps for execs
- development / retooling for more efficient or alternative fuel vehicles
If GM needs more help later on, then an arbitrator needs to step in, tear up the union contracts,… like the domestic versions of Toyota and Honda.”
I agree, but would be much harder in phase one:
I would require 6 new people on the Board: Lyle, myself, Nasaman, Statik, plus 2 others (I’m open for tough minded volunteers).
I would let everyone know; say goodbye to those multi-million $ salaries, and say goodbye to the union / benefits, etc. Only people will remain / be hired, who have the same goals as the new lean management team!
GM stock would be a mandatory (small) part of compensation!
=D~~~~
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November 13th, 2008 at 1:07 pm
The big three have a history of poor choices that have led them to this decision point. They squashed competition and innovation in the name of profit at every turn. The big three did not care much for competition as it would cost them millions to keep up with (i.e. Tucker, Toyota, etc.). GM could be on generation 4 or 5 of the EV1 by now instead of crossing their fingers and waiting 2 more years for gen.1 of the Volt. Another way to see this is that they have been losing all night at the high stakes poker table and all they have left is a chip and a chair. That chip is the Volt and there are no wild cards.
I say yes…but with strings. I want all the high level leadership out. These companies need fresh ideas and new blood that is not tied to oil. The big three have been absolutely arrogant in regards to their customers – believing that they know what the customer wants more than the customer themselves. This cannot continue. I want the union contracts renegotiated. A decent wage for a days work is expected. The workers will not get rich from these jobs but they should be able to live a good middle class life. I want the US Govt. to treat this situation like they did in WWII. We are in a war for our very freedoms and this war has struck home. This is an economic war and the first salvos have been fired. Instead of tanks – we will produce Volts (and any other type of serial hybrid that the big three come up with).
My fellow citizens of Volt Nation, this is the time to be bold. We must act now to fix this institution and save it from its poor choices. We dare not let it fail as we cannot say what other industries will be crushed under its massive shadow. The choice before us is clear, we will build a better tomorrow and we will see the day when these companies and this nation are seen as beacons around the world worthy of emulation and leadership. Businessmen from near and far will come to learn what it is that we have done. Magazines will be filled with story after story about the miracle in Detroit. Our children will look on our time as a turning point in history back toward the light, back to being a lighthouse in the storm. I can see it as plain as day…we have only to walk to the path before us, to overcome the obstacles presented to us. And we will succeed.
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November 13th, 2008 at 1:13 pm
Yes. Help them…BUT…
* Bye, Bye Ricky…
* Make the Volt priority one and share it on other platforms.
* We all get shares of stock equal to the average tax payer contribution to help save them.
* Quality and efficiency Must be at least world class.
* No more Tax incentives for Non US branded Hybrids.
That money goes to GM. Ford & Chrysler.
* If you trade in your Japanese vehicle on a new GM vehicle you get a tax incentive as if you purchased a Jap. hybrid.
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November 13th, 2008 at 1:14 pm
Oh..yes…Bye Bye Blood sucking lazy Union.
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November 13th, 2008 at 1:14 pm
Amen harrier1970! I believe you preach to the choir. How do the citizens of Volt Nation get this across to the weasels in Washington? Maybe Lyle can come up with a way to automatically send letters or emails of this type of patriotic and positive style to our elected officials. The only way things will change is to be active not wishful.
Well said, my friend and fellow voltarian.
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November 13th, 2008 at 1:16 pm
#58 Statik:
That’s what I’m talking about! Now you’re getting down to my level. And turn in the !@#$%^ frequent flyer miles too. Do they still give out nuts? Not the last time i flew United anyway.
#59 George K:
What about Statik? Or is he the CEO? I mean, I guess Fritz is OK as far as he goes per Statik, but desperate times call for desperate measures.
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November 13th, 2008 at 1:17 pm
Allow bar codes on registration window stickers to be scanned when you re fuel at a gas station…all newly purchased USA vehicles get cash back like a credit card for incentive to purchase a US vehicle.
These vehicles must be clean running and at the top of class for fuel efficiency.
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November 13th, 2008 at 1:18 pm
Nope.
Use the cash as incentives for growth of small companies. The auto industry business model is not working, it needs to change.
The BIG 3 will not change. Let them fail, then let the entrepreneurs pick up the pieces and develop a new business model for manufacture and sale of automobiles.
By providing incentives for small startups you get many benefits that you cannot attain by a BIG 3 bailout. You also, avoid putting all your eggs in one basket (or 3). We know that small business account for a large percent of the new jobs created. Small business are more agile and able to change to meet the changing global economy.
NBA!
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November 13th, 2008 at 1:18 pm
They should just file chapter 11 like every other business has to. Then they can come up with a restructing plan and dump all those pensions they are carrying.
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November 13th, 2008 at 1:20 pm
This is a tuff question to answer. Part of me says let GM go down just like any other corporation. If I was making computers for example, I would not expect Uncle Sam to come in and bail me out of my problems. But then there is the workforce not just at GM plants but at GM suppliers. For example GM doesn’t make radios, they hire an external firm to design and manufacture radios to GM’s exact specifications even down to the labeling on the unit. If GM folds so does the radio supplier.
GM has made some bad decisions in the past. Like crushing the EV1 irregardless of how it makes the company look in the eyes of its customers. (Alienating customers is a bad business practice for any company.) GM failed to make business decisions based on what is right in favor of what is most profitable. For being college educated business people they should have realized that a product that is entirely dependent on a single external supply source is going to be untenable. And if your product requires more of the external supply it is going to be even more untenable.
So here we sit, a car company that can only make large vehicles that consume more imported fuel than their competition’s vehicles. Fuel that is becoming a major problem in obtaining. A company that had a poor backup plan if their primary product was suddenly rejected by the consumer. Taking way to long to respond to changes in the market by taking more than 3 years to bring an appropriate product to the market. Behaving with we are always right and everybody else is just blowing smoke attitude.
Fail or not, I really just can’t say if it is good or bad.
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November 13th, 2008 at 1:21 pm
Slide said…
“If GM, Ford and Chrysler go under, it will leave a market void that will be filled with start up companies that make cars that Americans actually want.”
Startups? Maybe you mean a handful of Tesla-type companies creating a few cars that most cannot afford.
Otherwise, there will never be another US car company, since the barrier to entry is way way too high. Europe and Asia will own the entire market, making US transportation even more dependent on foreign powers.
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November 13th, 2008 at 1:26 pm
If GM files for Chapter 11, they are done. Would you buy a new car from a company that might not be around in 6 months?
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November 13th, 2008 at 1:28 pm
#18 Tim
Good grief, I actually find myself largely impressed with your thoughts. I had resigned myself to the post of grump.
I especially liked the idea of converting our existing cars to gas/electric or pure electric.
I VOTE YES
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November 13th, 2008 at 1:29 pm
Just free GM from the bondage of the Unions that the U.S. government helped force them into, and this would be a non-issue.
$73/hr = GM Worker Package
$48/hr = Toyota Worker Package
Ouch, how do you compete? You can’t….
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November 13th, 2008 at 1:32 pm
As much as it pains me, I say let them go and re-emerge as a better company.
The fundamental thing to keep in mind is that when government runs out of money they can simply raise your taxes but GM can’t make people buy their cars. With or without a bailout, people aren’t buying GM products. Detroit has been rightfully criticized for not reading the market correctly and even though they could see what Honda, Toyota and others were doing, they proceeded on their own path.
Having an influx of cash doesn’t change their business model which is horrible. The Volt, which has gone up in anticipated price, isn’t going to save GM. A bailout will not cause them to renegotiate their union contracts, make meaning cuts or be competitive. It is a way for them to buy time and I’m certain that if they get the money they will go through it quickly and we’ll be having this same discussion in 6 months.
Debtor in possession financing will be made available if they go BK. The terms will be good for those investors and GM will be incentive driven to be competitive. There is nothing sacred about GM, so much so, that requires us to prop them up.
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November 13th, 2008 at 1:36 pm
They should be allow to fail…
Even if they give them bailout money, the bad decision of that past years won’t be erased…
May be having a smaller big 2 would be better then having a weak “big 3″.
And no matter what, they will come back for more money… your money
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November 13th, 2008 at 1:37 pm
Well put “Jason The Saj”.
I voted NO because this HAS TO CHANGE…..
$73/hr = GM Worker Package
$48/hr = Toyota Worker Package
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November 13th, 2008 at 1:44 pm
Randy C said…
“So here we sit, a car company that can only make large vehicles that consume more imported fuel than their competition’s vehicles. Fuel that is becoming a major problem in obtaining.”
I agree with most of what you wrote, but your above statements are factually wrong.
GM makes vehicles of all shapes and sizes with mileage on-par with (or better than) equivalent vehicles from Japan. The main exception is the Prius. And obtaining gasoline in the US is still very easy, despite the obvious US need to become energy independent.
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November 13th, 2008 at 1:45 pm
Just as a casual observer of the direction of this thread, and for the record:
Having GM, Ford and Chrysler take a bailout package to remain solvent over the the next couple years and ride out the economic downturn, and the development of the Volt or any other EV program are MUTUALLY EXCLUSIVE goals. They do not logically go together.
This bailout package has nothing to do with the Volt, the gov’t would probably prefer projects like this to be scrapped.
I was tempted to add ‘Scrap the Volt’ to my list of conditions ‘IF I was in favor of a bailout’, but because I personally want to see the Volt made for selfish reasons, and I considered the venue at which I was posting, I decided to not endure the ‘firestorm’….so I retroactively include it now.
Added condition: Scrap the Volt and ENVI program.
Sure the EVs may be a cash cow sometime down the road, but it is not today, or in 5 years. In all likelyhood, the ‘big 3′ will never be able to sell EVs for a profit. The EV is all about the battery and how cheap you can make it. No more crazy displacement/tech of engine nonsense, no more need to be a ‘giant traditional automaker’ to compete, no more 12 different types of cars to be sold in 12 different countries with different mileage/performance economics.
The EV actually hastens in a totally new automobile manufacturing era–the ‘world car’ era, and it is probably a era where that car can not be built in America…or Japan for that matter.
/I can feel my popularity growing
Side bar: I only include this condition when I am talking purely about the government bailing out the ‘big 2.8′ and getting maximum mileage for their dollars. I believe in the future of the EV, I think it is a great thing for America as a nation to get off foreign oil, and for the environment on the whole.
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November 13th, 2008 at 1:47 pm
66 JEC…continued (I hit submit to quickly, and ran out of time!)
I have heard several people state that bailing out financial companies is not important, but bailing out the likes of GM is. They justify this by the belief that financial companies provide no real product and no real jobs.
I really do not care if it is a financial company or a manufacturing company. Bailouts are just not going to cut it. Unfortunately, Pandora’s box is open, and everyone wants a peek inside. Shame on us for letting this happen.
Now, the real task is closing the box again, and getting people focused back on what they do, and not trying to position themselves in the bailout line.
So, how do we do this? Well for starters we renege on the remainder of the promised bailout. We then use this cash as seed money for start up manufacturers. We leverage the ingenuity and work ethic of these start ups to create the new automobile business model. Some will fail, but some will succeed.
This could lead to one of the greatest revolutions in the automobile industry, and hopefully leads us down the path of oil independence.
No doubt this will have some very painful short term effects on the economy overall and the individual workers, but in my opinion, trying to force the BIG 3 to be productive will be a longer and even more painful economical down spiral.
Just my opinion….
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November 13th, 2008 at 2:07 pm
With all these talks about the economy and global recession, bank and financial bailouts, automaker bailouts, etc. I hope people are still willing to be generous when it comes time to bailout the oil industry.
With crude prices down to $50 with potential for further decline cash pools and profits in the oil industry can dry up. There are hundred of thousands of people working in this industry. There are the majors and their employee base, there are juniors, there are service companies and drilling/production companies, there are contractors, surveying companies, all sorts of associated manufacturing companies. It scary to think about all of those people and the potential unemployment.
If you bailout one industry or sector you better be willing to bailout everyone else!
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November 13th, 2008 at 2:13 pm
I voted no as well. As much as I want an electric car (a volt especially)
I am disgusted with seeing our country slip ever closer into socialism. No USSA! (United Socialist States of America). The first bailout was unconstitutional! And no there are more?? Where does it stop?!?!?
The constitution say that there will be risk and that risk will be real. The government can’t protect you from that risk. If your not free to fail, how can you be free to succeed? This elemination of risk is a key tenant of socialism. Let the failures fail so that something better can replace them. Maybe Tesla will pick up the Volt without the UAW.
I have no love for the so called “Big Three” (thought people meant Toyota, Honda, Nissan LOL”. Ford did my mom wrong years ago when they sold her a year old car telling here it was new when it turned out it had been wrecked. It died right at 100k miles like clockwork. Now my tax money is going to bail them out? Disgusting!
The volt was to be my first car made by a US owned company. I’m still skeptical, and if they can’t survive on their own, I’ll just have to look to another company. That how it works. No bailout!
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November 13th, 2008 at 2:15 pm
#77 Statik – “This bailout package has nothing to do with the Volt, the gov’t would probably prefer projects like this to be scrapped”
I think you have totally missed the boat on this one. Missed it by 180 degrees. In fact I think a major reason Obama is interested in the bailout for the Big 2.8 is that he sees it as a path to energy independence. If you look at what his transition team has said, and the desire for oversight and so forth, they’ve been very clear that the primary reason for the bailout is to ensure energy independence.
This is not hollow rhetoric, and it actually complicates things by making the road to profitability steeper and more difficult but that’s the road he wants to take. GM, Ford, and Chrysler are going to have to go fuel efficient and electric big time in order to be bailed out. When you think about it, it’s a great opportunity in that otherwise there is really very little leverage that can be used to get EVs into production.
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November 13th, 2008 at 2:21 pm
Do not hand another poorly run company my money.
I did not speculate on real estate, I make my house payment and I’m tired of financing the short term greed of big business.
As taxpayer we must swallow the bitter pill and let the correction happen.
If you want action start buying American. Stop supporting Honda, Toyota and Nissan and start supporting your country. Ford and GM make all the cars that any country needs.
GM does not need a handout, they need customers.
Place a $5,000 tax on any car that is not produced in the US (80% of components) and you will solve the problem.
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November 13th, 2008 at 2:28 pm
I’m not an informed economist, I’m just a regular guy. It seems to me that we dug ourselves into a hole and we need to get out. Will emergency loans get us out? What happens if we don’t provide emergency loans? Do we have other viable options? I don’t think we have many options (but what do I know?). So, I vote “yes, with conditions attached.” Those conditions should be well thought out by smart lenders because I don’t want my money wasted.
Thinking bigger…For too long, we’ve passed debt onto our children in the pursuit of our own self-interests. The “every person for themselves” approach can’t be sustained. We need to cooperate, at least a little. We need/want government services, but we want them for free. I know, pandering politicians gave us things and put off paying for them. We need to end that approach to government. I think it would be noble for us to undertake a war on debt. I would love to see a “The buck starts here” campaign where citizens volunteer $ to pay down our debts, where we finally stand up and do something for the collective good. To some of you, that might sound socialistic or communistic, but it seems patriotic to me – sacrificing your rigid politics for the greater good. Our reward would be a more prosperous country and a better future for our kids. Paying down our debts, building up our industry (especially Volt production), and replacing short-sighted government and business leaders seems like the way to go. You can’t make up with your spouse if you don’t compromise once in a while.
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November 13th, 2008 at 2:29 pm
It’s times like these which create opportunity … fleeting chances to make fundemental changes. Providing $$ to these firms, even with “conditions”, only prolongs the agony and potentially closes the door on opportunity. While the big 2.8 sort through bankruptcy proceedings, let’s have the government define the standard for the next-gen American automobile and spend a few billion to fund its development and prepare factories for production. I’m not usually one to invite government help, but it is becoming increasingly clear to me that fundemental change won’t happen without it.
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November 13th, 2008 at 2:31 pm
I think you have totally missed the boat on this one.
______________________________________
No, he’s right. The bailout is for business recovery.
3.8 Million vehicles purchased in the US last year came from GM.
The technology in Volt won’t reach production volume on that scale for a very, very, very long time. It is a product to sustain future business (sales a decade from now), not to repair the present crisis.
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November 13th, 2008 at 2:37 pm
I want a VOLT and I voted yes with conditions, but after reading so many posts here and realizing that a loan with conditions (conditions to control so MANY areas of auto production, salaries, health care, etc.) it would probably just best to let GM proceed just like any other business that didn’t change with the times and see what happens to them.
After all, like many have commented here, what happens when they ask for more money? Give them more? I guess somebody’s got to pay those million dollar salaries?
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November 13th, 2008 at 2:37 pm
I’m with whoever it was above: the government should just buy out GM.
And of course, anyone who has a million dollar salary should be cut
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November 13th, 2008 at 2:41 pm
Why every attempt to make a EV failed or will fail? Coincidence? I don’t think so. Are people, especially umemployed ones, still interested in the Volt when the gas price like $2/gallon in 2010 and the Volt is 4OK. “Who kills the EV” version 2?
Volt is on right direction but not good enough. Insight and Prius are on good direction.
Instead of GM being a biggest car maker, why can’t it be a biggest (car) battery maker. Let it reconstruct. That is how we strive in the free market econmy.
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November 13th, 2008 at 2:45 pm
#81 DonC
#77 Statik said – “This bailout package has nothing to do with the Volt, the gov’t would probably prefer projects like this to be scrapped”
#81 DonC said, I think you have totally missed the boat on this one. Missed it by 180 degrees. In fact I think a major reason Obama is interested in the bailout for the Big 2.8 is that he sees it as a path to energy independence.
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I don’t think so…strip out the components and you get to the truth.
Do you believe if the Volt project did not exist the ‘big 2.8′ are left to all go bankrupt and get no bailout? No way.
I’m not saying the Volt doesn’t give the bailout some ‘fruity goodness,’ and can certainly be used as a feel good talking point…but it is immaterial as to whether they get one or not. If GM came out today and cancelled the Volt program…the bailout continues just the same.
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“When you think about it, it’s a great opportunity in that otherwise there is really very little leverage that can be used to get EVs into production.”
There is lots of leverage, the $7,500 credit for the first 250,ooo models is a great one…and that only costs them 1.8 billion max. Imagine if they put up even 10 billion for that, it could be $15,000 tax credit for the first 700,000 units. Now that would have EVs all over the place and the infrastructure in place to produce them into the future.
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November 13th, 2008 at 2:46 pm
#77 Statik
“Added condition: Scrap the Volt and ENVI program.”
re my #59
Sorry, you’re off the board.
The Volt is the reason I’m on Lyle’s site. I believe it WILL survive, and I don’t want to buy it from a foreign company. Even if the foreign car is assembled here, that’s a very small part of the pie. The majority of the price goes back to the country of origin.
=D~~~~
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November 13th, 2008 at 2:46 pm
Look this situation is more complicated then what can be posted here. Here are the main points:
1. We need a domestic auto industry. Too many other jobs are linked to this capability. We cannot lose the knowhow that’s in this industry. If we lose this, we will NEVER get it back. The foreign car companies no not MANUFACTURE here. They only do low tech final assembly. They are not the same thing! This is not fully understood by many economists.
2. The American Car companies do not have poor management! The people are very capable but they are operating in a very difficult -almost impossible environment. It would be impossible for all the car companies to be mismanaged for so long. At least one of them would have stumbled onto the right management at some time. All the car companies are doing poorly as are MANY if not most American Manufacturing Companies! This is indicative of a systemic problem.
3. The UAW and the US Government are a huge part of the problem with the auto industry. The UAW thought they could ignore the laws of economics. The US Government thought (to the extent they can think) that they could put an unlimited amount of goverenment regulation on the industry and somehow they would manage the problem. They also negotiated free trade agreements with countries who have none of the same burdens the US auto industry has.
4. The US Government has to have some type of package to help out the industry. They are to a large extent responsible for the problems. I’ll let the other posters debate the type of package, whether it be a loan or whatever.
5. Let’s buy American. I have two American vehicles. I try to encourage my friends to buy American. They need to look at all the various types of American products. The quality has improved tremendoulsly in the last 5-10 years.
Go Volt, go Cruze!
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November 13th, 2008 at 2:48 pm
@Hoang
All the LithiumIon batteries that are affordable and that can make an EV affordable/profitable are in China. Trust me on this one. We have tried to get a few batteries to test from some US battery manufacturers and they either told us our Quantity is too low (needed some for R&D purposes) or their prices were out of this world. I honestly can’t blame the Union on this one. Try it. They’re all jus “A phone call away…”
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November 13th, 2008 at 2:52 pm
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“Yes With Conditions Attached” is the only viable option.
Right or wrong, “Yes With Conditions Attached” is how this will play out. The general market has been profoundly impacted by the current credit crises. A Chapter 7/ll failure of GM in this market environment could wind up in history books as the memorable defining tipping point that was responsible for triggering a prolonged recession; the straw that broke the camel’s back. In the long term, such a failure would strengthen the free market and enhance the accountability of our politicians. But the short and middle term market cost would be very high and require public “it is their fault” executions. It is this issue of culpability that will end up most contributing to the “Yes With Conditions Attached” government intervention because our politicians on both sides of the isle know that they are in large part the architects of the current credit crisis and they don’t want it to read on their political epitaphs that they had a significant role in the demise of GM. Many believe GM may have been able to pull off their re-structuring strategy were it not for the credit crisis. The cost of us taxpayers for aiding GM will be significant but we will derive short term and middle term benefit. GM’s long term cost will be the cost of the organizational cut backs it did not make because the bailout/loan continued to fund those costs, the considerable additional debt and/or stock dilution, and the added organizational overhead that comes along with making the US Government its principle equity partner.
I remain a huge fan of the VOLT Program and look forward to the delivery of my VOLT.
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November 13th, 2008 at 2:53 pm
This auto manufacturer bailout loan crap makes me not want to vote. YES, it’s a bailout and a risk. The risk is, they will probably use the money unwisely just like before and not make a profit. Please tell me, how do you pay back a loan without profit? And who made the calculated risk to do this? The big three auto mfrs should be allowed to fold. I highly believe the UNION is the main cause of their failure. Think about it. Why should a person with no college education, some don’t even have High Scool ed, make $29/hr for mounting hardware on hardware? Tires, seats etc… I have seen people “Stage” parts like screws and washers and gaskets and push buttons that get paid over $24/hr. Give me a break. No wonder they are losing money. They have to support the morons in their work force. A high scool student can do this for federal min wage!
Most everything is automated and the unhealthy stuff is done by robots. That’s ridiculous. If one were to vistt one of their plants and audit this you will see it’s true. I have been in manufacturing for 10 years. Positions get a pay increas because of tenure? WTphuk is that? After 5 years your still an idiot manual robot doing the same thing you got paid for when it was minimum wage! This is NOT fair wage. The big three should fold and the American people should not have to suffer through their reign of OPEC Support terror.
DROP THE UNION! Or better yet, shut down the plant and reopen WITHOUT THE UNION! Sure, promote “Buy American”. I’ll spend my money on some good ol Amercian fun like go see a Baseball game and scarff down 8 hotdogs and a pitcher of beer before I spend a boatload of money on an american car just to help support the afformentioned idiots employed there. Don’t get me wrong, not all are itiots, just the floor rats. If it weren’t for the UAW, US auto prices would be more competitive and affordable to Americans.
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November 13th, 2008 at 3:00 pm
Let’s take a look at this PHEV incentive that was passed also. To take advantage of this incentive, the vehicle you purchase must have soo much battery in it, can’t remember the specs but it was 3x more than any current foreign hybrid uses or aAmerican Hybrid. Ironically if you look at any vehicles that can qualify, only the Chevy Volt and other US hybrid wannabe vehicles can qualify. Why? Because they are soo inefficient they require that much battery to run. So basically these US autos can not sell themselves and the big 3 need the govt to try and make the deal sweeter. For this reason I will never purchase a US big 3 vehicle again. The American people CAN survive even if the big 3 auto are gone. Need a car? There’s others to choose from? Lose your job because the plant failed to foresee the coming inevitable world change and they blindly charged on building Bradley Tank SUV’s? No problem, other auto manufacturers exist here in the US and when competition is gone from the big 3, guess what, manufacturing increases elsewhere in the US. Incentives for this PHEV bill should go to the vehicles that ARE PHEV. That should be the criterea. Then the consumers can decide WHAT PHEV they want to buy. So, guess what, they will most likely not buy?, a Chevy Volt and I highly recommend against the volt. This vehicle as well as any other attempts for the big 3 to sell as a hybrid / PHEV is just like their predecessors. They were hogs on gas back then, and in this generation they are hogs on batteries! Nothing has changed and they learned nothing. Tell me again why we are giving these huge loans to the same people that enticed people and sold Americans these poor excuses for a vehicle? I hope they all go under. This will open the doors to the small entrepreneurs like the “AC Propulsion”, “Phoenix Motors and “Hybrid Technologies” or “Black Bay Technologies” nad “Lion EV”. Don’t get me wrong, the Volt is an outstanding concept. I just don’t agree with their business practices therefore they will never get my bussiness again or support. Here’s proof Ford can produce a high mileage car: http://www.carpages.co.uk/guide/ford/ford-fiesta-studio-1.25-3dr.asp , funny they don’t offer it here in the US, we don’t deserve it?
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November 13th, 2008 at 3:01 pm
Basically IF the big 3 took what “Hybrid Technologies” is doing and refined the process, expand their facility, buy them out and ensure product reliability to “Their” standard, “Qualify” the build as “Warrantable” then I believe the big 3 can make a come back. Think about it. This little comapny, Hybrid Technologies, takes already built ICE vehicles and convert them to 100% Electric in about 4 days. You get a range of 100+ miles. Good for commute and for soccer practices and runs to the grocery store, run to fast food for the 3 kids and home. That is a perfect idea. So there, I just retooled the big three in less than an hour, my bill is $50Billion please.
Of course this will not happen because Detroit has this “It wasn’t my idea so I wont bother with it” persona. Sure they’ll probably get the loan. How’s it feel to be left out in the cold for those Americans who lost their homes to bad loans? Govt will bail big auto but leave Americans to fend for themselves and at the same time pay for this friggin mess. Yes, it is true that “We weren’t pushing these larger vehicles, we were just building what our customers wanted,” Mulally said….” (Quote from: http://afp.google.com/article/ALeqM5h4EahO3VBl2HqNDP58DrifgZ_RlQ) but you continued and did nothing to “Adapt” to the market, Just like the dinosaurs, and guess what, the Asteroid of OPEC hit and you cant “Adapt”! Hey Detroit, “Retool THIS!”, b@st@rds.
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November 13th, 2008 at 3:02 pm
#90 George K
#77 Statik
“Added condition: Scrap the Volt and ENVI program.”
re my #59
Sorry, you’re off the board.
The Volt is the reason I’m on Lyle’s site. I believe it WILL survive, and I don’t want to buy it from a foreign company. Even if the foreign car is assembled here, that’s a very small part of the pie. The majority of the price goes back to the country of origin.
=D~~~~
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Heeh, funny. I did disclaim that I in no way want this to happen. I am selfish and want my electric car already!
I just merely suggested that the Volt program runs counterproductive to the government and GM’s attempt to ride out this downturn.
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November 13th, 2008 at 3:03 pm
Umm….
I’m thinking this peace guy voted No?
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November 13th, 2008 at 3:04 pm
#94 your anti-union rant has some good points but fails to address some major issues. First off management is one of the most important issues. UPS is probably the best example of managment doing its job. Its a union company but those people work hard for their money. Performance pay is a major problem with unions. Regarding US auto prices, I believe they are some of the best priced autos. Compare their prices to Honda or Toyota and you will see. The other stuff from Kia, Hyandia is just junk. You can put a waranty on junk but it is still junk. How many of those are around in decent condition after 10 years?
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November 13th, 2008 at 3:07 pm
@statik
Ditto here. I just want an EV Volt. If I bought one and GM is gone, then I have a “Collectors” item.
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November 13th, 2008 at 3:10 pm
1. I vote yes.
Also it’s about time we Tax the foreign car companies for unfair trade practice, and treating workers poorly.
We need to tax the foreign car companies $2000.00 per car.
That way it will be fair and we aren’t allowed to even sell cars in there country.
Oh its good bush is getting out of office. Toyota spends so much money lobbying congress I think they spend on the order of 3 times what GM does to keep the US government on there side. When Obama is in he won’t listen to the Toyota goons anymore.
So we can start Taxing Toyota and imposing trade restrictions.
They are a horrible company and bad for the USA.
Its funny people here say GM makes gas Guzzles. Well Hello people every American family told Detroit to make them!!!
Its not Detroit’s fault it’s the fault of the greedy American people wanting that large hummer.
Now that you have slammed your own country and your own industry you want to justify for buying that hummer.
This logic just blows me away. Its time for change and time to change Americans to support our industry.
I agree with Obama he drives a ford escapes hybrid. How come you don’t drive American?
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November 13th, 2008 at 3:10 pm
Statik said: “There is lots of leverage, the $7,500 credit for the first 250,ooo models is a great one…and that only costs them 1.8 billion max. Imagine if they put up even 10 billion for that, it could be $15,000 tax credit for the first 700,000 units. Now that would have EVs all over the place and the infrastructure in place to produce them into the future.”
Now there’s an idea I could get on board with! Imagine, $25000 Volt after your $15000 tax break, GM makes money on each one, generates volume, keeps workers busy, generates cash flow, and we get an EV for a bargain. Not bad!
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November 13th, 2008 at 3:12 pm
@brad
“You can put a waranty on junk but it is still junk. How many of those are around in decent condition after 10 years”.
Are you talking about GM or Ford or Chrysler? Or all of them?
I don’t know about 10 years but I know after 20 years some Honda or Toyota still run fine.
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November 13th, 2008 at 3:12 pm
I voted NO because I believe GM’s (Ford, Chrysler) problems are systemic and cannot be fixed with a simple money injection… when the cash runs out, the problems still exist. I would have gone with Ch 11, but it wasn’t an option.
One factor for a bailout and against allowing GM to fail: The Volt team. I’m a project manager and I guarantee you that there is an enormous amount of knowlege that’s bound up in the Volt team. While some of that knowlege is bound up in individuals in the team, other knowlege is contained by the team as a whole or groups within that team. If you break the Volt team up, you’re going to lose some of that knowlege.
BTW, while bailouts don’t make sense from an economic perspetive, they are completely consistent with a socialist political perspetive: Stronger central unions and actual gov’t ownership of major manufacturing sectors.
Some other points… regarding “GM builds junk”, I just bought an ‘08 Chevy Avalanche and its the best vehicle I’ve ever owned. The gas milage is not great, but I don’t intend to use it as everyday transportation. But in every other way, it is the finest vehicle (car or truck) I’ve ever owned. When I was doing research on the Avalanche, I saw over 20 reviews. No-one disliked the truck and many said “I love this truck, I’ll never sell it”.
Also, “GM cars suck gas… Japanese cars get much better milage”… not so. A Toyota Tundra gets about 20% worse gas milage than my Avalanche.
The newer model Chevys and Cadillacs are very good vehicles. I suggest you drop your preconceptions and look at them again.
Regarding the variations on “screw the executive bastards… no perks”: While I have no love for most middle managment, the people who actually accomplish things need to be rewarded. Granted, the compensations to senior staff are obscene (and have been for quite some time). How about a compromise: Cut managment salaries and compensation by 75% but put targeted bonuses in trust for the managers to be paid out if their responsibilities succeed in a specified period of time (say five years). The idea being to offer them enough money to stay with GM and a well-defined carrot (big bucks in five years). If the company fails the bonuses in trust go to pay off GM’s liabilities.
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November 13th, 2008 at 3:13 pm
80 Matt: Ford did my mom wrong years ago when they sold her a year old car telling here it was new when it turned out it had been wrecked
That wasn’t Ford that lied to your mom… it was the dealer. I have a co-worker who was hosed by his Volkswagen dealer the same way. He supposedly bought a brand new Jetta… and about 6 months later, he found that it was damaged and repaired without him knowing.
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November 13th, 2008 at 3:13 pm
#34 Statik
Condition 1B – Everyone to wear pink ties…
Agree about the Henderson part too..Intersting comments about Ford’s way of addressing the issue. They are NOT delaying the launch of new vehicles..that is delaying what they need, so they will look at other ways, but they recognize that they NEED the new rpoduct line even though som eof his exec team stated that with gas dropping the BIG SUV / Truck market will return,and we can wait it out..Mulhally said..Um no.
These execs that think like that have the attention span of a goldfish..
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November 13th, 2008 at 3:20 pm
There is only one condition that is a must – the UAW’s extortionary contract MUST be made null and void and the UAW worker’s salaries
tied to those of non-unionized US autoworkers. Those conditions that jerks like Barney Franks have imposed with respect to executive salaries in other companies are nonsesne – those salalries are insignificant when compared to the premiums that the UAW workers extract from the US auto industry, with the assistence of laws that encourage non-competitive labor conditions and allow
labor rate price fixing by the unions. There IS no free labor market for the unionzed automakers. And we have all paid for decades. Now the UAW is once again using its political clout to extract dollars by extortion from the taxpaying consumer. Just say NO to the UAW and their Democratic Party shills and protectors. This is nothing but a political payoff to the union for all thsoe campaign contributions. Amazing how the unionized media has completely ignored the real problem.
Unions suck.
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November 13th, 2008 at 3:21 pm
#77 Statik
>> Sure the EVs may be a cash cow sometime down the road, but it is not today, or in 5 years. In all likelyhood, the ‘big 3′ will never be able to sell EVs for a profit. The EV is all about the battery and how cheap you can make it. No more crazy displacement/tech of engine nonsense, no more need to be a ‘giant traditional automaker’ to compete, no more 12 different types of cars to be sold in 12 different countries with different mileage/performance economics.
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If this were true, Tesla would be banging cars out like crazy. In point of fact, Tesla has admitted to their hubris and conceeded that building cars is harder than it looks… especially in a highly regulated environment like the US market.
In heavy manufacturing, imagination is important but domain knowlege is critical.
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November 13th, 2008 at 3:24 pm
“Also its about time we Tax the foreign car companies for unfair trade pratice, treating there workers poorly.
We need to tax the foreign car compaies $2000.00 per car.
That way it will be fair and we arnt allowed to even sell cars in there country.”
What a stupid idea! The foreign car companies are already building their cars here with “American” employees on “American” soild paid with “American” dollars. How much fairer can you get? That’s a level playing field. Tax them because they are much much better and efficient, smarter and better foresight in the market? Sure let’s punish the good and award the DUMB. Sure that makes sense.
You must get awarded plenty from your own principles.
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November 13th, 2008 at 3:29 pm
I voted no because the money, or at least half of it, will go to the UMW. They blew it just as much as management.
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November 13th, 2008 at 3:34 pm
#95 WarrenPeace – “Because they are soo inefficient they require that much battery to run.”
This is most certainly not the case. The larger battery is used in lieu of gasoline. The Japanese hybrids are ICE cars with a battery assist. The Volt is an EV with an ICE range extender. Overall the Volt will use 20% of the gasoline used by something like the Prius.
The union and loan rants also are fundamentally misinformed.
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November 13th, 2008 at 3:36 pm
#108 ThomC
If this were true, Tesla would be banging cars out like crazy. In point of fact, Tesla has admitted to their hubris and conceeded that building cars is harder than it looks… especially in a highly regulated environment like the US market.
In heavy manufacturing, imagination is important but domain knowlege is critical.
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You are right for sure, you do have to have a background in the process.
Although Tesla is a underfunded entity founded by a eccentric ego maniac trying to make a super exotic electric car before the battery technology is viable.
/I know what you are saying though
(=
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November 13th, 2008 at 3:40 pm
#77 Statik
In all likelyhood, the ‘big 3′ will never be able to sell EVs for a profit. The EV is all about the battery and how cheap you can make it. No more crazy displacement/tech of engine nonsense, no more need to be a ‘giant traditional automaker’ to compete…
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Statik gets it.
The bailout would need to be in the hundreds of billions just to possibly temporarily reestablish the domestic auto makers in building traditional vehicles. They can’t compete in EVs. They have no future.
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November 13th, 2008 at 3:52 pm
#89 Statik – “If GM came out today and cancelled the Volt program…the bailout continues just the same.”
I have no doubt this is wrong but it’s hard to explain since your scenario is so unlikely. Let’s put it this way: For GM, a strong and binding commitment to E-flex or something like it will be a condition of the loan. If GM refuses it won’t get any money. I think it’s that simple. Now of course it’s preposterous that GM won’t accept the condition, in part because there will be sufficient commitments to provide incentives for the cars if that proves necessary. However if GM refuses to build a boatload of E-flex vehicles then it won’t get the money.
Obama and his team are dead serious about energy independence and transforming the economy. Among other things, they are determined to get at least a million EVs on the road by 2015. It’s not just a talking point. I think the basic reason for misreading this reality is that for the last eight years we grew accustomed to meaningless happy talk designed to appease constituency groups from an administration devoid of a domestic agenda. It’s a new ballgame.
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November 13th, 2008 at 3:58 pm
Although I am really for a Chapter 11 reorganization, I voted yes with strings attached. I voted this way because the answer I wanted was not available. Plus, I am realistic enough to know that C11 would be pretty difficult at this time for GM to accomplish. So, yes with strings attached was the next best thing. As with “The Devils In The Details”, what is contained in the strings attached will make or break this argument. I believe GM needs to drop some of their lines (Buick, Pontiac, GMC, Hummer) and reduce the number of plants. Programs like the “Jobs Bank” with situations like what we have been reading about lately need to be halted. A “Jobs Bank” program to actually train a person for a new career in or out of GM is a good thing, but not where an employee is paid to just show up and sit all day for years on end. I hope this was not but a small instance of that kind of thing. If not GM and the UAW should be totally ashamed. They must be somewhat ashamed now, but they should be even more ashamed with things like that happening.
I hope for the best for GM because I want to see it succeed even if they never produce the Volt. Of course, I want the Volt or something even better to hit the streets as soon as possible. I did like the idea someone mentioned in the earlier post about creating a Buick Electra that was all electric. I would agree with that and it could be the only car made carrying the Buick name plate.
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November 13th, 2008 at 4:00 pm
“some experts argue that a Chapter 11 re-organization wouldn’t be possible in the current illiquid environment.”
THAT’S when the gov’t steps in, with a gov’t re-organization loan that gets approved and monitored by a bankruptcy judge. That gives the judge the authority to actually force GM to comply to the conditions of any loan given to them. If GM doesn’t go bankrupt, there is no way for it to discharge debt and restructure payments.
GM will continue to build cars under bankruptcy.
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November 13th, 2008 at 4:09 pm
The Japanese hybrids are ICE cars with a battery assist. The Volt is an EV with an ICE range extender. Overall the Volt will use 20% of the gasoline used by something like the Prius.
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What about the Ford hybrids?
What about GM’s own Two-Mode?
Volt technology is a long-term solution, nothing that will rescue automakers from the immediate problem they are struggling with. Why is that so hard to understand?
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November 13th, 2008 at 4:12 pm
@10 slide
yes but they’ll be expensive as hell without economies of scale
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November 13th, 2008 at 4:18 pm
I just heard on NPR (National Public Radio) that some lenders (banks) are unwilling to give people loans cars made by big 3, but are giving loans for buyers of cars by other manufacturers. Presumably because the car may be worth less if manufacturer goes bust.
Once a company looks in trouble it can be a death spiral.
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November 13th, 2008 at 4:20 pm
#11 DonC
Just wait a minute, if you will. I seem to remember a lot of democrats and a certain Mr. Clinton supported free trade agreements. It was not just republicans doing the voting. I do remember many, many democrats defending Fannie and Freddie and threatening to cause problems if republicans tried submitting bills to put controls on home purchases with little or no credit history or ability to re-pay the loan. No one is completely blameless.
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November 13th, 2008 at 4:20 pm
In response to DonC’s (#11) incorrect statement, the free market didn’t create this, government meddling in the free market of housing loans, brought this on.
Everyone should remember the wise words of Thomas Jefferson when he talked about government being a necessary evil. Should we bail a government created mess with more government involvement? Logic tells me that, somehow this ‘extra bailout’ will only make things worse. Ch11 was developed for a reason and sure no one wants the Volt or GM to go away. I say GM is playing Chicken with our feeble politicians and all the bluster will fade will their hand is called.
That is why I voted No. Socialism is wrong, don’t trust it even when it looks good. There has to be a better solution to this government created (Wall Street finished) mess.
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November 13th, 2008 at 4:26 pm
#117 john1701a – “Volt technology is a long-term solution, nothing that will rescue automakers from the immediate problem they are struggling with. Why is that so hard to understand?”
You’re completely missing the point. No one has suggested that E-flex will save GM in the short term. In fact everyone should recognize that EVs and fuel efficient cars may make it more difficult for GM to survive in the short and medium term. The point is that E-flex is the reason for saving GM.
Do the math. The goal is 1 million EVs by 2015. No car company has committed to having EVs in any quantity except GM, and they won’t start until the end of 2010. That means you have five years to get the million vehicles on the road, which is roughly 200,000 EVs a year. Not going to happen unless you can get GM cranking. It is your critical supplier.
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November 13th, 2008 at 4:27 pm
All of us, myself included, continue using the term “taxpayers” as though all of us are taxpayers. If I remember correctly about 40% of us pay no taxes and another percentage above that pay little taxes. Now, I am only referring to federal income taxes. I realize that if you purchase fuel, you pay taxes. Everyone who receive income in wages or salary pays “payroll taxes” as in social security and Medicare taxes. And I am not talking about state level sales taxes since this bail-out is to be done by the Federal government. Quite a number of us do not purchase fuel because we do not own a vehicle and another number of us do not pay payroll taxes because we are either unemployed and on assistance or have income where it is not taxed for “payroll” purposes.
So, the term “taxpayers” is a pretty mixed bag of terms rolled up into a word we can all “relate” to. But, it is becoming harder and harder to relate to that term.
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November 13th, 2008 at 4:31 pm
To DonC
I shall concede on the battery issue on the fact of my ignorance on the “Design” of the drivetrain on the Volt. My main point is that the “PHEV Tax Incentive” was obviously designed only for the Volt and was “Designed” to exclude the foreign or other Hybrids.
As for my “Union rant..” well, lets just say I saw it first hand. We had people that were getting paid over $26/hr staging gaskets, screws matching washers, assembling modules (Like lego’s), peeling labels, unpacking parts and sometimes “Assisted” in guiding heavy parts. Now here’s the big catch. They were only allowed to “Assist” and could not do the actual work on mounting heavy pieces because it was not part of their “Contract”, “working out of scope”. OK, I was obviously involved in manufacturing. Often times they sat on their asses doing mindless work.
So NO, my assesmento of the union at work for those folks are entirely ACCURATE!
DonC, have you worked in the manufacturing?
As for the Loan, are you telling me they are not getting the loan they asked for? They asked originally for $25 billion then another $25 billion then in another thread on this site they asked for the $700 billion to be “Ammended” to include them. Is that nisinformed?
That’s what I read in this forum, is this forum misinformed DonC?
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November 13th, 2008 at 4:32 pm
#103 I’m talking about Hyundai and Kia.
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November 13th, 2008 at 4:38 pm
The goal is 1 million EVs by 2015. No car company has committed to having EVs in any quantity except GM, and they won’t start until the end of 2010.
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Neither the hybrid nor fuel-cell promises of the past came even remotely close to reality.
What commitment is this?
Please provide a source.
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November 13th, 2008 at 4:49 pm
It looks like the Republicans are going to scuttle the bailout. The Senate will see if they can work something out and if so maybe the House will come back:
http://www.nytimes.com/2008/11/14/business/14auto.html?ref=business
Maybe we will get to see what a Chapt 11 with govt loans looks like. I think folks are beginning to realize that GM can’t compete in it’s present condition.
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November 13th, 2008 at 4:55 pm
#109
Foreign car companys are NOT building cars here. They are ASSEMBLING them. If you don’t want to believe this then if you happen to live any wheres near one of their factorys [assembly plants] simply park near the receiving area. You will see many crates and skids coming in from their home country but little to no raw steel, castings,bar stock, or even aluninum for die casting. THEY ASSEMBLE. The high skill machining jobs are still in their home country
I firmly believe we should be taxing them at a min. of 15% of the selling price and give no rebates or customer tax incentives for their cars.
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November 13th, 2008 at 5:04 pm
Tim #18
I applaud to your post and I dream this could become true.
Thanks for the thinking.
JC
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November 13th, 2008 at 5:05 pm
I didn’t vote, my choice was not there.
I want GM to go C11. As this is not possible these days without govt. support, this is where I want the govt to step in.
1. Save only three divisions.
1A Govt to guarantee warranties from the three divisions.
1B Limit pay to a max of 1 million per year. (Bye rick).
1C Statik to oversee bailout.
2. Change the CAFE law so the two fleet rule is gone.
3. Increase CAFE to the point EV type vehicles are needed to comply. My beloved Volt for instance.
4. The GM-Volt wait list to be given priority for ANY E-REV vehicle produced.
/OK I was pushing it a bit on the last one, but without the pork who would take this plan seriously?
As a side note, in Japan after three years your car has to undergo a major service check paid by the consumer, after six years another even more major one requiring partial disassembly of the car. In most cases it is cheaper to buy a new one. It is govt. rules that give Japan such a strong vehicle assembly capability.
At the end of the day, does it matter where the car comes from, as long as you get off oil?
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November 13th, 2008 at 5:09 pm
Just wrapping up at work, so have not have time to read the contributions / thoughts of others. So some, perhaps all of this, may be repetion. Sorry ’bout that.
I’d say no bailout if all along the playing field had been relatively equal, i.e. the Big Three had been allowed to compete all these years in Japan on an equal footing (no Japanese government trade restrictions on foreign auto imports), and that Japanese automakers had to deal with the same union burden here as US automakers. Those handicaps have contributed to the Big Three’s current circumstances.
While the Big Three have made their share of mistakes over the years, the others haven’t been sweethearts either.
So in the end I voted for “bailout with conditions” – which for me would include restructuring union contracts to scale pay levels to what those jobs and benefits are worth in the real world, finding realistic economies of scale and then do it – including merger(s) if that is what makes sense. Main goal for me is keeping US auto mfg and supplier workers employed, and some auto mfg capacity in American hands to maintain some competitive environment. Also has to be some sensible control on executive pay, some realistic oversight and metrics on performance, and some solid prospect for returns to the taxpayer over the long haul – 7 – 10 years.
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November 13th, 2008 at 5:11 pm
Alot of resistance to this ahead of its tabling:
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Republican leader criticizes auto-bailout idea
It’s unfair to taxpayers and bad fiscal policy, Rep. Boehner says
“Republicans say it is key that reforms would need to go with new cash. “Spending billions of additional federal tax dollars with no promises to reform the root causes crippling automakers’ competitiveness around the world is neither fair to taxpayers nor sound fiscal policy,” said Boehner, R-Ohio, in a statement on Thursday. ”
http://www.marketwatch.com/news/story/key-house-republican-critical-auto-bailout/story.aspx?guid=%7B88D0689E%2D2243%2D46BB%2D9A1E%2D056222403F55%7D&siteid=yhoof
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“Right now, I don’t think there are the votes. I don’t know of a single Republican who’s willing to support” the auto bailout, said Sen. Chris Dodd, D-Conn., the chairman of the Senate Banking Committee. Dodd, who said he personally backed the idea, cautioned against “bringing up a proposition that might fail,” and appeared to suggest that Congress wait until President-elect Barack Obama is sworn in on Jan. 20 to provide further help to the carmakers.
http://biz.yahoo.com/ap/081113/auto_bailout.html?.v=4
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They clearly would rather not see this bailout come to pass while the Repubicans are running the show.
I think there is a lot of posturing too…you know they want something to trade-off for this, otherwise it is ‘lame ducking’ all the way until Jan 20th (I don’t know if the Columbia Free Trade thing is still a option after ‘the leak,’ but I’m sure there is lots of other stalled Republican projects lying around).
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November 13th, 2008 at 5:29 pm
I’d rather have a GM and Ford in case I needed to survive a war.
Can’t imagine why I’d need AIG in a war.
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November 13th, 2008 at 5:37 pm
I just read War & Peace faster than WarrenPeace’s posts.
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November 13th, 2008 at 5:48 pm
The hate american/hate GM crowd here is unbelievable. Let ‘em fail. Right, we have little manufacturing capability left as it is and you want us to have fewer. Union costs are where they are because congress mandates it. You can hate the salaries that auto executives make all you want but try to get a good exec for oh say $500,000.00 a year. You want government to take over? Sure, we can then ask Russia to send us the tooling for their POS Lada. And because the government will want its money back it will mandate that only gov built cars can be purchased. This makes lots of sense.
$73/hr = GM Worker Package
$48/hr = Toyota Worker Package
That is the start and end of the discussion. It’s not exec compensation, it not badly built cars. You CAN’T compete under these conditions. Because the Dems owe the unions BIG TIME what is going to happen is the Gov will force Toyota, Honda and other foreign owned US based factories to join the UAW. Guess where you precious Toyota prices will go then!!! As for Lutz being an idiot…he has had a big role in the Volt so lighten up.
Save them with the conditions that UAW union rates match the other foreign shops. Then let them fight it out.
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November 13th, 2008 at 5:57 pm
India – Govt sold all its stake in Maruti.
US – Govt is buying stakes in banks, Auto etc
Sad. GM should be given loan with conditions and need to have review on all major steps and how they spend money.
John Chambers ( cisco systems CEO ) took only $1 as salary at recession times. Let GM follow the path – may be better if they can hire him as CEO.
or even BillGates – who is free now – is a better candidate for CEO.
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November 13th, 2008 at 6:07 pm
It’s interesting to see the variety ideas in this thread.
I used to work in the IBEW Union. I now work in a nonunion job. The reason we don’t “go union” is that the management has been able to meet us most of the way on most issues. And we are fortunate enough to realize that we need the company as much as they need us.
Most employees are happy and show this with a smile or a nod as they pass in the hallways. We have a “green” program which rewards $ for alternative vehicle use. We have a referral program which rewards $ employees for finding new good workers. We have a low cost group outings program. Examples are $40 trips to Dodger games or discount tickets and transportation to popular shows.
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To change gears a little…
Perhaps a future thread could look at insurance costs related to the Volt. What will it cost to replace a crushed front right quarter panel? How much will AIG charge for collision and liability? Will the battery need a “leak inspection and test” after each collision?
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We don’t know if the Volt will ever be mass produced. But, we should proceed with the thinking that it will. Does anyone have insurance numbers for a Phoenix car?
My 150 mph motorcycle insures at $175 per year for basic liability.
=D~
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November 13th, 2008 at 6:09 pm
We should look into the ideas in #18 above.
Save the automakers, stimulate the economy, dramatically reduce our oil addiction which also will help clean up our environment.
4 birds with one stone.
Now that is some creativity.
Maybe all the options aren’t miserable. Maybe there is a way to do something fantastic here.
Great ideas Tim Gordon!
Take the rest of the day off.
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November 13th, 2008 at 6:11 pm
Bush has the best idea he will be moving to his new ranch in Peru. The government there has signed into law that he cannot be removed from the country and tried for war crimes. The Texas version of an african dictator, cause total caos and then get the hell out of the country. GM IS IN TROUBLE BECAUSE IT WAS RUN INTO THE GROUND BY BEAN COUNTING REPUBLICANS, BOTTOM LINERS WHO SAID ITS GOOD ENOUGH AND NEVER SPEND ANY MONEY ON R AND D OR RETOOLING. P.S. did you see John Mcaine the countrys hero driving away is his yoshi mobile. What a great american. WE ARE ALL FREAKEN DOOMED!!!!!!!!!
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November 13th, 2008 at 6:22 pm
#114 DonC
#89 Statik said – “If GM came out today and cancelled the Volt program…the bailout continues just the same.”
#114 DonC said, “I have no doubt this is wrong but it’s hard to explain since your scenario is so unlikely. Let’s put it this way: For GM, a strong and binding commitment to E-flex or something like it will be a condition of the loan. If GM refuses it won’t get any money. I think it’s that simple. Now of course it’s preposterous that GM won’t accept the condition, in part because there will be sufficient commitments to provide incentives for the cars if that proves necessary. However if GM refuses to build a boatload of E-flex vehicles then it won’t get the money.”
Obama and his team are dead serious about energy independence and transforming the economy. Among other things, they are determined to get at least a million EVs on the road by 2015. It’s not just a talking point. I think the basic reason for misreading this reality is that for the last eight years we grew accustomed to meaningless happy talk designed to appease constituency groups from an administration devoid of a domestic agenda. It’s a new ballgame
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How do you account for Ford being involved in this bailout? By your reasoning, should they not be excluded and left to go bankrupt? It has to be equitable across all three automakers.
I’ve not even heard a whisper of qualification for any of them, other than the basis that they are a bloated US automaker that is out of money.
Why should/would GM be binded to the Volt, when Ford has absoluting nothing on the burner? Will Pelosi legislate a electric vehicle program into Ford’s lineup?
Also, I’d like to add what does ‘E-flex’ have to do with producing the Volt or not getting the bailout? If they cancelled the Volt, they would still have E-flex. E-flex is just a easily adaptable line that can produce different models of cars quickly. (I’m going to assume you meant some form of electric vehicles here and not just GM’s catch phrase for their plant processes)
And how would they set up a equitable balance of electric or hybrid or type vehicles thoughout the ‘big 2.8′ in like 14 days? They have no one on the inside, they don’t understand the workings of these companies.
They are doing all they can, working 24-7 just trying to get votes to be able to try and pass it, not dreaming up conditions that ultimately could disqualify the companies they are trying to bail out. This is only about saving Titanic sized companies from sinking and dumping over paid employees overboard to wash up on the island of government unemployment.
We are just going to have to agree to disagree I guess on this one. At least this is one of those discussion where we will know who is right…after all they have to table this thing pretty soon. If they make Ford hit electric vehicle targets to get the money…your right. If they don’t…I’m right.
Side note: I miss my gravatar. I still see it when I edit my comments. Too bad they make the forums suck when we have threads of 300+ comments…wonder if there is a fix for that?
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November 13th, 2008 at 6:32 pm
Just food for thought. Five hedge fund managers testified today. Their average salery is one billion a year each. Somehow they got their income classified as capitol gains so they only pay 15% taxes.
Once again my mind is boggled.
I hope GM makes it through this mess and the union negotiates down to the pay that the guys building the imports make, and top management gets flushed and we go on a national security get off imported oil lets make plug in cars track.
The other thing we must do is get the responsibility for health care off employers. It is an obvious burdon that other companies in the world don’t have because the government pays for it. Our health care system is inefficient because so much energy is spent trying to deny coverage.
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November 13th, 2008 at 6:54 pm
#135 Lloyd
$73/hr = GM Worker Package
$48/hr = Toyota Worker Package
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What GM employees get for their $73 is a big difference than what Toyota workers get for $48. GM employees get decent health care as employees and as retirees. They get pensions, something that a lot of older people have. At the same time there are a few benefits that we could do away with.
Toyota employees loose their health care when they retire. I would guess that they also get a 401K, which is fine but does Toyota match anything? Toyota has been in this country a very short time compared to GM, Ford and Chrysler so they do not have the legacy costs that the American companies do. In Japan, Toyota does not have to worry about providing healthcare and pensions, the government does that.
GM is doing a lot to save money. They recently have done away with the voice mail system, corporate wide. You may say big deal, but it has been estimated that it will save them 1 million a year. At all plants they are reducing the temperature at all the plants to an even 66 degrees to reduce heating costs. It does not seem like a big issue but it will save the company a couple million over the next year or so. There are other things at my plant that are being done that will save in material and labor costs and will equal millions.
As we little people in the company are doing all kinds stuff to save the company money a bet the executives are still getting paid the big bucks. If anyone has the time, look up the pay for executives for the auto companies. Compare the pay of the American companies to that of the foreign ones.
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November 13th, 2008 at 7:03 pm
Chrysler urges bailout, Washington split
Thu Nov 13, 2008 5:34pm EST
Thursday, JPMorgan cut its GM rating to “neutral” from “overweight” and said the automaker needs “something immediately” to make it through the end of the year.
The warnings come in the wake of GM’s deeper-than-expected third-quarter loss and cash burn, announced on Friday.
Lawmakers will hold a hearing next week to consider a bill to give another $25 billion in federal loans to U.S. auto manufacturers, possibly using part of the $700 billion financial market rescue law enacted last month.
But the White House said on Thursday it was not the intent of Congress to use the financial rescue package to help ailing U.S. automakers, while U.S. Commerce Secretary Carlos Gutierrez told Reuters that opening the financial bailout fund to one industry was “not a good idea.”
Standard & Poor’s lowered credit ratings on two North American auto parts suppliers and placed the ratings on 14 other suppliers on negative watch, citing their exposure to the three U.S. automakers.
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The Nikkei newspaper reported that Toyota Motor Corp was considering delaying the start of production at its new Mississippi plant until 2011 or later, from 2010.
=D~
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November 13th, 2008 at 7:16 pm
Yes, with strict conditions. First, we need G.M. will need to buy out the shareholders, because, their allegiance is to them and not We the People, and since we’re going to pay for the bailout, G.M. will have to buy oil strategically. Meaning, the transportation industry relies on oil to get the economy going. By diversifying, say: electric motor, hybrid, flex fuel, we can reduce middle east dependence, get out of OPEC and use alternative source of fuel. Next, bring back all the manufacturing from: China, Mexico, Korea and all the other third world country. Then break up the monopoly and finally, hire U.S. citizens ONLY.
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November 13th, 2008 at 7:17 pm
hi J Man #142,
“GM is doing a lot to save money. They recently have done away with the voice mail system, corporate wide. You may say big deal, but it has been estimated that it will save them 1 million a year.”
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Ford lost millions this quarter.. GM lost BILLIONS.
A billion is 1000 times more than a million.
Perhaps GM can remove 1/2 of the break room soda machines. Think of the savings on the electric bill.
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J Man, we here at gm volt have been lashed several hundred times with reports of cash burn, postponed product releases, and a variety of unexpected bad news.
We really need to talk salary reduction from $15 million to $1 million per year. And weekend work wages from $70 to $30 per hour.
Does everyone at GM want to work at a Target Store? Come on Michigan, wake up. The days of the 10,000 lb 400 HP SUV are behind us.
I wouldn’t preach this if it hadn’t happened to me. I lost my oil related job because of overhead costs. I didn’t cry and melt in a corner. I renewed my outlook, opened my mind to the future needs of my family, and found a job at 55% of my former pay level.
I say “YES” to all OT offered. And maintain a good attitude and a clean presentation. I go out of my way to help others. One employee (an Iraq war vet) calls me the Army Ranger of our company. Do more than expected…and then some. Get with it guys.
I’m off to the gym.
=D~
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November 13th, 2008 at 7:22 pm
I just wrote my Congressman. I told him my feelings on this subject.
I told him the government should give GM a low interest loan after they file chapter 11. Then I told him to put me in charge. I would fire the board,
and pick my own team to turn GM around.
Who is with me? The pay is $200K, no bonus and long hours.
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November 13th, 2008 at 7:26 pm
To old man #128
If you want to take that way of “THEY ASSEMBLE” then yes the Detroit 3 do the god damn thing!
I’ve seen many subassemblies come in and material parts fabricated from a third party. Problem is, where the third party contracted to get the raw goods. All the Detroit 3 cared about is the second was here in the US. So, now if you want to go deeper, where does the fourth party go for the “RAW Materials” to fabricate parts for this US auto company? Who knows or cares!?!?!. That’s GM’s and other US auto manufacturers. Don’t give that bullsh!t about Assembling. Has anyone even bothered to see where the Lithium Ion Polymer raw materials came from?……I didn’t think so. China is the biggest exporter/importer of this.
I have seen many plastic composite preassebled modular components brought in where all that needed to be done was plug in the molex eletricals and snap it in. A monkey can do that.
Assemble, yes they assemble. So does the Detroit 3. Research it or go visit one of your plants dumb@$$.
Yes I am bitter because. I have been there, done that as some would put it.
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November 13th, 2008 at 7:30 pm
Also let me mention that in many cases, for parts the company “Sole Sourced” from another company and was stuck paying more than 25% – 35% more for the part that a competitor was selling for less. Bad business practice, sole source that is.
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November 13th, 2008 at 7:38 pm
Normally, you would want to have a new team at the top when a company asks for government assistance. The people who head up the company are the most responsible for the bad situation, and someone has to be held accountable.
But I don’t think anyone would consider this a normal scenario. Macro-economics has hit all car manufacturers in a way that no one predicted. If anyone is to blame, it’s the people who sold all those bad mortgages. So I don’t think Wagoner should step down.
I do believe that GM should be required to make all new cars flex-fuel capable by 2012. The cost for this is relatively minor. This main issue boils down to using a different type of plastic in the fuel lines.
GM should also be required to increase average fuel efficiency in a big way. As I’ve said before, the Volt gets an average of 314 MPG, so every Volt GM sells would increase average fuel efficiency significantly.
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November 13th, 2008 at 7:39 pm
Has anybody looked at the price of pump gas lately? Here in Houston its less than $2/gal. Kinda undermines some of the incentive for electric/EREV cars, don’t you think?
Yesterday the DOE Energy Information Agency has projected an average 2009 gas pump price at $2.37/gal. Almost makes my recent purchase of a Chevy truck look not quite so stupid
However, I used to do contract work for DOE/EIA and I know the quality of analysis (and analysts) that comes out of EIA… I’m not going to get rid of my econo car or motorcycles any time soon.
Seriously, I understand and agree with the desire to get the US off of imported oil, but a protracted easing of crude oil prices could give the US automakers the breathing space they need to recover. There may still be a Volt in our future!
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November 13th, 2008 at 7:49 pm
I think that the gov’t should bail out the automakers but make a very strong statement that all companies getting help from the gov’t should take every step possible to to make themselves more energy efficient (i.e. solar panels, wind turbines, etc) and NOT WASTE MONEY ON GAS GUZZLERS!! make vehicles that don’t use gas and they will reap the rewards. DUH!!!
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November 13th, 2008 at 7:51 pm
The drug dealers (OPEC) will drop their prices to keep us addicted. However, I think we go burned enough this time around that alternatives are still going to be a more sought after solution than in the past.
Just give me my darn Volt!
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November 13th, 2008 at 7:55 pm
#80 Matt
Ford did my mom wrong years ago when they sold her a year old car telling her it was new when it turned out it had been wrecked
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Ford did not do that, the dealership did. Sadly when you get bad service from a dealership the auto company gets the blame. When you get screwed at a dealer, the dealer screwed you. If you don’t like it find another dealer.
I have a dealer in my home town that I have had a bad dealing with. After that I never went back, my money is just as good at any other dealership and they will take my money with just as big of a smile.
When I lived in PA a dealer told me that they would not do warranty work on my wifes Cavalier since it was not bought at their dealership. When it came time to buy a new car I did not buy it from them.
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November 13th, 2008 at 7:57 pm
Chapter 11 with all contracts renegotiated union wages no more than 15% higher than those paid to non union workers in south + cost of living variation based on increased cost of area in which they live. Production eliminated or cut back to current demand on all models with appropriate job cuts with retraining for displaced workers at US Gov. expense in fields that pay more than new wages for workers retained that are in demand. Union can negotiate in good faith knowing the alternative is bye bye to UAW along with the big 3. UAW workers may need to get a second job for awhile, scale back cost of living, sell their boats and summer homes but should be able to live within their means by adjusting accordingly. Across the board cut of 30 % of pay or the heads of all top Mgmt + & significant cuts in all perks until profitable building energy efficient electric vehicles, government relaxation of standards to allow Govt. purchase from big 3 of fuel efficient diesels now made in Europe to help big 3 bottom line until electric hybrid vehicles in cost effective high production. Govt. provided interest free loans with 3 years before payment due and Mgmt salaries regulated until all repaid.
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November 13th, 2008 at 8:03 pm
#147
I have been to the factories of both american and foreign built cars.
I am retired from the machine tool industry. When an american manufacture makes a car , as an example the ICE they bring in a raw casting and send it thru a transfer line or in some of the newer shops thru a series of CNC machining centers, they do not simply uncrate it. Same with transmisions and C V joints
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November 13th, 2008 at 8:06 pm
Chris Dodd: No you can’t have a bailout. NOT YOURS.
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November 13th, 2008 at 8:10 pm
Chris Dodd says the Detroit bail out, which he supports, doesn’t have the votes in the Senate. The Bush Admin has the authority to bail them out under TARP, but they won’t unless Congress forces them, and GM will likely be in bankruptcy court by the time Obama takes office.
This is the end of the line. GM is going under. The Volt/E-Flex program in particular might be an excellent acquisition target, but it’s fairly certain that any ownership transition would end all hope of a 2010 rollout.
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November 13th, 2008 at 8:17 pm
Will Nancy Pelosi untie Rick Wagoner from the railroad tracks before the train arrives?
Will Harry Reid untie Bob Lutz before he goes through the buzz saw?
Will Barney Frank stop the runaway stagecoach before it takes Fritz Henderson over the cliff?
Tune in tomorrow for the next thrilling episode of “As The GM Turns”.
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November 13th, 2008 at 8:21 pm
#145 Dave K
I understand that $1 million is a small amount when you are loosing billions but a lot of millions will ad up over time. I was just giving a couple examples to show that they are doing some things to help rather than sitting by and doing nothing. As far as I am concerned they can take all the pop machines out to save electricity as well. I buy mine much cheaper at the store anyways.
There are many ways that GM could save money. I will be the first to admit that there are union negotiated benefits that could be done away with and would save the company close to $1 billion without touching our wages or health care. Everyone wants to cut union worker wages but the white collar workers and executives who make more money seem to be ok.
I would like to have weekend wages of $70 as well. In the last 7 years I have worked maybe 8 saturdays and no sundays or holidays. Not because I don’t want to but they are not offered. Sadly when people talk about auto employees you only hear of the extremes not the average people. Yes there are people out there that will work anything and everything they can get, that is who you hear about. But the majority of us are lucky to get a couple hours here or there. Most of us live off 40 hours a week and do it comfortably.
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November 13th, 2008 at 8:26 pm
#121 Adraian – “the free market didn’t create this, government meddling in the free market of housing loans, brought this on.”
Step away from the bong. I repeat, step away from the bong!
I have no idea where you get your information from but you are fundamentally misinformed. Talk radio perhaps? In any event, while I don’t really understand why you’re making this claim, my *guess* is it has something to do with Fannie and Freddie. If so then the argument is untenable.
The big problems with home loans were in Alt-As, Subprimes, and Exotics. By definition none of those loans are conforming, and Fannie and Freddie only handled conforming loans. FWIW conforming loans have not be a serious problem. In fact, not only did the “free market”, meaning markets with no connection to government, result in 99% of the losses in home mortgages, it was also the “free market” that has compounded the potential problem beyond belief with unregulated default credit swaps.
While Fannie and Freddie did make mistakes, in ordinary times — meaning without the craziness and excesses of the “free markets” which slurped up crow’s piddle like it was champagne — Fannie and Freddie would have been fine. They were killed by the rising tide of foreclosures of homes whose mortgages were held by private entities which acquired them in “free markets”.
Wake up. Smell the coffee. Realize the problem was created by too much leverage, too much faith in flawed computer models, and a lack of regulation.
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November 13th, 2008 at 8:45 pm
hi J Man #159,
The idea of limiting exec pay to $1,000.000 per year:
This is 52 pay checks (weekly) of $20,000
This is all I am going to say.
=D~
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November 13th, 2008 at 8:46 pm
#124 WarrenPeace
I live in CA. I’ve run businesses. I am not a fan of unions and I’m even less a fan of nutcase employer regulations, of which we have many in CA.
That said, the UAW is not to blame for the legacy problems of the big 2.8. Years ago Walter Ruther wanted to have the government handle health care for retired workers. The US automakers said no, we’ll handle it. Bad decision. Not a bad decision of current management of course but the legacy costs are the result of this legacy decision.
Also from everything I’ve heard and read, after the recent concessions, in 2009 or 2010 the labor costs of US and foreign manufacturers are supposedly equal.
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November 13th, 2008 at 8:51 pm
You have to love this economy and the financial markets, lets review today’s news:
Foreclosures up an unexpected 25% year over year
Unemployment surged to 516,000, 30K higher than expected
The country’s largest retailer Wal-Mart lowers expectation Q4
Oil rebounds a couple bucks
And now this
–Budget deficit for first month of the new fiscal year, drum roll please — almost a quarter of a TRILLION dollars, 237.2 billion — ONE MONTH! That is a annualized deficit of close to THREE TRILLION dollars
http://biz.yahoo.com/ap/081113/financial_meltdown.html
What does the market do? Swings 900 points from being down 350 to closing up 553 points on the DOW, S&P up 7% (+58.99) and the NASDAW up 6/5% (+97.49)…with the VIX going full berserker.
On top of that, we are getting forecasts like this, “And as bad as these numbers are, they may look good a year from now because things are going to get much worse,” said Sung Won Sohn, an economist at the Smith School of Business at California State University.
/makes complete sense to me
//continues to sit on sidelines
///anyone care to attempt to explain this to me…I am at a loss
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November 13th, 2008 at 8:57 pm
#140 Statik
Keep in mind that Podesta’s think tank, Center for American Progress, has been doing pieces on the auto industry and the electrification of the automobile for years. They have no need to start from scratch in coming up with nostrums. Most of the policies and goals have been well thought out.
I’m not sure why you question Ford. It has four or five hybrids and engines that will run in E85. They don’t have E-flex of course but they could certainly get it …
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November 13th, 2008 at 9:01 pm
Statik!!! Your entertainment value alone is off the freakin’ CHART, man–I love it–you really kill me……my eyes are watering, I’m laughing so much!!!!!
I guess, at the end of the day, all any of us can really say is: THIS IS THE CRAZY WORLD WE LIVE IN………..
Or my personal favorite from Norm Peterson: It’s a dog eat dog world, and we’re ALL wearing Milk-Bone underwear!!!
Thank you for the comedy relief in the sad reality of our cynical world, brother.
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November 13th, 2008 at 9:09 pm
I voted yes and want the industry saved!
BUT, how about doing some thing like what Ford did when he changed from production of the Model T to the Model A. Lay off everyone who is not working on the Volt or next generation cars and close up shop for a year! Let unemployment take care of workers and let GM be reborn as a new company in a year with no loan to repay.
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November 13th, 2008 at 9:10 pm
hi statik #163,
Thank you for the words of inspiration.
We keep laying it out plain and simple.
income – cost = profit
I believe that Rick, Tony, Bobby and the boys have enough in the bank to say, “You don’t do the talking…we do”.
In layman’s terms this is called: F U money
___________________________________
Now for the hourly wage earner…
You can keep saying, “We gave away so much.. we can’t survive on less than $22.50 per hour. It’s not possible in Michigan”.
Please set your pride aside for the sake of your family, for America, and for the U.S. auto industry.
If you maintain this attitude you will be cooking minestrone soup in the cafeteria of a Detroit hospital.
Or changing oil at Jiffy Lube.
This isn’t funny, it’s the truth.
=D~
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November 13th, 2008 at 9:18 pm
By the way, it looks like senate republicans aren’t willing to go along with more assistance for the auto industry. See here for details:
http://cnnwire.blogs.cnn.com/2008/11/13/dodd-says-gop-support-insufficient-for-auto-bailout-package/
I think the best course would be to accelerate the $25B already approved for the auto industry. Convert this to immediate assistance in the form of loans or preferred stock purchase. If GM gets $8B of that, it should hold them until June 2009. By that time, the new administration and congress will be able to pass a better package for the auto industry.
In other words, just do the minimum required assistance for now. Things will be more favorable after Jan. 20th.
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November 13th, 2008 at 9:26 pm
I thought a lot about the bailout; I think it is going to be a mid-term and long-term mistake if our tax money goes toward a bail-out to the big 3 three.
Reasons:
Argument that trying to save GM because of the Volt is simply insane. Volt is projected to cost > $35K and that alone will bring no benefit to this country in the mid-term. That is an unfeasible vehicle and very few people would buy it at that price. It is not a matter of putting together the right technology, you have to deliver it at a reasonable cost.
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November 13th, 2008 at 9:34 pm
Yes, With Conditions Attached.
The list is too long to type, but here are a few condition that should be adhered to until loan is paid back.
1. No bonus or incentives pay for anyone working for GM.
2. No increase in Executive or Management headcount.
3. No salary increases.
4. Salary Cap. No salary over $100k/year for any Executive i.e. President, CEO, CFO, and VP’s.
5. Salary Cap. No salary over $65k/year for any Management and non-Management positions.
6. 80% of the loan is directly used get the Volt & E-Flex technology for sale in show rooms.
7. Discontinue production on 10 least desirable vehicle models with no replacements unless E-Flex.
And much more I don’t have time to list.
NPNS!
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November 13th, 2008 at 9:36 pm
Whatever happens, we know one thing: the workers will all get screwed, while Red Ink Rick and Bob Lutz and the other worthless executives will get a sweet bankruptcy proof pensions and millions in compensation.
Is this the type of a firm that we want in the US? What happened to accountability?
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November 13th, 2008 at 9:36 pm
Like a spoil child, sick by bad habits, people are trying to pump money to save bad practices and mismanagement. That never worked. I am willing to bet money that giving $50 Bil. to the not-so-big-Three will just delay the collapse for few more years or months.
I have no desire to see the US manufacturing companies failing, but the reality is that I drive a German car simply because I could not find a feasible American one.
Let competition reign! It is not fair to Honda, Toyota and others who won the competiton if the US pumps money at selected American companies, guys.
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November 13th, 2008 at 10:02 pm
I think liquidating is the best option for America and the world…And I’m a GM stockholder too.
GM’s assets should be sold to the highest bidder. This would set in motion a complete shakeup of the auto industry worldwide and after the dust settles, would result in much better cars. Whether you’re a green freak or just like cool cars, this should make you happy.
Volt is so near completion, I’m sure a smart business person will buy it and possibly bring it to market even faster than GM was planning to bring it to market. There are probably rich smart people the world over already scheming how they could buy up pieces of a bankrupt GM or Ford and immediately deliver much better value to the consumer.
I feel bad for the employees, not so bad for the investors; this is a great thing for consumers.
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November 13th, 2008 at 10:15 pm
#10 Slide
As much as I want the Volt to be made, I have to vote No. Every company we bail out, we move closer to socialism.
Right on brother. Who wants an American car from a Canadian (ideologically socialist) company.
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November 13th, 2008 at 10:21 pm
Well, after what the banks did to steer bailout funds to CEO executive pay and bonsuses, now totalling $70,000,000,000.00 billion dollars ( 1 in 10 dollars of the bailout funds provided), I’d have to say strings attached by all means. Or, ask Congress to rescind the CEO pay and bonus portion of the $700 billion dollar bailout and send this money instead to save our prized industry.
@#!@$# banks. Why 100 already overpaid CEOs of the banks felt the need to steal our taxpayer money to covet golden parachutes to CEOs is unfathomable. Just as unfathomable was one party’s insistence on “No Caps for CEOs!” in order to compromise that bailout into existence. Unbelievable. Thank God almighty for elections this past fall.
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November 13th, 2008 at 10:25 pm
The government should only bail out GM if the UAW will resturcture their contract as part of the deal. Also GM should be limited as to how much they can pay their executives for the next 5 years.
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November 13th, 2008 at 10:26 pm
P.S., Marlon, driving his German made car and those driving Japanese made are proof of UAW wages not being the cause. Guess what they comparatively make in their socialist approach to their auto industries. Soon China will be invading America with Communist made cars. Let’s hope our politicians wake up – Free trade needs to become Fair trade.
Save the General – a.k.a GM.
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November 13th, 2008 at 10:28 pm
The bank bailout was how not to do a bailout. Every prior bailout of the auto industry wound up making the taxpayer money. The last , Chrysler in the 80s, made the US treasury $500,000,000.00 in returned value above the loan value.
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November 13th, 2008 at 10:30 pm
I came up with a poem:
GM, it used to be the FAME.
GM, now it is lame.
Ford, it thought it was a lord.
Ford, finaly realized it came the Accord.
Chrysler, Mercedes Benz backed you up only for you
Chyrsler, Mercedes Benz walked away from you
Now repeat first two sentences.
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November 13th, 2008 at 10:34 pm
hi nc #173,
Good point,
I believe the first manufacturer to produce a small EREV SUV (or lifted hatchback) will be king of the hill for at least 5 years.
The formula is this:
EREV drive ~ 150 HP(eco) -180 HP(sport)
A simple, user friendly control system.
7″ of ground clearance. Rear wheel drive preferred (4×4?).
Seating for 4 plus a child seat.
Cargo room ~ hatch area.
_________________________________________
There you go car manufacturers. Who really wants the gold?
All Phoenix (of Southern California) needs is a better battery and they take it.
http://garfwod.250free.com/Photos/Phoenix-SUV.gif
=D~
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November 13th, 2008 at 10:50 pm
#176 Jason J Says: “The government should only bail out GM if the UAW will resturcture their contract as part of the deal. Also GM should be limited as to how much they can pay their executives for the next 5 years.”
————————————————————————————–
Yes. Those are good conditions.
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November 13th, 2008 at 11:00 pm
#165 Flash
Statik!!! Your entertainment value alone is off the freakin’ CHART, man–I love it–you really kill me……my eyes are watering, I’m laughing so much!!!!!
I guess, at the end of the day, all any of us can really say is: THIS IS THE CRAZY WORLD WE LIVE IN………..
Or my personal favorite from Norm Peterson: It’s a dog eat dog world, and we’re ALL wearing Milk-Bone underwear!!!
Thank you for the comedy relief in the sad reality of our cynical world, brother.
————————–
I’m available for weddings, bar mitzvahs and birthdays parties
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November 13th, 2008 at 11:06 pm
I think the unions should bail out Chevy. It’s time for them to give back for all the times the unions stuck it to Chevrolet.
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November 13th, 2008 at 11:08 pm
I too am a GM stockholder. Over the years I have watched their DUMB moves. They have ALWAYS decided in favor of short term profits. NEVER for long term profits. If thats the way you want to run a company then so be it. I am down to something like 16 shares so I no longer care. I vote for letting them fail. That is the only hope for some new people at the top. JMHO You all can hang on every word from the top but IMHO it is just not that true. The serial Hybrid was invented in 1899. I worked with it in 1973. GM did a Honda type of hybrid back in 1969. They knew the game long ago.
Take Care
Arch
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November 13th, 2008 at 11:11 pm
For the extreme fan boys of turbine / wind technology do you realy want those nasty, unsightly, problematic contraptions? Oh I know the answer is yes just not in my backyard. I think a better power solution is to make solor required on all new home construction and aslo mandatory to be installed on the roofs of businesses. On anyones next flight to almost any big or even medium small city take a look at all those vast roofs with nothing on them. We don’t need to build large solar farms we already have them with the required energy transmision systems in place, all we need is the solar panels installed.
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November 13th, 2008 at 11:18 pm
GM would much rather sell more cars than get federal money welfare. I think the best way to “bail out” GM is to guarantee bank loans for everybody similar to the VA mortgage loan guarantees so anybody can go out and buy a new car. Will that mean people with rotten credit run out and buy a car they can’t afford? Yep. But, it will also mean thousands of people will be contributing to moving real products with real impacts on rebuilding the economy rather than artificially stuffing a pillowcase with promisory notes. The deals that end up not going sour will far outweigh the repossesed cars from deadbeats and the total government losses for this bailout will be a mere fraction of what a direct cash injection to GM would cost.
To #185 John: I’m not an extreme fanboy of wind turbines, but I’d LOVE to have one in my back yard!
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November 13th, 2008 at 11:29 pm
GM website is hiring CPAs, actually lots of them, this clearly indicates they are secretly preparing for reorganization, even a possible chapter 11 filing.
http://www.gm.com/corporate/careers/jobsearch.jsp
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November 13th, 2008 at 11:30 pm
I don’t know if anyone is still up…or they read this far down a thread, but here is a silver bullet moment, that has gone virtually without report so far. Maybe it blows up tomorrow.
I touched on this just after Q3 dropped, but when GM gets too close to ‘the minimum’ cash level…the level where they can’t pay all their debts as a ongoing concern, they are at risk of a ‘run on the bank,’ (I figured at the time, and with the current cash burn that gave them around 27 days (from Nov 11th).
Today, after hours we got this:
————————————————
Insurers pull cover from GM and Ford suppliers
Troubled US carmakers General Motors and Ford Motor have been given a potentially devastating vote of no confidence by three big European credit insurers, which have removed cover from their suppliers.
The withdrawal of credit insurance – which covers suppliers against the risk of the car companies’ failing – has previously hastened the demise of a string of European companies, with suppliers to retailers and construction companies finding cover increasingly hard to come by.
Euler Hermes, Atradius and Coface, which control more than 80 per cent of the world’s credit insurance market, are refusing to write policies for suppliers trading with GM or Ford on credit.
GM and Ford are two of the biggest groups ever to be blacklisted. The cut-off of cover will primarily affect big operations in Europe, where the insurers do the bulk of business. US suppliers largely operate without insurance.
The move leaves three possible scenarios: GM and Ford can start paying upfront for goods; they can hope their suppliers will trade uninsured; or they could be unable to buy the parts they need for car production.
The insurers have risk assessors working closely with the companies and are party to details not released to the market.
http://www.ft.com/cms/s/0/ff28c908-b1ed-11dd-b97a-0000779fd18c.html
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This is basically the mark of death if you follow Euro bankruptcies.
GM already runs behind on payments 30-90 days, if suppliers go ‘cash only’ on them, it all ends….immediately (or at least when that first critical part runs out of inventory).
It is exactly the same scenario as GMAC is doing to some car dealers. They are calling their line of credit and demanding payment for old debt, plus not extended new credit for future purchases. The dealer basically has only one option, to pay for inventory up front…in cash. The dealers faced with these options go under…after all, they can’t get credit for a good reason.
/I affectionately coin this being ‘Bill Heard’ed.
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November 13th, 2008 at 11:33 pm
GM Stock is under $3 now, down from $93. It’s ratings from the “experts” is basically “sell, sell fast, and sell it all!”
Looks like it’s time for me to make another stock purchase…
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November 13th, 2008 at 11:49 pm
NO BAILOUT, I can’t believe some of the things some of you guys are saying, all these bailouts our government is doing won’t solve any problems, the problems will still be there. GM or Ford wont be selling a lot of cars in the future so a bailout wont do any good. The UAW contract must be renegotiated, the top ex’s contracts must be renegotiated and the government must forgive all corporate tax’s and bankruptcy is a realistic option, GM must down size, a bailout is a bridge to nowhere
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November 14th, 2008 at 12:00 am
Bankruptcy with new management, the severence of ridiculous union obligations, and the wiping out of debt is not necessarily a terrible thing for GM. Is it?
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November 14th, 2008 at 1:17 am
It may be all over if #188 Statik has good information, in which he always has, wow
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November 14th, 2008 at 1:25 am
Does the name of this site need to changed? Maybe a poll is needed for the answer…
GM-Death-Watch.com
GM-The-Titanic.com
If not, where are the threads on the Volt?
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November 14th, 2008 at 1:32 am
I still want my Volt Dangit!
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November 14th, 2008 at 1:33 am
Is it possible to buy the prototype?
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November 14th, 2008 at 1:43 am
It’s going to be a long cold winter and it may not warm up for several years. I’m wondering what Paulson’s next goofy move will be ?
What happened to the first 25 billion that went to GM, or was that used as chump change. And still the wars that we can not afford drag on.
And what happened to the bank loan that was supposed to get the credit markets moving again.
I can tell the banks are suffering these days, I only received 5 offers for credit cards in October.
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November 14th, 2008 at 1:57 am
#193 Jeff
This is the Volt site, we all want the Volt to make it, but it looks bad for GM and we are all worried.
I vote for the Volt
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November 14th, 2008 at 1:58 am
Toyota Needs to go out of business.
File for Chapter 11.
I am so tired of the Japanese car companies.
Sanyo limits the amount of batteries ford can use on there escape hybrids just so the Japanese can make more money here in the US.
All along not allowing us to sell cars in japan.
People are right. GM made large cars because every American family wanted them.
Dont use GM as your fall guy.
GM had nothing to do what American people wanted in their driveway.
GM is working hard to to make new vehicles.
Yes to GM bailout and our new president Obama
No to Bush he doesn’t support anything but Iraq and oil he wont even support our industry.
If we don’t have industry in the country we will be a very poor country. We are not in the housing business anymore if you lose auto manufacturing you lose the nation.
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November 14th, 2008 at 1:59 am
I voted no , because I think it would be easier to build something totally new (like the Volt) from scratch ….
My first thought was yes with conditions , but there’s always a way around any conditions … humans are good at this
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November 14th, 2008 at 2:09 am
I totally agree vote yes
So many anti American Toyota and Honda drivers here in this site.
People buy foreign cars now to be in style with the jones where GM products now are much better than Toyota products.
The new Malibu was rated much higher quality than the Camey.
But people still buy Toyota because they are anti American.
People need some patriotism and support out nations industry.
I agree with helping GM.
Whoever does not is Toyota PR spamming this site and people who are anti American can move to japan.
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November 14th, 2008 at 2:14 am
I love my GM is over 10 years old and it works great!!
I support GM
Why should we help the banks Wacovia didn’t even need the money they said.
GM should take some of the 700B from wacovia …they didn’t know what do do with the money and give it to GM
12 Billion a month in Iraq and we are saying no to GM
Are people here so dumb?
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November 14th, 2008 at 3:46 am
I for the life of me can’t understand why the American system has become so bad/corrupt.
There has to be a better capitalistc version – with laws in place tweaked as it appears people can’t play nice anymore.
1) Crazy health care funded by the employer – What the heck has ANY employer got to do with your health ? People should be independant free agents in a true democracy.
2) Pension /retirement fund – why haven’t emplyees got mandated goverment approved private funds that are independant of the employers so when they shrink – like GM they don’t carry an impossible burden?
3) Sack all those stupid big bussness lobyist – it’s clear in America that they aint doing any right thing for the country or the people only for their short term greedy little selves. This is NOT SOCIALISM just laws to get a truer MORAL CAPATIALISM which by the way is still the best sytem the worlds got. But we can see it needs rules to stop the weasles in society from sqewing the system to collapse.
4) Unions they screwed it and they were helped by GM to keep the status quo – now we all wear it. Bit late to show some common sence when the sky has already fallen (Too late).
American better get their act together as there is a lot to fix NOW.
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November 14th, 2008 at 4:11 am
Statik #188. This is indeed a major setback. The fall can now be measured in days, possibly weeks, for Europe. There’s no way the EC will intervene for a foreign company.
As far as the US goes, will this will affect the Saturn division, and lead to concern about US based suppliers and possible withdrawal of credit from them?
I see after 1014 votes the:
Yes with conditions, has 60% of the vote.
No, has 25% of the vote.
Yes, a mere 12%
Fence sitters 3%
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November 14th, 2008 at 4:20 am
And here’s the problem, at least for October 2008, year-on-year.
The Volkswagen Group (Volkswagen, Audi, Seat and Skoda), the market leader, saw its total Europe new car registrations drop 7.6% in October 2008 year-on year to 249,948 units. PSA Group, the number two OEM, saw registrations down 16.3% to 145,493 units. Ford, the number three, saw an 11.9% drop to 111,971 units.
The Renault Group suffered a 19.1% drop to 101,644 units; GM saw registrations down 25.2% to 94,479 units; and the Fiat Group saw a 7.9% decline to 93,952 units. BMW dropped 10.4% to 66,242 units; Daimler was down 16.6% to 61,754 units, and Toyota 23.6% to 54,612 units.
http://www.greencarcongress.com/2008/11/europe-passenge.html#more
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November 14th, 2008 at 5:06 am
I want to see their business plans . We are not children here and these companies are not any different than any other company either .
When I went to the banks for loans for one of my companies the first thing that the bank asked for was a comprehensive business plan. It had to be very complete and a good one to get just 100 thousand dollars , even less some times.
I want to know who drew up the current business plans , how does it compare to the one drawn up six months ago , what is the break even point , who is ultimately responsible , what are the guarantees of payment , what are the secured items , how much are they really worth , what is the time line , etc. I want to see all the information , don’t just tell me how much money you want , you are not a school girl who is going shopping with some girl friends after school.. This is serious business so act like serious business men. SHOW ME THE BUSINESS PLANS.
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November 14th, 2008 at 5:21 am
Maybe letting them fail is the way to save them.
This is the quote from UAW.com
“Congress should also act immediately, said Gettelfinger, to provide an additional $25 billion in loans so that auto companies can meet their health care obligations to more than 780,000 retirees and dependents”
read more at
http://www.uaw.org/news/newsarticle.cfm?ArtId=514
Obviously big chunk of that money is not going to be saving GM but will be paid out to UAW members. Why should UAW workers get paid when millions of small businesses are dying.
Volt will be symbolic new product for GM and for America and it should be given a chance to survive.
However Chevy Volt and other profitable or new products will not be able to support the GM unless GM is restructured.
Right now it looks like UAW and other GM creditors are like 80 year old Grandparents telling a newborn baby to get up and go to work to support them.
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November 14th, 2008 at 5:40 am
GM wants a loan…right?
How about 50,000 people “loaning” GM $36,100 each.
Then GM can repay each loan with a 2010 Volt.
The Federal Government will rebate $7500 to each buyer.
50,000 buyers x $36,100 per Volt = $1.8 billion
This will lead to long term revenue for GM generated by Volt service (Mr. Goodwrench) and options (On Star, solar panels, battery upgrade… ect).
_____________________________________
Or better yet. The Federal Government can order 50,000 Volt and sell directly for $29,000 each through Chevy dealerships. No money wasted on processing rebates.
=D~
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November 14th, 2008 at 5:56 am
Don’t worry Feds, you’ll be able to sell the 50,000 Volt.
http://garfwod.250free.com/Photos/Volt_back-seat.jpg
http://garfwod.250free.com/Photos/volt_red.jpg
=D~
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November 14th, 2008 at 6:17 am
Static #188
This is precisely why “standard” Chpt 11 was never an option. It’s either government backstop or Chpt 7. It could be gov backstop + Chpt 11 but there are a lot of “issues” with standard Chp 11 that would to be overcome. The most viable and efficient way would avoid full takeover by bankruptcy court. Most suppliers could not afford the time and expense it would take to get what optimistically would be $0.50 on the dollar. It would be great for the sagging legal industry, though. Only good if one is in favour of this. I’m not sure we have enough trees left to support GM Chpt 11 (or 7).
Amended necessary actions (be it Chpt 11 or government arbitured compromise):
-All “cards” are put on the table
-Not limits but significant reductions in go forward executive compensation
-Immediate implementation of future union concession with significant rework of retirement benefits (see company ownership)
-Negotiated payments of outstanding debt to suppliers (80% – 90%)
-Significant reduction or elimination of any severance packages to all former executives that had been earning greater than $250k in compensation annually
-Immediate Government operational loans to assuage credits fears and supplier risk
-Accelerated release of already approved $25B retooling money
-All current stockholders and option holders are wiped out
-GM is converted to an ESOP with partial ownership by a UAW-GM pension fund and white collar workers. (I know. I know. Some think the unions have been the sole demise of GM. I definitely agree they have been a major contributor but they are, I believe, the largest credit holder. A union ownership position would align their interests more directly with the company’s profitability)
-New “owners” elect a new board of directors
Since