Nov 20

Automaker Loans Deferred to December and Will Only be Provided Based on Automakers Plans for Viability, GM Agrees

 

Congressional leaders from the House and Senate today gave a press conference on the how they plan to move forward with the Detroit 3 bailout.

The congressional leaders indicated they are unanimously committed to helping the automakers, in a non-partisan way, but not immediately, and on conditions.

The leaders said GM, Chrysler, and Ford would have to provide congress with detailed plans on how they would use loan money in order to achieve future financial viability, stability, and profitability.

Those plans have to be submitted by December 2nd and will be reviewed and decided upon by the Congress, with funds being issued immediately upon approval. Congress will reconvene for this after Thanksgiving.

There will be taxpayer protection and equity. The funds will come from the retooling loan provisions, but not take away from those loans. Instead the money will come from that fund called section 136 and what is left will still be used for retooling. Furthermore stock will be held by the government and when sold back to the automakers at a profit (hopefully), it will go back into those funds.

Lawmakers indicated there is a significant risk in delaying this, but stated that if there is an emergency prior to December 8th, Pauslon and the administration will have the authority to use the TARP funds to give an emergency infusion. Paulson and the Bush administration though have clearly stated they did not feel the TARP funds were appropriate for the automakers.

The plan also stipulates strong congressional oversight once the loans are made.

House Speaker Nancy Pelosi summarized the plan in the following way “Until we see the plan…we cannot show them the money.”

GM spokesperson Greg Martin has issued the following statement in response:

We appreciate the Congress’ recognition of the auto industry’s vital contribution to the nation’s economic strength and national security. We intend to deliver a plan to Congress that shows them a viable General Motors. We agree completely that there must be accountability to U.S. taxpayers for government support that enables automakers to continue their restructuring and to ensure a stronger, more competitive auto industry. We will continue to work vigorously with the Congress and the Administration during the next few weeks to address their concerns and to arrive at a solution that provides immediate aid to the auto industry.

This entry was posted on Thursday, November 20th, 2008 at 3:48 pm and is filed under Financial, Politics. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

COMMENTS: 97


  1. 1
    Tom

     

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    Nov 20th, 2008 (3:52 pm)

    What plan did the banks show congress????????


  2. 2
    Frank D

     

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    Nov 20th, 2008 (3:55 pm)

    It’s time for Rick Wagner to submit a long term plan that revolves around the Volt, and the shedding of the many redundant brands. Both sides of Congress need to know with great detail, the importance and benefit the Volt will have.


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    Jim D

     

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    Nov 20th, 2008 (3:55 pm)

    I would say it is rediculous for executives of this calibre to go to congress and expect to receive billions without a visible plan.


  4. 4
    DB Cooper

     

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    Nov 20th, 2008 (3:58 pm)

    What are the Dem’s doing here ? There’s no way they can come up with a plan that looks viable for anything more than life support, unless the business plan throws the UAW legacy costs under the bus… Then that plan will be promptly shot down since it will offend the D party.

    This is a no win situation. The D’s just shot themselves in the foot. Their best strategy here was to keep the big 3 on life support long enough for Obama to roll in and support the union.

    Am I just missing the liberal logic here ? Or did someone skip their dose of Kool aid today ?

    They can’t downsize radically to cut their losses; since they’ll have to keep paying for all that labor whether they’re building anything or not…


  5. 5
    brad

     

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    Nov 20th, 2008 (3:59 pm)

    Heres a plan:

    Lyle Dennis will take over GM and provide a Volt for every American in return for the funds.


  6. 6
    Schmeltz

     

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    Nov 20th, 2008 (4:00 pm)

    And so it goes…On and On and On and …


  7. 7
    Jim D

     

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    Nov 20th, 2008 (4:02 pm)

    will Lyle be getting 50M per year and a corporate jet?

    when do I get my volt?


  8. 8
    Brian M

     

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    Nov 20th, 2008 (4:05 pm)

    I think a good start would be consolidating brands…. GM really only needs 2 or 3 brands instead of 8. They could get by with Chevy (large cars, SUVs, trucks), Cadillac (luxury sedans and SUVs), and Saturn (small cars, maybe a minivan).

    Sell Saab and Hummer, transfer Buick to China, and fold up GMC and Pontiac. Maybe even spin off Corvette as its own brand and sell it.


  9. 9
    Evil Conservative

     

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    Nov 20th, 2008 (4:05 pm)

    Like sticking a finger in a dyke and expecting no other leaks. This loan will not fix anything unless the UAW goes.

    By the way where is my bailout? I could use a business loan at 0 – 2 % interest too.


  10. 10
    MarkinWI

     

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    Nov 20th, 2008 (4:06 pm)

    If flying into Washington on a private jet was so dang important (not), then Wagoner needs to DRIVE to D.C. in December in a Volt mule. What a statement THAT would be. And here will be the ultimate irony: GM killed the electric car, and now the electric car will save GM.


  11. 11
    Tim

     

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    Nov 20th, 2008 (4:09 pm)

    This is going to get messy…


  12. 12
    Bob McGovern

     

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    Nov 20th, 2008 (4:10 pm)

    Sounds like something from a lawyers office.
    ———————————————————–
    There will be taxpayer protection and equity. The funds will come from the retooling loan provisions, but not take away from those loans. Instead the money will come from that fund called section 136 and what is left will still be used for retooling. Furthermore stock will be held by the government and when sold back to the automakers at a profit (hopefully), it will go back into those funds.

    ———————————————————————–
    This came from above. What are they saying? So for a while GM will be Government Motors until General Motors buys back their stock.


  13. 13
    Mark Bartosik

     

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    Nov 20th, 2008 (4:14 pm)

    Senator Kit Bond says that selling corporate Jets should be in the viability plan.

    If your teacher gives you a tip on what to include in your homework you had better follow their advice!


  14. 14
    statik

     

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    Nov 20th, 2008 (4:17 pm)

    Dang, I just posted on almost the same thing in the last thread, I didn’t know this one was here…I’m feeling lazy, so I’m cutting and pasting it:
    (now featuring correct spelling and grammar and a extra editorial bit)
    ———————————————-

    I think it is a deal in any real sense. It is pretty hard to come out with a plan in the afternoon and pass it by supper…this is the government here. So, they figure they can’t push it out until they come back (especially with Reid busy eating humble pie and all), so why not ask for a plan in the meantime?

    Can you just imagine Congress sitting down for a quickie vote in a couple weeks, then having GM, Ford and Chrysler each dump the ‘encyclopedia britannica’ of a turnaround plan on their desks to sift through? Anyway, who makes the decision on the merits of these plans, what happens if any of the 3 are not adequate? They are done? Or if one messes the plan up..do they all lose? I don’t buy it.

    I have doubts that any of them could put together any coherent short term ‘turnaaround’ plan to make money and not be back begging for more in a few months (or could be reasonably expected to by anyone). Heck, I don’t think Toyota could present a plan to not lose money in 2009.

    So what are they asking for…other than a pound of flesh? Probably something to throw back in the Big 2.8’s faces when Jan 20th rolls around and they all hobble back. I think you’ll find the Dems sing a different tune on the whole matter of ‘the importance of Detroit auto’ when it is their political necks they are risking.

    Problem of course will all of this, is that GM will be hard pressed to make it until the vote goes through -AND- then having to wait for the money to be dispersed once it is passed. It is not impossible to foresee them crossing the bridge, but it will be a fun trip across. I’m sure we will have lots of panic reports from GM over the next few days, while Ford and Chrysler quietly draft their plans, letting GM bang their fists on the table and wave their arms in the air looking for the cash.

    Good time to take a stab at amount they probably will request don’t you think? Not going to have much else to talk about from here on out for awhile (I wish there was a cutting edge car or something to discuss while we pass the time waiting). This is of course just a WAG on the numbers, with nothing to back it up…just spit-balling for laughs.

    GM: 11-12 billion
    Ford: 9-10 billion
    Chrysler: 7 billion

    (I’m sure the second it goes through, the Chrysler/GM merger is reborn…if not sooner).


  15. 15
    JimGalaxy

     

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    Nov 20th, 2008 (4:20 pm)

    *head spinning* .. so .. Congress will provide loans (operations funds).. from the Loan (retooling funds)? And then the loans will have to be repaid to the Loan, so that the Loan will still be the Loan?


  16. 16
    George K

     

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    Nov 20th, 2008 (4:35 pm)

    Finally they will have to present a 5 yr Cash Flow Analysis. The key will be, at what level they are “projecting” car sales to be.

    What happens when it gets out that they plan to sell the XYZ lines in order to reflect lower projected sales?

    Obviously, this can’t work unless they show massive cuts.

    Oh boy. Me thinks it time for Lutz to take over.


  17. 17
    Morgan

     

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    Nov 20th, 2008 (4:42 pm)

    17 Statik:

    Im not sure….it is possible.

    spit balling but:

    1) GM will ask the Government to kick in the final lump sum payment to the UAW for the 2010 plan

    2) Dealer contracts are still an issue RE: ditching brands.

    3) Spinoffs? Each brand at GM still functions, more or less, as their own seperate companies. Saturn, GMC, Pontiac seem like prime companies for them to “spin off”

    4) UAW concession on layoffs and plant shutdowns…biggest drain on GM right now is excess capacity.

    5) obvious is drastic executive pay cuts and retiree benefit cuts


  18. 18
    Rick C

     

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    Nov 20th, 2008 (4:51 pm)

    GM has a lot to answer for to be sure. They destroyed public transit in the ’30s and the 40’s and they have continually opposed, everything from safety glass for windshields, safety belts, airbags, the catalytic converter, they turned their back on a car that could get 80 MPG even though the government paid $1 Billion for the R&D, and finally zero emissions vehicles which, in effect, means electric cars like the EV-1. This time however GM has the Volt. If GM files for chapter 11 it will likely be the end for them and the Volt. People when they are surveyed say they would not buy a car from a company in chapter 11.

    So GM must be saved if the Volt is to move ahead. The conditions for the loan/bailout should be:

    1 All board members, especially CEO Rick Waggoner who killed the EV-1 and Bob Lutz, have to go and be replaced by those dedicated to plug-ins. Chelsea Sexton who successfully marketed the EV-1 in Southern California would be my personal favorite for CEO of GM.

    2 The monies spent go towards retooling the factories to primarily build electric cars like the Volt and high mileage cars like the Cruze.

    3 They must submit quarterly audits to the appropriate Congressional committee. Ways and Means? Energy?

    4 Excess funds are to be reinvested in lowering the auto makers’ energy consumption in the manufacturing process.

    5 NO MORE GAS HOGS! The days of these monsters are over! Build enough for farmers and industry and market the smaller cars for commuters. I get sick and tired of seeing these behemoths with only one person in them.

    It’s also important to remember that it wasn’t only the U.S. automakers who built these lumbering behemoth trucks and SUVs. Toyota, the auto maker with the fallen green halo is slowing down production of its Toyota Tundra monster truck plant here in San Antonio. They have also stated that they do not plan to build a plug-in hybrid and have talked down GM’s progress on the Chevy Volt.


  19. 19
    solo

     

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    Nov 20th, 2008 (4:53 pm)

    Listening to the news yesterday, they said GM (or any carmaker), cannot ditch brands because of all the lawsuits from all 50 states from each dealer. It cost GM and Chrysler almost 1 million per dealership when they quit making Olds and Plymouth. The government needs to address this and provide a federal law that allows the makers to scrap these brands and possible any dealer they feel is not viable, without the overhead of that dealership taking the automaker to court.

    As far as the carmakers coming back in 2 weeks with a business plan, they should have showed up with one in the first place.

    The plan better include a salary cap with only 6 figures for ALL board positions and pretty pictures from EBAY showing all the cool Jets for sale.

    Is Lee still alive? We need him badly.


  20. 20
    noel park

     

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    Nov 20th, 2008 (4:55 pm)

    Does anybody think that these “business plans” are going to be anything other than eyewash and spin? They could get rid of Rick, Bob, and however many more layers of overpaid management, dump the jets, throw the retirees under the bus (with apologies to DB Cooper), dump the payments for being laid off, and still not save enough money to be “viable” if they don’t have any cars people want to buy.

    And how can they do this stuff without getting sued and/or struck by the UAW?

    Maybe, if the Volt and the Cruze were coming out tomorrow, one could see a glimmer of hope, but they’re two years away. The way these guys work 2010 might as well be 2110. Sorry to be so negative, but it’s hard to see the end of this.

    In yesterday’s local paper there was an article about Toyota, Nissan, and Mercedes hunting around the ports of Los Angeles and Long Beach looking for land to rent to park cars they can’t sell.

    On the other hand, I heard on the radio this AM that Honda reports that it can’t build Fits fast enough to keep up with the demand.

    Where will it all end?


  21. 21
    N Riley

     

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    Nov 20th, 2008 (4:56 pm)

    I hope all three companies can submit a plan that will show how they intend to get rid of the fat and restructure in a way to be competitive in today’s vehicle market around the world. There must be plans to cut car lines, close plants, cut expenses at the top as well as through to the bottom. Every automaker employee should feel the pinch. They must understand that the American people can not allow the same old song and dance time after time.


  22. 22
    DonC

     

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    Nov 20th, 2008 (5:00 pm)

    #4 DB Cooper – “What are the Dem’s doing here ? There’s no way they can come up with a plan that looks viable for anything more than life support, unless the business plan throws the UAW legacy costs under the bus… Then that plan will be promptly shot down since it will offend the D party.”

    Well put. However, a lot of democrats are not big union supporters. My sense is that they’re looking for some UAW give-ups and some whacking of things like the corporate jets. I found it interesting Levin was pretty agitated that Reid wouldn’t send the compromise up for a vote.

    #14 Statik

    Sometimes things work out. My sense is that the UAW and the auto companies have been in this dance where the concessions are just enough to keep the companies breathing but not large enough to give them enough space to thrive. Reminds me of the Japanese response to their financial meltdown! 🙂

    At some point the UAW has to understand that a death by a thousand cuts is not pleasant, that the workers would be better off taking a single large hit and being done with it, and that retirees can’t have all the goodies they’ve been promised. (The idea the federal government will pick up health care for a subset of workers that exceeds Medicare and Medicaid is crazy).


  23. 23
    N Riley

     

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    Nov 20th, 2008 (5:00 pm)

    If this “plan” is truly bipartisan, where were the Republicans in the above picture? Did the Democrats actually get the Republicans to agree and then run to the media for a photo-opt that excluded their Republican “partners” in this plan? Doesn’t sound like a way to build lasting support. The Democrats have played this for as much political gain as they can. It now time to stop it. Both sides need to work together and come to the television cameras together to present their case to the American people together.


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    jefro

     

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    Nov 20th, 2008 (5:02 pm)

    The really sad part is that UAW workers demanded and got things like health care and retirement benefits. They brought up wages for the rest of the country. Only a few other ambitious workers demanded that from their bosses.

    Why don’t the lazy sob’s in the rest of American demand a basic wage?

    To make things worse, when TBT (the big three) had ton’s of cash they give it to every exec on the spot. Millions to each from the 50’s to today. While at contract time they told the average worker they could get their share when they retire. Well, now they are retired and want their share. Woppps. TBT spend it!

    I still don’t get it. 700 Billion overnight to AIG and the like. Months for 25 Billion to companies that employ many more people. TBT at least could be used to build defense goods. Can’t throw an insurance policy at any enemy!


  25. 25
    omnimoeish

     

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    Nov 20th, 2008 (5:05 pm)

    Being forced to wow Congress with a turnaround plan is good news for us Volt fans because GM knows that Congress will love hearing about how they are in the midst of developing the most importance piece of technology our country has invented since the telephone. A car that holds the potential to give us total oil independence. If every car in the country could go 40 miles without gas and then get 50 mpg after that, we would easily be able to come up with enough American oil for many decades.

    It will give GM all the more reason to talk up the Volt, which will in turn keep the fire under their behinds to keep R & D $$ flowing into the project to make it as quickly (and hopefully reliably) as possible.


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    bill freeleng

     

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    Nov 20th, 2008 (5:05 pm)

    Why cut all the brands if they are selling and making money that makes no sense.

    Shrinking GM is not the answer totally. Only get rid of what is not selling and making a profit.

    Hummer is the best choice.

    Buick is doing OK and its quality is better than Lexus read.

    Pontiac makes the sporty cars so that needs to stay.

    GM has done a good job not cloning vehicles like it use too as well. Something Toyota still does with its Lexus Camry’s


  27. 27
    dc

     

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    Nov 20th, 2008 (5:07 pm)

    This is a band aid and nothing more. Good grief we are still what 24+ months away from the Volt being a production reality. Do the math!

    $12B for GM burning $5-6B a month does nothing for them in the long term unless MAJOR changes are made.


  28. 28
    Koz

     

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    Nov 20th, 2008 (5:10 pm)

    DB Cooper #4

    Get your head out of your A and you will realize that not everyone distills the world into D vs R BS. We need another world to send everyone with this limited vision to so that they can fight amongst themselves and not F this one up any more for the rest of us!


  29. 29
    Ziv

     

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    Nov 20th, 2008 (5:12 pm)

    I am fairly happy to see this happen, if only because it will probably allow GM to survive into 2010 so we can see if the deal cut with the UAW will be sufficient to bring it back to something close to profitibility. And, hopefully, to production of the Volt by an American owned corporation, instead of Dubai Wealth Fund/General Motors. The whole principle rankles though. Mulally, Wagner and Nardelli should be working for a dollar a year like Iaccoca did, until the loans are paid back. And the corporate jets should be sold immediately, First Class isn’t good enough for an American CEO but it is for the asian CEO’s? Now if I hear about Watanabe flying in his own corporate jet, I have to say, yeah, but Toyota is making money, not losing it… If the american CEO’s take a bite out of this s*** sandwich, it should be part of the agreement that congress enacts that the UAW has to take a bite as well, i.e. start the reduced benefits package for Detroit workers 12 months, or even 8 months early. And these sweet heart loans should be contingent upon the Big 3 producing more cars like the Volt and the Fusion Hybrid, not selling 10,000 a year and featuring them in ads, despite the fact that noone can actually buy one without a huge markup over MSRP.
    Detroit is the one begging for a favor here, and they had better work for the loans they are going to get.


  30. 30
    Cautious Fan

     

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    Nov 20th, 2008 (5:13 pm)

    “The funds will come from the retooling loan provisions, but not take away from those loans.”———-OK. Which double jointed accountant escaped from yoga lessons and came up with that.

    Weren’t the EREV subsidies coming from that $25,000,000,000? And wasn’t some of the Volt plant going to be constructed from those funds as well. So….won’t this harm the Volt?


  31. 31
    vincent

     

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    Nov 20th, 2008 (5:14 pm)

    $20K a pop for each out of touch with reality CEO to fly to DC. Each CEO came from the same town…and can not even share a private Jet?

    These guys can turn it around…NOT!

    They could have saved $40K that day!


  32. 32
    Rick C

     

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    Nov 20th, 2008 (5:15 pm)

    # 22 DonC,

    The UAW has taken the hit since the 1980’s. Flint, Michigan used to employ 80,000 workers when Roger Smith decided to lay them…., excuse me, ‘downsize’ them back in the 80’s. Back in those days the workforce was reduced by 30,000 down to 50,000 workers. Today it’s down to 12,000 workers. The rest of the jobs are in ‘right to work’ states’ in the south or mostly in Mexico, Brazil and, it was just announced today, that GM is building a plant in Russia to make more SUVs of all things. The UAW has taken a lump sum of money from GM and agreed to assuming pensions of its retirees. The UAW has given back on health benefits for new employees and agreed to lower wages for new hires.

    So let’s start some cutting at the top this time. How about selling those private Lear jets they used to go tin cup in hand to Washington on their begathon for starters.

    http://money.cnn.com/galleries/2008/autos/0811/gallery.autos_crisis_causes/5.html


  33. 33
    DB Cooper

     

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    Nov 20th, 2008 (5:16 pm)

    (Daily) Koz #28

    I personally don’t care for political parties at all. My only point was that there is probably no way the big three can even plan on existing until the 2010 labor agreement kicks in, without severely offending the UAW (which is and has always been a very blue shade of blue politically). The UAW’s central role in this makes the political D & R stuff unavoidable.

    Besides, the congress almost always votes straight down party lines. Getting any action on this while keeping the union happy simply has a much better chance post-January. But the patients need life support to get that far.

    Also, cutting executive pay is a MUST. It won’t actually save a lot of money percentage-wise, but it has to happen in order to show that they mean business. $1 per year would be appropriate.


  34. 34
    Adrian

     

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    Nov 20th, 2008 (5:27 pm)

    I don’t think D v R, but the politicians think that way… which the main issue here. The D will shove whatever they can through because they hold power over R in the house, senate and white house next year. This should teach the voting public to think a little bit more before you vote.

    All three car companies need help restoring car quality and public trust in them. 25 billion won’t do it. I would never buy Chrysler, and would think over a few Ford trucks (and Mazda). GM needs to take this chance to reboot the brand. No more Azteks, sport car with front wheel drive, lame interior design and quality, and most importantly build the Volt and get out in front of next generation fuel vehicles (not just in engineering, but in the public eye).


  35. 35
    M1EK

     

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    Nov 20th, 2008 (5:39 pm)

    “It’s also important to remember that it wasn’t only the U.S. automakers who built these lumbering behemoth trucks and SUVs. Toyota, the auto maker with the fallen green halo is slowing down production of its Toyota Tundra monster truck plant here in San Antonio. They have also stated that they do not plan to build a plug-in hybrid and have talked down GM’s progress on the Chevy Volt.”

    More crap from denialists.

    Honda and Toyota didn’t fight CAFE kicking and screaming and getting loopholes for awful SUVs and pickup trucks. Toyota sells trucks to those who want them, sure, but hasn’t tried to create the market from those who didn’t want them and never needed them.

    As for talking down the Volt, they’ve sold a million Prii. Even if the Volt was an obvious success, talking down the Volt to sell the Prius isn’t damaging to the economy, the environment, or our national security the way it was when GM spent years talking down hybrids so they could continue to sell polluting inefficient SUVs.

    GM needs to die in a fire. Yesterday.


  36. 36
    DB Cooper

     

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    Nov 20th, 2008 (5:42 pm)

    Adrian #34 –

    You don’t like GM’s interiors ? The interior feel has always been one of my favorite things about my GM cars. IMO the ’95 Buick Riviera had an absolutely perfect interior. Of course, I have never owned anything newer than a ’95… so maybe that’s changed.


  37. 37
    Mark Z

     

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    Nov 20th, 2008 (6:10 pm)

    President Elect Barack Obama spoke to the Detroit Economic Club on May 7, 2007. What he said that day provides a foundation on how GM will be saved in his administration.

    “We all know the statistic – health care costs currently account for $1,500 of every GM Car. So here’s the deal. We’ll help to partially defray those health care costs, but only if the manufacturers are willing to invest the savings right back into the production of more fuel-efficient cars and trucks.”

    The complete text is a breath of fresh air with all the negative news this past week. I hope GM will study the text to aid them in their plan to congress after Thanksgiving.

    http://en.wikisource.org/wiki/Remarks_of_Senator_Barack_Obama_to_the_Detroit_Economic_Club


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    Frank D

     

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    Nov 20th, 2008 (6:13 pm)

    The E-Flex platform is GM’s future. Rick Wagner must give the performance of his life to Congress December 2nd. He must also put Healthcare reform in the spotlight for Congress to tackle and give them and every other big business a marketable edge globally. Thats the reality. Our years of defending oil and the high costs, must be re-allocated to benefit more Americans and our quality of life.


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    Dave K.

     

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    Nov 20th, 2008 (6:21 pm)

    $25,000,000,000 / 300,000 laid off workers = $83,300 per worker

    The incentive to build economic cars (Volt credit fund) has now been wagered on the thought that the big three will REPENT and get things going North again.

    Truth is, we will need restructuring of the big 3 by the next quarter. With the Volt rebate fund and what could have been laid off workers compensation money having been ‘burned’. Let’s rename it the corporate jet fuel fund.

    Can we just get on with the mild restructuring and have a chance for American manufacturing to survive? Hand pick the finest employees to remain. The rest will get minimal government help and need to start looking for work.

    =D~


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    Frank D

     

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    Nov 20th, 2008 (6:30 pm)

    #37 Mark Z Thanks for the post. It’s encouraging to read those words from our next President. I just hope GM can make it till January 20th.


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    noel park

     

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    Nov 20th, 2008 (6:31 pm)

    #37 Mark Z:

    Yeah, that is a breath of fresh air. God send that it shall be true.

    Thanks.


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    Casey

     

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    Nov 20th, 2008 (6:35 pm)

    Why don’t the unions agree to make cuts now instead of 2010, if they want to save their jobs and save their companies, they need to get serious about it. After watching Rick Wagoner in the congress for three days its pretty obvious why GM failed,

    the UAW is not going to make reductions and the CEOs are not going to either, so the only way we are going to save the Volt is for GM to go into chapter 11

    And even if they do go into chapter 11 Obama has said he will save the auto manufacture (unions) at all cost when he gets in office


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    whynot

     

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    Nov 20th, 2008 (6:39 pm)

    Just as a point.

    What makes politicians, most of whom have not worked in business, in a government that is multiple trillions in debt think they have the skill to evaluate a plan for future financial stability? if people could accurately predict future business conditions, we wouldn’t have this situation.

    This sounds much more like a way to make the bailout sound good for the media than anything that actually means anything.


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    mikeinatl.

     

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    Nov 20th, 2008 (6:53 pm)

    The Unions should also be required to submit their plan to Congress. They are a critical element in the solution.

    It would be a fantastic time for them to step up and say, “We will help save the US auto industry” instead of just standing there with their hands out. Talk about positive PR for the UAW!

    And then back it up by making serious concessions. On their own, without being forced into it.

    I know. Really nutty idea.


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    Dave K.

     

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    Nov 20th, 2008 (7:05 pm)

    Has anyone here worked at a shop or at a company or at a business where there were a few people that didn’t belong there? Maybe a drug addict, or the guy who says his back will be feeling better when he gets his meds? Remember the coworker who didn’t have the strength to loosen that stuck part and the two others who were called away from their work to assist? Remember that hot head who kept doing stupid things and ending up getting compensation for job related injuries?

    Well, GM, Ford, and Chrysler don’t have any of these people on their payroll. All their employees are the best in America and need to be retained for 30 years. Or a least long enough to be eligible for retirement pay.

    _________________________

    Let’s not call it restructuring. Let’s cal it a slim down program. It’s a health program for an over weight drunkard. A man who’s hearing has never been that great.

    Q> How many GM employees does it take to change a burnt light bulb?

    A> Three, one to screw the new bulb in. And two to talk about how good the old one was.

    =D~


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    Nov 20th, 2008 (7:09 pm)

    #44 mikeinati:

    Not nutty at all, IMHO. Something like that has to happen or everybody will be out in the cold. I just hope that they can all figure it out before it’s too late.

    How about a joint plan among the manufacturers and the UAW?


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    Nov 20th, 2008 (7:12 pm)

    #45 Dave K.:

    You don’t have to look any further than my favorite managment textbook, “The Dilbert Principle”.

    “Rightsizing”.


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    Rick C

     

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    Nov 20th, 2008 (7:18 pm)

    # 44 mkeinati:

    The UAW doesn’t manage GM. The board of directors and the managers under them do. It wasn’t the UAW that decided to build large hulking SUV’s, trucks and the poster child of poor fuel economy The Hummer.

    As I have posted previously. The UAW has seen its numbers plummet from an all time high of 80,000 employees in Flint, Michigan down to 12,000 today. The rest of those jobs went to ‘right to work states’ where there are no unions or they are very weak, to Mexico where you are murdered if you try to form an independent union, Brazil and now Russia. They have agreed to pay cuts for all new hires. They have assumed the cost of their pensioners’ health benefits. Meanwhile Wagoner and the other board members keep getting richer. They even had the nerve to fly on private jets costing $20,000 to ask for the taxpayers to bail them out of their stupid decisions to walk away from hybrids 7 years ago so that Toyota and Honda could take up the market. The UAW didn’t decide to crush the EV-1. That was a management decision. The UAW has given whenever asked. It’s time for management to offer up its pound of flesh now.


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    Nov 20th, 2008 (7:25 pm)

    DB Cooper & Adrian,

    I agree completely about the politicians but that’s no excuse for the rest of us to behave likewise. If they won’t lead by example then we should. They will follow. (stepping down from my soap box koz the day is done)

    Everyone is soo right. They should have come with a plan and that plan should have included: executive pay of 6 figures or less, accelleration/implementation of UAW 2010 agreements with GM, and downsizing. This is too obvious and the way this whole theater played out it makes you go hmmmm. Where they that dense or was there some “other” plan. Perhaps the executives’ friends in Washington orchestrated this encounter so that the $25B could come from the retooling loans without strings. Or perhaps it was a play to get more leverage against the unions. Looking back on the whole “drama”, it just seems too staged to me.

    In the end, as long as congress sticks to their guns and the automakers come up with reasonable plans and the proper attitude then it won’t really matter. The plans may or may not include some form of negotiated, government assisted C11. Sufficient restructuring is the end that must be acheived.

    When they come back, be wary of claims of breaking even or profiting in ’09. Any claims of this and they should be sent packing. The bull needs to be stripped out of this process. The executives need to be contrite, open, and realistic. There will undoubtedly be losses in ’09 and break even for ’10, and profitability beginning in ’11.


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    Red HHR

     

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    Nov 20th, 2008 (7:28 pm)

    I bought gas for a $1.98 today. Where does that leave the Volt? Every time we start to go alternative the price of oil goes down. It makes it hard for economic justification for the alternatives. I was thinking that if the big three go under there would be less depreciation of the existing domestic fleet. Just a small bright side.

    With all the time we have spent on economics, when we get back to the Volt leaks, we should have some major progress! GM does make some good cars, if only people noticed.

    Red HHR (with change back from a twenty!)


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    Nov 20th, 2008 (7:37 pm)

    Typical Political hypocrisy! I watched most of the senate hearings. Nearly every topic could be turned back on the pious senators and a parallel made with their own mismanagement. There was no mention of the governments failure to balance a budget or level the playing field on trade. No mention made of big congressional retirements for short periods of employment, or other entitlements like indexed SS and Medicare that will bankrupt the system. Or mismanaged oversight of financial regulations allowed a collapse of credit that caught the auto companies. We did not hear any congressman volunteering to take $1 a year salary until the budget is balance or volunteering to give up his position if it is not balanced. The list could go on and on.

    What congress will get from the auto companies will be promises that will be more likely to be implemented than 98% of the promises we heard from the politicians in recent election. At least probably made with more sincerity and belief that they will follow thru on them. I certainly would not object to the auto companies taking the stand that the US Government owes them some trade laws that reflect the same policies back on each country exporting cars and auto parts to this country that they put on our imports to their country. Whats wrong with balanced free trade with a duty on excesses.


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    Nov 20th, 2008 (7:53 pm)

    Actual Plans:

    1) Launch Production Volt by November, 2009
    2) Cut executive (and management) compensation so No One has a salary in excess of $2m. per year.
    3) Shed unprofitable brands to the highest bidder immediately.
    4) Ask the Union for more concessions (as well as retirees (like those that do not need health care or those that can go on Medicare or Medicaid)
    5) Start revamping the industry to catch-up with the times (ie selling cars via the Internet like Tesla), closing down dealerships and service centers regionalizing them as best they can.


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    Nov 20th, 2008 (7:53 pm)

    I agree with Xzion where was the accountability in the 700 billion ripoff for the banks who were supposed to loan out the money but are either sitting on it or buying up assets of other institutions. WE NEED A THIRD OR FOURTH PARTY. Republicans or Democrats no action just smile for the camera and spout the standard buzz words, just sit by and every day watch the stock market drop another 400 to 700 points we are well on our way to becoming a banna republic. We should offer to drive the CEOs to the next get together with congress that way they cant bitch about them flying on a corporate jet. I have to go and puke now I cant stomach anymore of these arrogant politicians.


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    Nov 20th, 2008 (8:00 pm)

    #31 Ric C – “The UAW has taken the hit since the 1980’s …. So let’s start some cutting at the top this time.”

    I understand the sentiments and yes, the auto makers should look at the top. Seems like the corporate jets need to go along with the private dining rooms. And I have to say it seems odd that Waggoner made more than the top five executives at Honda Motors last year given the performance of their respective companies. Personally I think he needs to go. He’s just been living in GM land too long.

    I also understand about the shrinking number of jobs. What I’m saying has to happen is that the auto makers need to get in front of the problem. They have to cut health care benefits to retirees and use that money for new product development. They can’t keep cutting just enough to stay somewhat competitive but not cutting enough to get really healthy. If they don’t you’ll just continue to see more job losses.

    It’s time for more radical movement. Keeping the health care benefits for retirees sounds nice and decent but the end result will be that GM will go away, the health benefits will go away, the pensions will go away, and all the jobs will go away. It’s a hard choice but seeing which is the right choice doesn’t seem that difficult.


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    Nov 20th, 2008 (8:02 pm)

    I don’t know. I’m happy some sort of agreement has finally been established, but I’m still iffy on the fact that the money is coming from the $25 Billion retooling funds. It doesn’t seem completely fair and its kind of “backwards-thinking”.

    I really like how Ms. Pelosi put it: Show us a plan-then we’ll show you the money. That was perfect.


  56. 56
    WarrenPeace

     

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    Nov 20th, 2008 (8:03 pm)

    Tell me again why the Union still has to be involved?
    I have seen union employees work doing mindless thing. Their jobs are basically putting together Lego’s (Thanks to the Engineers). All they had to do was take an already assembled part that came from Mexico and snap it onto another piece, plug in the molex electrical connector then push into place on the side door till it “clicks” in place. That’s all they did for 9 hrs (1hr lunch). And tell me is that worth $26/hr? That is not a career. One person already wrote, if you want a career get the education and get the job for it. I said it before, a high school student can do this for minimum wage. Better yet, a struggling college student using it as a “stepping stone” to his education goals can do it for minimum wage.
    Many other jobs are just like that. Gantry robots carry the heavy pieces and electronic controls move it to your “Unit”. You guide your part close, then you use power tools to bolt them in. Yes there are nothing but power tools. All the employee has to do is place the power tool on the bolt and press the switch to torque the bolt in place.
    Wow, doesn’t sound difficult at all but their pay makes it “Sound” difficult.
    So tell me again why the Union needs to be in the manufacturing workplace?


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    Dave K.

     

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    Nov 20th, 2008 (8:04 pm)

    hi Red HHR #50,

    “I bought gas for a $1.98 today. Where does that leave the Volt?”
    ___________________________

    Honda announced that they can’t produce enough Fit cars to meet U.S. demand. This announcement wasn’t made at $4 per gallon for pump gas. It was made at $2.15 per gallon just last week.

    American’s are whores. We will buy from who ever offers the best price on an item. This is a truth we can’t deny. The upcoming generation of American’s have never driven muscle cars. They have driven Civics, Century’s, Focus, scooters and bicycles. They don’t have the old school desire to slide onto a front bench seat, grab onto a wheel, and smoke the tires with 400 hemi encouraged horse power. It’s not a part of their culture.

    The new generation wants technology. They want efficiency and expandability. They want something different from what their Dad wanted.
    ___________________________

    If the Cruze, Volt, and plug in Vue were on delivery trucks TODAY. We wouldn’t be saying the ‘B’ word. We would be watching GM stock race up to double digits. Someone will bring the Volt to market. It wouldn’t be a surprise if a restructured AGM (American Government Motors) went into mass production of E-REV in 2010. With AGM workers getting medical coverage through AGM (American Government Medical). This is a good fit for the Obama plan.

    Any takers? Yes we can?

    =D~


  58. 58
    Brian

     

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    Nov 20th, 2008 (8:11 pm)

    MARKZ, thanks for the post. That is an actual plan!! What is so hard about that.

    What is missing in this whole discussion is that the auto industry has to be a big part of getting us off our dependency on foreign oil. Much like the Obama’s speech, GM’s proposal has to include strategies that help us get off foreign oil. Then Obama has to challenge the american people to do their part. Buy the efficient american cars that are built.
    As for the Volt, GM needs to get it out faster. If they can’t sell them until 2010, they should start leasing them in the fall of 2009. That will go a long way towards demonstrating that they will be available in 2010. They should also start selling the CNG cars like Honda has done in California. Then Obama should make the oil companies put CNG stations. This just doesn’t seem that hard.
    If we let GM and Ford fail, we will have to have a jobs program to recreate those million jobs anyway, and the jobs will not be as good as the ones we lost. We need these people and these companies to help us get off foreign oil. It all works together.

    I have never seen a vacuum in leadership like we are seeing right now. Not only at the car companies but also with the president. I wish Obama would come out and start this whole process now. I hope January is not too late.


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    Jake

     

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    Nov 20th, 2008 (8:53 pm)

    I’m still kind of baffled by how badly Detroit screwed themselves with their whole fascination with huge cars. Foreign automakers jumped onto the SUV bandwagon too, but none of them are going bankrupt. I’m amazed at how deeply the Big 3 were invested in their trucks and SUV’s. So much for diversification.


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    Nov 20th, 2008 (9:05 pm)

    The E-Flex platform is GM’s future. Rick Wagner must give the performance of his life to Congress December 2nd….
    ______________________________________

    The 3-5 year recovery plan cannot rely on Volt. That would be automaker suicide. There’s simply no way retooling money can rely exclusively on a platform which isn’t realistic for high-volume production during that timeframe.

    Remember, the request from Congress is to explain how each automaker will become “financially viable” using this one-time allocation of money.

    In other words, how will they survive until Volt can be built & sold in large quantities? What must be delivered in the meantime?


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    Frank D

     

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    Nov 20th, 2008 (9:17 pm)

    I would love to see Rick Wagner and Bob Lutz go have a couple of beers and prepare a killer presentation to Congress on the superiority of the American engineered Volt and E-Flex platform. compare it to the Prius technology and explain the many benefits. They need to blow them away on how far ahead they really are…December 2nd is the day!


  62. 62
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    Nov 20th, 2008 (9:38 pm)

    FUTURE NEWS ~ 12/02/08

    CEO Rick Wagoner met with leaders of Congress today to discuss detailed plans concerning the recovery of GM.

    Arriving in a Chevy Volt, Wagoner quickly announced that a closed door agreement between GM and the National Highway Traffic Safety Administration (NHTSA) had been attained. Under this new agreement State law will be eased concerning the current 10 year minimum battery life standard on vehicles sold in America. This recalibration facilitates the approval of current E-REV test battery technology and will enable the new hyper efficient and comfortable Volt car to soon arrive in American dealerships.

    President elect Obama quietly backed this measure saying, “I am continuing to review the options presented by my support team. And I like what I see so far”.

    Appreciative applause was heard as Wagoner went on to list a dozen cost saving measures. Which include the sale of corporate jets and that the future company-wide wage and bonus adjustment policy in from now on tied lock step to bottom line profit.

    Shares of GM surging $2.25 on this news. Up from Monday’s closing price of $1.18, a 90 year low.

    =D~


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    Nov 20th, 2008 (9:50 pm)

    GM? Viable Plan?

    Yeah, sure. If it ever had any viable plans, would it be in the sorry state it is now?

    Red Ink Rick = loser


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    Frank D

     

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    Nov 20th, 2008 (10:33 pm)

    #62 Dave K, I like your thinking!


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    Texas

     

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    Nov 20th, 2008 (10:36 pm)

    This is a good move! The democrats come off as having some balls and GM will get their money mid December. Heck, nothing wrong with asking for a good plan. This is how the Obama administration should work. Draw up great plans by the best minds in the world and then implement.

    1) Plan
    2) implement
    3) monitor
    4) conclude successfully


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    George K

     

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    Nov 20th, 2008 (10:44 pm)

    At least this time the politicians’ faces look appropriately serious.


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    john1701a

     

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    Nov 20th, 2008 (10:48 pm)

    I would love to see Rick Wagner and Bob Lutz go have a couple of beers and prepare a killer presentation to Congress on the superiority of the American engineered Volt and E-Flex platform. compare it to the Prius technology and explain the many benefits.
    _____________________________________

    That misses the point entirely!

    Of course Volt takes efficiency technology to the next level. Congress already knows that! What they’re waiting to hear is what GM will sell in addition to Volt. All +3 Million vehicles from GM per year obviously won’t use E-Flex, especially in the short-term. Neither more of the same or waiting for Volt is acceptable. That is why Congress forced this delay.

    What steps will GM take to move forward in the meantime?


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    Ed M

     

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    Nov 20th, 2008 (10:56 pm)

    Texas #65

    I agree that it’s a good move. I think that congress’s demand for a long term viability plan is the right move and hopefully the Prez (either Bush or Obama) will sign it.

    This should give car buyers confidence that GM, Ford and Chrysler will be here for the long term if they buy one of their products. And it should help the Detroit 3 get rolling again and we can get back to discussions on the Volt and Li-ion battery technology

    Now we need to get those car loans flowing.

    Kudos all around.


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    vincent

     

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    Nov 20th, 2008 (11:02 pm)

    http://www.cnn.com/2008/POLITICS/11/20/global.trends.report/index.html

    A justification for Volt Technology. Click above ^^^

    How about the Government funding the Volt with our Tax dollars…we earn the profits the Old Fashioned Way…work for it.


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    Jeff M

     

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    Nov 20th, 2008 (11:07 pm)

    Can’t keep up with Lyle’s hourly posts 🙂

    Just so it doesn’t get lost… don’t forget those that do not learn history are doomed to repeat it. Ie. make sure to read how throwing money at the problem only delayed the inevitable in Britian…

    A British Lesson on Auto Bailouts
    http://www.nytimes.com/2008/11/18/business/economy/18car.html?_r=1&th&emc=th


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    Laura

     

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    Nov 20th, 2008 (11:13 pm)

    Regarding Dave K. #57:

    I disagree. In reality, the Civic and Corolla are on average $2,000-$3,000 more expensive than the Ford Focus and GM Cobalt. I read today that on the Wall Street Journal that in spite of the higher price, the Civic sold about 300K and the Focus about 170K during the same quarter. The real problem is that not only Ford sells way less units than Honda, but Ford and GM make very little if any profit from the Focus and Cobalt. Cars like the Civic is profitable though and that is what is killing the “Big 3”. The article also concluded that even when UAW salaries are reset by 2010 and The Big 3 pays comparable salary to plant workers, it is unlikely GM and Ford could profit from their small cars if the marketing strategy does not improve drastically. Arguably, the Ford Focus is not a bad product anymore and the car delivers decent fuel economy.

    So the conclusion is, Americans are not buying Civics, Corollas and Jettas because they are cheaper. It is really because of quality – or reputation.

    My conclusion is that, is GM going to change radically after receiving $12 bil.? I doubt. They have plans to launch “Camaro 2009”. The Big 3 don’t get it.

    “…American’s are whores. We will buy from who ever offers the best price on an item. This is a truth we can’t deny. The upcoming generation of American’s have never driven muscle cars. They have driven Civics, Century’s, Focus, scooters and bicycles. They don’t have the old school desire to slide onto a front bench seat, grab onto a wheel, and smoke the tires with 400 hemi encouraged horse power. It’s not a part of their culture. “


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    jbfalaska

     

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    Nov 20th, 2008 (11:18 pm)

    American CEO greed. AIG proven by its shameless CEOs are the kings of corruption of the highest order. Massages and a $40,000 bar tab to celebrate the bailout in a posh Club Med. GM, Chrysler, Ford CEOs fly in on corporate jets. They just don’t get it.

    If publicly funded, let’s add in receivorship. The taxpayer should be entitled to buy up the company stock, fire the CEOs and replace all of them with a low maximum wage for CEOs. If they can make more, well by all means, they can go. Then we can hire a foreigner, such as Honda’s CEO for at a mere $1 million per year instead of $35 million a year for Mullalay or the rest. Better for the bottom line and stock owner, all of us. Now I’m sounding like an American CEO, outsource the workforce and cap the workers wages. The dividends are then all of ours.


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    carcus

     

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    Nov 20th, 2008 (11:20 pm)

    Making the assumption that there’s not going to be many cars sold (regardless of the make ) throughout 2009 and probably into 2010, how then does this loan thing work out?

    Is America really going to plunge right back into the overspent overborrowed credit for everybody feeding frenzy that made us all so sick in the first place?

    Should we provide a $25B bridge loan to D.R. Horton and K.B. Homes?

    Who’s next?

    Go U$A! Principles and common sense be damned!


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    Dave K.

     

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    Nov 20th, 2008 (11:21 pm)

    hi Laura #71,
    I think you missed my point.

    Dave K. #57 said:
    “Honda announced that they can’t produce enough Fit cars to meet U.S. demand.”

    “The new generation wants technology. They want efficiency and expandability. They want something different from what their Dad wanted.”

    “If the Cruze, Volt, and plug in Vue were on delivery trucks TODAY. We wouldn’t be saying the ‘B’ word. We would be watching GM stock race up to double digits.”

    _______________________________

    I wasn’t bashing Civic, Century, or Focus. I listed these models as being popular and mentioned that huge engine carrying muscle cars are unpopular and not on the buyers list of today (the youth). Where as the Cruze, plug in Vue and the E-REV Volt are now in vogue.

    The low priced (whore) car mentioned is the Honda Fit.

    Thanks for your concerns.

    =D~


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    D Lo

     

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    Nov 20th, 2008 (11:25 pm)

    #43 Whynot
    “What makes politicians, most of whom have not worked in business, in a government that is multiple trillions in debt think they have the skill to evaluate a plan for future financial stability?”

    Only thing I can come up with is the old saying it takes one to know one–so these politicians will know if the Auto execs are liars.


  76. 76
    CaptJackSparrow

     

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    Nov 20th, 2008 (11:36 pm)

    “American’s are whores”

    lol….
    ONTFLMAO….

    If you hold a job, your a whore. lol…
    Yup, I’m a whore for the mighty $$$

    Hell, I’ll sell myself to Laura to get the down payment for my Volt!


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    Unni

     

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    Nov 20th, 2008 (11:41 pm)

    Rick is writing B plans from 1977 ( 31 years ). Its only a matter of seconds for him to present an utopian plan with even HUMMER H6 on E-H-Flex Plarform.

    Let moeny come and get all his pending salaries and he will quit, its LLC man.


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    D Lo

     

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    Nov 20th, 2008 (11:44 pm)

    Dave K,
    Glad to see you are back in style and again making valid points. The Camaro is a great one to be made. Look at the history of the Camaro on GMs own website. They cite having to scale down the size of the engine. Why? The 70’s Oil embargo. Only, because of development times, it didn’t hit the market until a few years later when oil was cheap again. Expect the 2012 Camaro to have the 1.4 L four, and then the 2015 to have the V8 when the price of oil is about to bounce back.

    If it hasn’t become obvious over every recession (yes, in a capitalist society these should be expected as corrections to the market) GM and the big three have been grossly underprepared. AMC folded, and Chrysler had to knock on Uncle Sams door in the early 80s.

    I have no faith that Barney Frank would know the difference between a balance sheet and a balance beam, but someone should be asking tough questions of the automakers.


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    Nov 20th, 2008 (11:48 pm)

    hi CaptJackSparrow #76,

    Maybe it’s just the crowd I hang with. Most of my friends are low price whores. Although one has pledged to buy a 2010 V6 Camaro. He likes red or maybe orange if available.

    I am proud to report that I own a Kodak digital camera. It’s the one I used to shoot pictures of the Volt at the Santa Monica Auto Show (09/26/08). And I plan on riding my motorcycle down to L.A tomorrow for the L.A. Auto Show. And yes, the Volt is being displayed. But there is more, several Dodge EV models are also being displayed.

    Will have a fresh sample of Kodak photos to share. Will be on vacation and MIA all of next week.

    2008 Honda Fit price http://garfwod.250free.com/Photos/honda%20fit%202008%20price.jpg

    =D~


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    Nov 20th, 2008 (11:52 pm)

    Jeff M #70

    I read your web posting on “A British Lesson on Auto Bailouts”. Thanks for putting it up.

    Near the end of the article this statement was made,
    “shoddy workmanship and a breakdown in labor relations brought the company to near bankruptcy by 1975”.

    What countries like Britain and the US are up against is some very strong unions especially when profits were good.and It became all but impossible for companies to remove bad employees.

    The union needs to concede that a relatively few bad employees can drag down a whole plant just like a weak player on the defense of a football team can ruin the team’s chances. The unions have to allow management to get rid of bad apples.

    America wants to compete in a free market with socialist ideas and it can’t be done unless there’s no competition. Of course bad management and bad labor will bring any company to its knees no matter the amount of the bailout.


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    CaptJackSparrow

     

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    Nov 20th, 2008 (11:53 pm)

    @Dave K #79

    Please take lots of pictures for us and post, pretty please!?!?


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    Nov 20th, 2008 (11:55 pm)

    hi D Lo #78,

    “I have no faith that Barney Frank would know the difference between a balance sheet and a balance beam…”

    _______________________

    Or a hemp balance scale?

    Please pass the 2 hose hookah.
    http://garfwod.250free.com/2hosehookah.jpg

    =D~


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    Red HHR

     

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    Nov 20th, 2008 (11:59 pm)

    Hi Dave K #57,

    Call me biased, i just do not like the looks of the Fit. Though I could be tempted by the CR-Z when it comes out. The CR-Z looks like an update of the Lotus 7. If someone could come out with an updated SS 90, something Sir William Lyons built before he came up with the Jaguar. Yes have it get 90mpg and cost 9 Grand.
    And I would prefer if it was made in the USA.

    http://www.ultimatecarpage.com/car/2115/Jaguar-SS-90-Roadster.html

    http://auto.howstuffworks.com/jaguar-ss-1003.htm

    Red HHR (Looking Good in Retro Red)


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    Nov 21st, 2008 (12:13 am)

    #82, Dave K.

    Is that particular device used to design automobiles?

    Red HHR (With updated aero look)


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    Nov 21st, 2008 (12:19 am)

    hi Red HHR #84,

    “Is that particular device used to design automobiles?”

    ____________________________

    No, it’s used to build snow ski resorts in the desert.

    ++++
    Ski Dubai is a indoor ski resort at the Mall of Emirates.

    Dubai is located in the United Arab Emirates. For the geographically challenged skiers out there, the U.A.E. is situated on the Persian Gulf with neighboring countries: Saudi Arabia, Oman and Qatar, and across the gulf is Iran.

    ++++

    See you tomorrow with L.A. photos.

    =D~


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    carcus

     

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    Nov 21st, 2008 (12:28 am)

    Fo’ you Johns out there eyeballin’ the fit:

    Yo dog, fo’get that asiatic ho’. If you want a cheap ride. Check this “slice” of american pie.

    Pimpin’ the focus.

    http://www.foxnews.com/us/foxcarreport/index.html

    (scroll down to “2008 Ford Focus SES Sedan w/Sync” for a mildly entertaining video)


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    Nov 21st, 2008 (12:39 am)

    I can’t believe people think the Volt is going to save GM. It is a low volume loss leader that might bring people in to buy other cars but unfortunately GM will probably also be selling those at a loss.


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    Nov 21st, 2008 (1:14 am)

    M1EK #35

    “Tundra monster truck plant here in San Antonio. They have also stated that they do not plan to build a plug-in hybrid and have talked down GM’s progress on the Chevy Volt.”

    More crap from denialists.

    Honda and Toyota didn’t fight CAFE kicking and screaming and getting loopholes for awful SUVs and pickup trucks.”

    Toyota took a lot of flak for joining Detroit in fighting the latest CAFE until it looked like the market would force them to meet the CAFE numbers anyway. ( eg. finally backing off on Tundra sales projections after making huge tooling investment)

    Jake # 59

    Do you recall that with their big legacy costs The Big 3? could only profit with the big margins of big trucks. Makes you wonder how they could think that the party would keep going on for so long. Well, we’re now in the wee hours of the morning, the music has stopped and the Japanese makers are the ones sitting pretty.


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    Nov 21st, 2008 (2:20 am)

    Why do people keep comparing the USA to the British auto industry.

    Its completely different.

    The USA industry is the largest in the world where the British was a nitch market.

    A GM bailout will be very successful if they do the right things.


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    Nov 21st, 2008 (4:17 am)

    As an outsider I would tell that congress shall press harder on those arrogant boys from big three. As an owner congress should be clause on management salary limitation (like NBA), french benefit dramatic reduction (dramatic reduction of jet size) and bonus strategy strictly depended on stock value development and fulfilment of loan clauses.


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    Nov 21st, 2008 (7:59 am)

    Jeffhre #88

    “Do you recall that with their big legacy costs The Big 3? could only profit with the big margins of big trucks.”

    This is only half true. That was the easiest way for them to make profits because of little overseas competition and friendly tax legistaltion. They always had an opportunity to innovate in the smaller car market but didn’t try very hard (mildly put).


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    Laura

     

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    Nov 21st, 2008 (9:40 am)

    I seriously doubt the government could direct GM to do the right thing. That is the problem. The right would be giving more money to GM, and like Roosevelt did during World War II, saying to GM stop what you are doing and build tanks. Now, if GM, Ford and Chrysler want money, make GM halt production of piece of garbage like Mustangs, Camaros and Charges of the world. “Muscle” cars in my view, are associated with unpolished men. If people like them, it is a personal opinion, but let those who like muscle cars buy used ones.

    I said that a long time ago to my friends:GM, Ford and Chrysler continue to produce out of fashion cars because they find people with bad taste to buy them. Great. The problem is that becomes a distraction and they end up losing focus on future and inovation.


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    Nov 21st, 2008 (10:43 am)

    #48 Rick C Says:
    November 20th, 2008 at 7:18 pm
    # 44 mkeinati:

    The UAW doesn’t manage GM. The board of directors and the managers under them do. It wasn’t the UAW that decided to build large hulking SUV’s, trucks and the poster child of poor fuel economy The Hummer.

    As I have posted previously. The UAW has seen its numbers plummet from an all time high of 80,000 employees in Flint, Michigan down to 12,000 today. The rest of those jobs went to ‘right to work states’ where there are no unions or they are very weak, to Mexico where you are murdered if you try to form an independent union, Brazil and now Russia. They have agreed to pay cuts for all new hires. They have assumed the cost of their pensioners’ health benefits. Meanwhile Wagoner and the other board members keep getting richer. They even had the nerve to fly on private jets costing $20,000 to ask for the taxpayers to bail them out of their stupid decisions to walk away from hybrids 7 years ago so that Toyota and Honda could take up the market. The UAW didn’t decide to crush the EV-1. That was a management decision. The UAW has given whenever asked. It’s time for management to offer up its pound of flesh now.
    —————-

    Big 3 white collar workers have taken a much larger hit over the years compared to the UAW guys. And there’s no debate. They just say you are gone, or your benifits are gone, or your pay is reduced. They don’t have a fat cat like Gettelfinger crying and threating strikes for them.

    Its time for the UAW to take a real hit, or pay the ultimate price and go bankrupt. This isn’t the time to try and hold your ground.

    I also think the executives should work for $1 for at least 2 years.


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    Nov 21st, 2008 (10:48 am)

    92 Laura Says:
    November 21st, 2008 at 9:40 am
    I seriously doubt the government could direct GM to do the right thing. That is the problem. The right would be giving more money to GM, and like Roosevelt did during World War II, saying to GM stop what you are doing and build tanks. Now, if GM, Ford and Chrysler want money, make GM halt production of piece of garbage like Mustangs, Camaros and Charges of the world. “Muscle” cars in my view, are associated with unpolished men. If people like them, it is a personal opinion, but let those who like muscle cars buy used ones.

    I said that a long time ago to my friends:GM, Ford and Chrysler continue to produce out of fashion cars because they find people with bad taste to buy them. Great. The problem is that becomes a distraction and they end up losing focus on future and inovation.
    —————

    I dont think you can/should tell people what to build or buy (free market/free will). You have to make it attractive to the consumer for what you are trying to accomplish. So if you dont want people to buy muscle cars, put a tax on them so only the die-hards & rich will pay for them. Is that fair? I dont know. it depends on your reason for not liking muscle cars and what you plan to do with the tax money.


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    Nov 21st, 2008 (11:18 am)

    I for one would love to pick up the new Camaro.

    I do not need or like 4 doors. The Camaro is looking like about half the price of a volt; that $20k price difference will buy a lot of gas.

    I like the concept of the E-REV’s, but I won’t be able to afford to be in the first or probably the second generations of them. Too rich for my blood. I don’t buy cars I can’t afford to pay cash upfront for.


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    Nov 21st, 2008 (12:56 pm)

    # 93 kdawg,

    If loosing 85% of your workforce since the mid 1980’s isn’t taking a big hit I don’t know what is. Further, the UAW was paid a lump sum by GM and now assumes all the health costs for its retirees.

    As for white collar workers, the engineers, the technicians, there would be far more of them working if they too were unionized but because of the way the labor laws are crafted they are not allowed to join. In the end both the UAW and the white collar workers are in the same boat except the UAW folks have the muscle to fight back.

    The UAW gave back in the form of layoffs and back then they were lectured and finger wagged about how they had to sacrifice for the good of the company and their fellow workers while CEO Roger Smith moved their factories to Mexico under what was called the Maquiladora program or Brazil and other countries where pollution and labor laws are lax. Just to see what it’s like you should take a trip sometime to Saltillo, Mexico just to see what it is like to live there.

    In this time the trucks have been built there ask yourself has the price of the GM’s trucks come down since they pay these workers $6 a day? Here’s an excerpt of a report from The Houston Catholic Worker, a Catholic charity, on how GM profits from these lower wages:

    General Motors trucks are built as well or better than they are in Michigan. In the U.S. a worker gets $120 per day on the assembly line, in Saltillo, $6 per day (April 29, 1998, HC). Interestingly a $6 daily wage is enough for the bare essentials, beans are 85 cents a kilo; but it will not buy a GM truck.

    http://www.cjd.org/paper/Mex.html

    As for top management they have NEVER cut their salaries, Cadillac health care and stock options benefits. You saw a small sample of that when they flew on their private corporate jets tin cup in hand to Washington while 10 million Americans are unemployed and don’t expect that kind of treatment from the government. It’s the sort of spectacle that ought to make the public fall to the floor and guffaw with laughter.

    Flint now has a workforce of 12,000 employees from an all time high of 80,000.00 and even now factories are closing and more UAW people are loosing their jobs. I suppose the only answer that will placate the critics of the UAW is if the UAW is put out of existence.

    Let’s say you do get what you want. Who do you blame next? The Mexican workers, GM’s woes can be squarely placed on GM’s management. It was GM that fought safety glass, safety belts, air bags, the catalytic converter, a car that could get 80 mpg under the Clinton program Partnership for a New Generation of Vehicles http://en.wikipedia.org/wiki/Partnership_for_a_New_Generation_of_Vehicles
    and of course the same GM crushed the EV-1 fully electric vehicle. The UAW just builds what GM’s management tells them to build. If the UAW had a seat on the board of directors you would have a point but with all the give backs and deep cuts it’s high time that Wagoner and company were sent packing and a new management team were put in.

    Since they like off-shoring and outsourcing so much in order to cut labor costs may I suggest they cut management costs by replacing themselves with any number of fine management talents from India. The companies there are well managed and their CEOs don’t hoard the pie like American CEOs do. What’s good for the goose is good for the gander. So let’s get started there’s no time to waste.


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    Nov 26th, 2008 (1:57 am)

    We want the Volt!!!! Ya Volt! Volts for Victory!!!! Volt’s boltz!