AND 
Automaker Bailout Negotiations Break Down, Loan Bill is Dead
After a long, tense and dramatic day, a deal to pass an amendment to the automaker bailout plan in the Senate broke down at a late hour.
The initial plan passed in the House was not acceptable to Senate Republicans as it did not require strict concessions from GM’s debtors.
Senator Bob Corker had proposed an amendment that would require debtholders to accept a 2/3 reduction in what they were owed, and the UAW to accept both a reduction in healthcare obligations owed in exchange for equity, and a pay scale on parity with US Nissan, Toyota, and Honda workers. If those terms were not met by 3/15/09, the automakers would have to declare bankruptcy.
For a while it looked like the compromise would be reached and the amended bill would be passed.
However, late Thursday it was announced that the UAW refused to accept the parity requirements until 2011. The Republican Senators did not accept this, and called the deal off. The Seante fell short of the necessary 60 vote to consider teh lefislatiogn, voting 52 to to 30 in favor.
It now appears to be dead.
GM has said it only has enough cash to last until the end of December.
Senate Majority Leader Harry Reid said “It’s over with, this is going to be a very, very bad Christmas for a lot of people as a result of what takes place here tonight.”
GM who it was reported yesterday has hired a bankruptcy firm, issued the following statement:
“We are deeply disappointed that agreement could not be reached tonight in the Senate despite the best bipartisan efforts. We will assess all of our options to continue our restructuring and to obtain the means to weather the current economic crisis.”
It is still possible that the White House could issue lifesaving funds to GM through the TARP, a measure they have opposed all along. White House press secretary Tony Fratto said “we will evaluate our options in light of the breakdown in Congress.” There are even reports that inside sources indicated Bush officials stated they would have to step in to save Detroit if Congress failed to act.
Could it be all over for GM? And what of the Volt? Stay tuned.
102 Responses to “Automaker Bailout Negotiations Break Down, Loan Bill is Dead”
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December 11th, 2008 at 10:44 pm
Chrysler deserves nothing.
They have deep pockets and a parent company with huge cash.
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December 11th, 2008 at 10:47 pm
Senator Bob Corker is from Tennessee. They make a lot of Toyota’s down there. No problem for Corker if GM goes belly-up…
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December 11th, 2008 at 10:51 pm
#2 Dave G,
“Senator Bob Corker is from Tennessee. They make a lot of Toyota’s down there. No problem for Corker if GM goes belly-up…”
If the (assemble) Toyota’s in Tennessee, rest assured when/if GM files Chapter 11 that Corker, Toyota and Tennessee will have plenty of problems. This pond will have huge ripples.
Welcome to the great recession. I hope the oil companies, maybe Exxon-mobile, will step in. Vertical integration, they call it.
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December 11th, 2008 at 10:53 pm
UAW – Unrealistic Auto Workers
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December 11th, 2008 at 10:54 pm
Can’t say this is a surprise after ‘anonymous’ people saying the meeting went do badly. I’m surprised Reid got everyone all ‘frothed’ up a ‘impending vote’ though
UAW strikes again…one last time, lol. But never say never, they’ll be back…if the market lets them. (They better move quick…if that is possible).
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December 11th, 2008 at 11:08 pm
Peole should continue to buy Ford, Chevy, both brands should be OK, but NOT Chrysler, Dodge, Pontiac, Mercury, Saturn, Hummer, etc.
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December 11th, 2008 at 11:12 pm
I am not a union member, so it’s hard for me to understand why someone would rather not have a job, than to have a job with less pay…
Well, they say it ain’t over till the portly lady sings…maybe this is just more political posturing…or maybe we’re hearing that lady clearing her throat…
I wonder how fast GM stock will drop from the over $4 closing today to zero…
Well…it’s been real, and it’s been fun…would’ve been nice if we’d seen a Volt run…
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December 11th, 2008 at 11:16 pm
Someone will make the Volt or a Volt like car. That will get spun off even in a worst case scenerio.
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December 11th, 2008 at 11:17 pm
#6 Chrysler Dead
…NOT Chrysler, Dodge, Pontiac, Mercury, Saturn, Hummer,
Mercury is part of (relatively) stable Ford. While irrelevant, I don’t think any risk exists. GM or Chrysler is not structured in such a way that just one brand would go under–its all or nothing.
Boone Pickens: Buy GM & get us off foreign oil.
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December 11th, 2008 at 11:22 pm
#6 Chrysler Dead Says:
Peole should continue to buy Ford, Chevy, both brands should be OK, but NOT Chrysler, Dodge, Pontiac, Mercury, Saturn, Hummer, etc.
=======================================
I take it by your handle you assume this means the end of Chrysler…but in reality GM is the first to go.
We only have Chrysler themselves saying they are running out of cash…they still have mom and dad (Cerberus) who may or may not bridge them through to the next administration….GM has nothing.
GM has been operationally bankrupt for weeks. They are several billion below monthly debt obligations, without funding or the reasonable expectation of bailout funds incoming shortly…they are the walking dead.
Creditors will be on them as soon as tomorrow unless someone reconsiders their position… or the TARP magically becomes available (sounds a lot like another failed vote, lol)
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December 11th, 2008 at 11:31 pm
I have always been pro union but all I’m hearing I’m starting to change my opinion.
If the union is part of the problem then if GM needs to go bankrupt to fix that problem then I’d vote for that to happen.
It will be interesting with the Dem’s in power what happens with the unions. Will they go after any attempt to smash the union or ignore strike breaking like Regan.
My understanding is that D LO is right about GM’s individual brands being tied together and not so easily broken up or sold. Who would buy them anyway? Not Pickens.
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December 11th, 2008 at 11:37 pm
That was well done. I am sorry for people losing jobs, but we have to go through this. The whole deal was fishy. The Big 3 actually needs from $75-$125 billion. Chrysler parent company does have cash, but does not want to spare any.
So it is well done.
The Prius plug-in is on the way and other plug-ins will survive regardless of the Volt.
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December 11th, 2008 at 11:41 pm
#2 Dave G
#3 D LO
I’m not sure where you get your info…but it is not very good. I do not know of any Toyota assembly plants in TN.
GM – Spring Hill, TN (old Saturn plant retooled for a crossover in 2007-2008)
Nissan – Smyrna, TN
Also, I heard Corker’s “neck of the woods” is getting a Volkswagon plant.
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December 11th, 2008 at 11:44 pm
#10 Statik
Creditors will be on them as soon as tomorrow unless someone reconsiders their position… or the TARP magically becomes available (sounds a lot like another failed vote, lol)
==================
Bank bailout funds could be used for Detroit
Sources: White House warning GOP senators Wall Street bailout funds might be used for automakers now that auto loan package has failed.
WASHINGTON (CNN) — The proposal to loan $14 billion to Detroit’s struggling automakers collapsed late Thursday night but the Big Three may get some money anyway.
Bush officials warned wavering GOP senators that if they didn’t support the legislation, the White House will likely be forced to tap the Wall Street bailout to lend them money, two Republican congressional officials told CNN earlier. This is a noteworthy change since the White House and Treasury Secretary Henry Paulson have previously refused to use bank bailout funds to help General Motors
http://money.cnn.com/2008/12/11/news/companies/whitehouse_warning/?postversion=2008121122
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December 11th, 2008 at 11:45 pm
Ok so workers are on strike, no big deal… saves GM the wages needed to pay them. With the money saved from not paying the workers, and the Income from the FIRESALE. Gm should be able to hang on till Jan 20. Then well be ok. Right? right?!
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December 11th, 2008 at 11:50 pm
Continued from #13
The UAW (with the help of the local at the Saturn plant) attempted to unionize the Nissan plant a couple of times without much luck. The Nissan plant is about 30-40 minute drive from the Saturn plant.
Apparently, Nissan treats their employees pretty good…or something else hindered the UAW’s efforts.
The Saturn site is nice…and some great people to work with there. I miss it sometimes.
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December 11th, 2008 at 11:54 pm
It seems like in a healthy organization or business a union should not be necessary.
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December 12th, 2008 at 12:04 am
If I’m understanding this already, then those UAW workers are greedy bastards. It appears that unions are always shitty workers that think they’re better than everyone else (at least that’s how it is in the construction/fenestration industry and apparently the auto industry as well).
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December 12th, 2008 at 12:18 am
#11 Bearclaw
As you know, unions help keep the “corporate world” more tuned to worker conditions and benefits. This was very much needed when the US unions were created years ago. But, unions might be considered a victim of their own success. The UAW benefits are nice…yet costly…but it is not enough for private corporate jets or a yearly salary (and perks) that would last common man a lifetime.
However, the unions lobby for many good things…but most people focus on the negative. Overall, it is difficult for me to speak about the need for unions. I’ve seen several negative things that would give anyone pause in a union facility…but corporate greed can give a person pause also. All stakeholders need to work toward to make their business successful.
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December 12th, 2008 at 12:19 am
Here is how individuals voted:
52 yeas
35 nays
NV 12
Alphabetical by Senator Name
Akaka (D-HI), Yea
Alexander (R-TN), Not Voting
Allard (R-CO), Nay
Barrasso (R-WY), Nay
Baucus (D-MT), Nay
Bayh (D-IN), Yea
Bennett (R-UT), Nay
Biden (D-DE), Not Voting
Bingaman (D-NM), Yea
Bond (R-MO), Yea
Boxer (D-CA), Yea
Brown (D-OH), Yea
Brownback (R-KS), Yea
Bunning (R-KY), Nay
Burr (R-NC), Nay
Byrd (D-WV), Yea
Cantwell (D-WA), Yea
Cardin (D-MD), Yea
Carper (D-DE), Yea
Casey (D-PA), Yea
Chambliss (R-GA), Nay
Clinton (D-NY), Yea
Coburn (R-OK), Nay
Cochran (R-MS), Nay
Coleman (R-MN), Nay
Collins (R-ME), Yea
Conrad (D-ND), Yea
Corker (R-TN), Nay
Cornyn (R-TX), Not Voting
Craig (R-ID), Not Voting
Crapo (R-ID), Nay
DeMint (R-SC), Nay
Dodd (D-CT), Yea
Dole (R-NC), Yea
Domenici (R-NM), Yea
Dorgan (D-ND), Yea
Durbin (D-IL), Yea
Ensign (R-NV), Nay
Enzi (R-WY), Nay
Feingold (D-WI), Yea
Feinstein (D-CA), Yea
Graham (R-SC), Not Voting
Grassley (R-IA), Nay
Gregg (R-NH), Nay
Hagel (R-NE), Not Voting
Harkin (D-IA), Yea
Hatch (R-UT), Nay
Hutchison (R-TX), Nay
Inhofe (R-OK), Nay
Inouye (D-HI), Yea
Isakson (R-GA), Nay
Johnson (D-SD), Yea
Kennedy (D-MA), Not Voting
Kerry (D-MA), Not Voting
Klobuchar (D-MN), Yea
Kohl (D-WI), Yea
Kyl (R-AZ), Nay
Landrieu (D-LA), Yea
Lautenberg (D-NJ), Yea
Leahy (D-VT), Yea
Levin (D-MI), Yea
Lieberman (ID-CT), Yea
Lincoln (D-AR), Nay
Lugar (R-IN), Yea
Martinez (R-FL), Nay
McCain (R-AZ), Nay
McCaskill (D-MO), Yea
McConnell (R-KY), Nay
Menendez (D-NJ), Yea
Mikulski (D-MD), Yea
Murkowski (R-AK), Nay
Murray (D-WA), Yea
Nelson (D-FL), Yea
Nelson (D-NE), Yea
Pryor (D-AR), Yea
Reed (D-RI), Yea
Reid (D-NV), Nay
Roberts (R-KS), Nay
Rockefeller (D-WV), Yea
Salazar (D-CO), Yea
Sanders (I-VT), Yea
Schumer (D-NY), Yea
Sessions (R-AL), Nay
Shelby (R-AL), Nay
Smith (R-OR), Not Voting
Snowe (R-ME), Yea
Specter (R-PA), Yea
Stabenow (D-MI), Yea
Stevens (R-AK), Not Voting
Sununu (R-NH), Not Voting
Tester (D-MT), Nay
Thune (R-SD), Nay
Vitter (R-LA), Nay
Voinovich (R-OH), Yea
Warner (R-VA), Yea
Webb (D-VA), Yea
Whitehouse (D-RI), Yea
Wicker (R-MS), Nay
Wyden (D-OR), Not
http://senate.gov/legislative/LIS/roll_call_lists/roll_call_vote_cfm.cfm?congress=110&session=2&vote=00215
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December 12th, 2008 at 12:21 am
I believe this is a big dog and pony show for the big 2.5555 to make it look like the govt, it’s lack of support, is what pushed them into bankruptcy. That way they can say they tried and the govt couldn’t deliver. So now the Unions can’t say crap.
Then restructure as everyone explained and the Union is gone.
Interesting way to clean the house of the cancer of UAW.
Sounds good to me, just give me my Volt!
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December 12th, 2008 at 12:21 am
GM’s statement:
“We are deeply disappointed that agreement could not be reached tonight in the Senate despite the best bipartisan efforts,” GM spokesman Tony Cervone said.
“We will assess all of our options to continue our restructuring and to obtain the means to weather the current economic crisis.”
http://www.reuters.com/article/marketsNews/idUSN1241562720081212?rpc=44
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December 12th, 2008 at 12:25 am
I don’t remember where I am in the line for the Volt but if wose comes to worse, I GET FIRST DIBS ON THE PROTOTYPE!!
You heard it first here.
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December 12th, 2008 at 12:27 am
Good, bankruptcy is what should have happened in the first place. I would actually buy a post bankruptcy GM car, but not a post bailout GM car.
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December 12th, 2008 at 12:28 am
The old UAW has nothing to loose and cares nothing about active workers, thier children or the industry and country that has made them fat. Thier pensions and retirements are safe, the American Taxpayers will pick up the tabb. I feel sorry for young workers in the UAW who are seeing GREED on an unthinkable scale as thier union is willing to kill the industry rather than give in a little! Greed for the mighty $ is not just in the board rooms and on wall street.
The Great Depression may have nothing on what is about to happen in America.
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December 12th, 2008 at 12:29 am
“Disaster Capitalists” like Bob Corker see every crisis as an opportunity to advance the destruction of the American blue collar middle class and benefit the corporate owners. And as one of the last big unions, UAW is a rich target. Corker would rather hold all of America hostage rather than let this opportunity go by without doing major damage to American auto workers.
The UAW has *already* made a lot of concessions even before this crisis. Base wages are almost the same as their Japanese counterparts. The benefits per employee are higher, because in Japan THOSE BENEFITS ARE THE RESPONSIBILITY OF THE GOVERNMENT, NOT THE CORPORATION.
Why the “beggar thy neighbor” attitude that some have over blue collar manufacturing employees? Why insist Americans live on a Wal*Mart greeter’s wage?
http://www.nytimes.com/2008/12/10/business/economy/10leonhardt.html?_r=1&hp=&pagewanted=all
“We’ve heard this garbage about 73 bucks an hour,” Senator Bob Casey, a Pennsylvania Democrat, said last week. “It’s a total lie. I think some people have perpetrated that deliberately, in a calculated way, to mislead the American people about what we’re doing here.”
So what is the reality behind the number? Detroit’s defenders are right that the number is basically wrong. Big Three workers aren’t making anything close to $73 an hour (which would translate to about $150,000 a year).
It’s the cost of benefits for retirees. These are essentially fixed costs that have no relation to how many vehicles the companies make, or how many workers they have, or how many hours they work. In fact, the more workers they lay off, the number GOES UP.
You may as well throw Nardelli’s, Waggoner’s and Mulally’s salary and bonuses in that “wage per hour” number. And the supply chain, too. And the rents and light and debt service.
Help US companies with their retiree costs, you instantly make them competitive.
“Beggar thy neighbor” won’t. It’ll just wreck the US economy.
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December 12th, 2008 at 12:30 am
@Steven
Dude, I said it before…..
If you buy the Volt and then GM goes under…………Vioala! You have a “Collectors Item”.
Sounds bad I know but hell, that’s how it goes. A guy gotta make a buck some how. lol.
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December 12th, 2008 at 12:31 am
We’re watching history unfold. Obviously GM cannot go down over a few billion dollars.
I’m curious who will blink first or if they’ll both just let it all come crashing down as they stare at each other. The UAW has honestly lost any sympathy anyone had for them. It’s not asking that much to accept the same wages as everyone else in their career field.
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December 12th, 2008 at 12:45 am
The UAW already made huge concessions in wages and healthcare:
http://www.freep.com/apps/pbcs.dll/article?AID=2007710040401
The UAW compromised on deep wage cuts on all new employees in a “tiered” wage concession. The more employees GM lays off, the more remaining workers will be at the lower wage. (And believe you me, the “upper tier” workers are going to be on the top of the list for any layoff)
http://www.labornotes.org/node/1248
Auto Makers Push VEBA Solution for Industry Crisis
A rising chorus of business gurus is singing the praises of a new solution to the U.S. auto industry’s ongoing crisis: one big health care trust for all the Big 3’s workers. According to the proposal’s cheerleaders, the Big 3 auto makers can slice off an estimated $116 billion worth of retiree health obligations from their balance sheets in one swoop and restore profitability.
What’s more, union members will gain too because the money and future administration of retiree health care will be placed in the hands of a massive UAW-administered trust, called a Voluntary Employees Beneficiary Association (VEBA).
A simple win-win for all, right?
“Wrong,” say a growing number of United Auto Workers members. UAW rank and filers, including members of the UAW rank-and-file group Soldiers of Solidarity, have launched a campaign to demand that all plans for such a solution be dropped in current contract negotiations.
In one campaign leaflet these workers say that VEBA really stands for “Vandalize Employee Benefits Again” and that the plan will allow “the company to walk away from retiree health care commitments, and shift all the risk.”
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December 12th, 2008 at 12:47 am
Not surprisingly I’m from the “it ain’t over until it’s over” camp. We’re still at the political square dance stage (or maybe the “They shoot horses don’t they” Marathon dance stage contests (ironically set in the Depression Era). Unions really DID have a very useful role in breaking management’s strangle hold on important labor areas My father and Grandfather survived working in coal mines largely with the help if the Molly McQuires), but to me it seems that once those battles were won, laws were written to make the union’s role in those areas moot (e.g. OSHA). Politicians are often referred to as “out of touch”, but if the Unions continue to dig their heels in about concessions, they’ll have orchestrated their own demise and take the industry down with them. I know, management has plenty of blame to carry, but it doesn’t sound like they are unwilling to TRY to make a streamlined system work. No sign yet of any flexibility on the part of organized labor.
Very sad and equally terrifying.
Be well,
Tag
PS I remember loading computer games from audio TAPE cassettes (completely sequential code) into the Commodore. Anyone remember Zork? Totally a text adventure. Zero graphics, except for the well done “word pictures”. Pong was a huge leap forward (g), then atari, etc
Let’s just get GM to see it to Monday!
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December 12th, 2008 at 12:49 am
Guess GM is going to be the next in a long line of companies filing Chapter 11.. this is crazy.
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December 12th, 2008 at 12:50 am
And AIG is handing out “retention payments” (between $92,500 and $4 million) to 168 employees.
Brilliant.
http://www.cbsnews.com/stories/2008/12/11/earlyshow/main4661900.shtml
/”drill baby drill” has been replaced with “bust the UAW”
/enjoy watching your retirement funds melt down tomorrow
/you can blame the UAW for that too I’m sure
/how does it feel being manipulated
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December 12th, 2008 at 1:00 am
Here’s what should happen…..
GM file Bankrupt.
Restructure withou the Union.
Ask for the loan, but this time the Unions are not in the picture.
Accept all stipulations.
Build my Volt!
Sound good?
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December 12th, 2008 at 1:04 am
I’ve said all along the only way the Volt will get here (via GM) is for GM to go chapter 11, I just hope its not too late.
I was a union man for 30 years and unions don’t back off they will cut off their noses to spite their own faces.
The only way to renegotiate contracts with unions, creditors and ceo’s is bankruptcy
NO PLUG NO SALE, LJGTVWOTR, (my house)=D~~~~~(my volt
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December 12th, 2008 at 1:14 am
#29 Lurtz
The UAW did make concessions but they won’t take effect until 2011and 2012 this 2008-09, in my book that’s not making any concessions until it is too late
NO PLUG NO SALE, LJGTVWOTR, (my house)=D~~~~~(my volt
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December 12th, 2008 at 1:19 am
#14 Statik – “Bank bailout funds could be used for Detroit”
Having presided over the worst financial meltdown in seventy-five years, I doubt Paulson wants to have his final act be the killing of the iconic US auto industry. The other question is where is the Fed and Ben Bernake.
The Bush Administration should have orchestrated the bailout administratively in the first place. It would have been much more effective — stopping the entire insanity of having the Sierra Club design cars and Republican Senators negotiating union contracts — and avoided the entire political soap opera which ended with Republican Senators seemingly cementing the minority party position of the GOP for the next twenty-five years.
Unless something happens soon suppliers will start going belly up in the next several weeks.
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December 12th, 2008 at 1:20 am
GM – Grieving Manufacturer
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December 12th, 2008 at 1:26 am
My first thought on this was: is the UAW insane? Then I realized that there is no way the politicians will let them die. Money will come somehow. This is all so crazy.
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December 12th, 2008 at 1:30 am
Casey – the VEBA concession was made in 2006. The tiered wages concession was made in 2007.
In your book, if it happened too early, it’s not making concessions. They have to make NEW concessions. You won’t be happy until workers look like impoverished characters in Charles Dickens’ stories. And still you’d spite them for … you’d think of something.
But what do you care? “You got yours.”
Hope everyone’s invested heavily in union hatred, cause that’s the only thing that won tonight.
/”drill baby drill” has been replaced with “bust the UAW”
/enjoy watching your retirement funds melt down tomorrow
/you can blame the UAW for that too I’m sure
/how does it feel being manipulated
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December 12th, 2008 at 1:36 am
#35 Casey – “The UAW did make concessions but they won’t take effect until 2011and 2012 this 2008-09, in my book that’s not making any concessions until it is too late”
As has been pointed out, the UAW concessions are about as relevant to GM’s survival in both the short and long run as the sale of the corporate jets. IOW not very. Moreover the entire demand for UAW concessions was a charade. As a legal matter the UAW leadership couldn’t commit to the concessions sought by the Republicans — even changes in health care have to be ratified by members, much less sweeping changes in wages and benefits. The process takes weeks.
The Republican alternative was simply a charade designed to lend a patina of plausibility to the otherwise silly notion that the UAW was to blame for the bill’s defeat and to give Republicans some talking points for dummies. Apparently those points have found an audience of at least one.
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December 12th, 2008 at 1:39 am
How come the Republicans never ask the CEO’s to take a big hit on pay and drop the parachutes? Why is it always the worker in the trenches?
The Union might be out of line but come on, $40 million a year to be the CEO and watch the place go up in flames!
The total hypocrisy is just unbelievable.
The pond is big but you will feel these ripples, guaranteed!
Best of luck to the USA – we are going to need it.
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December 12th, 2008 at 1:57 am
#39 Lurtz
#40 Don C
I was referring to what Gettelfinger said in front of the Sen. and House hearings last week
And Lurtz, my pension comes from a city in Ca. and it might be going under too, so I might not be having it made, as you said, if I lose my pension I’ll lose everything
#41 Avatar, I’m a republican and I’m appalled at it, and so say most the news I watch (FNC)
(did I miss anybody?
NO PLUG NO SALE, LJGTVWOTR, (my house)=D~~~~~(my volt
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December 12th, 2008 at 2:08 am
Sad day/..
Very sad ….
Poor American workers being sold out to evil guys in Washington driving there foreign cars being paid by Toyota lobbyists.
just sad
The government is not a government for the people.
It for there wallets and greed takes over the good of the people.
IF bush dosent do something quick to safe the big 3 there be nothing left of the USA
I will have to buy and extra lock for my door at night. The crime will get really bad.
The home boom is over … if we dont produce things like home and homes are not going to come back.
No home production no car production = entire country out of work.
Prob a good investment to buy stock in lock companies something people will have to do . No money left in the market if gm goes. So will have to protect whats left of you home.
I have some home for Obama or Bush can fix this but I hope they do something fast
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December 12th, 2008 at 2:33 am
If the Republicans in the Senate kill this and GM and Chrysler go down for the count, then there will be hell to pay. The Republicans will be the party who destroyed the American Auto Industry. They will be finished in the Mid-West for at least 20 years. The Republicans have often been called the “stupid party”. They continue to prove it over and over again.
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December 12th, 2008 at 2:45 am
End of UAW,
if UAW didn’t accept, end of big 3, back to end of UAW
UAW accepts, end of UAW
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December 12th, 2008 at 2:51 am
That is CHANGE, too !
Why you want to support old structures?? Better support Aptera Motors or Tesla Motors!
The GM Volt is a good concept, but it was designed by OPEL in Rüsselsheim, Germany and NOT by General Motors! Opel/Solarworld should sell Opel Flextremes (GM Volts) in USA
GM stood for BIG SUVs which YOU have bought a long time!
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December 12th, 2008 at 3:07 am
You want a serial plugin hybrid like the Volt?
buy a MINDSET:
http://www.mindset.ch
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December 12th, 2008 at 3:39 am
Posted by # 44. truthguy “If the Republicans in the Senate kill this and GM and Chrysler go down for the count, then there will be hell to pay. The Republicans will be the party who destroyed the American Auto Industry. They will be finished in the Mid-West for at least 20 years. The Republicans have often been called the “stupid party”. They continue to prove it over and over again.”
What’s funny is Bush’s stupidity has already brought that “stupid party” view to all time high’s, the Republican party is already on the ropes with one eye severely swollen, I can just imagine what will happen when GM goes down because republicans rallied around Bob Corker, and his name will live in infamy as this single act begins pulling down with it at least 1 million jobs within the first year probably.
Obama is going to inherit one giant mess. And what’s he gonna do? Deficit spend (there’s a new idea) until the cows come home. Sure it sort of worked during the Great depression, but that was because it had never been done before and the government wasn’t already so in debt. At this point (and especially if we lose our auto industry), we won’t have any kind of income as a country to ever pay back our debts. How are we going to pay back $12 trillion plus whatever Obama spends building infrastructure when we are losing hundreds of billions of dollars a year (even with our auto industry) in trade deficit?
You know what would be funny is if oil production started to decline in the next few years on top of all this. I’d just be laughing.
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December 12th, 2008 at 3:52 am
Lurtz, I actually agree with you on the pay of UAW workers. It’s really only a few more bucks an hour. No big deal. Also folks, don’t forget that Japan also has unionized workers back home! JAW. Check it out. They don’t have to play the union game outside of their boarders. However, the Big 3 don’t have to either. Yeah, it is crazy.
So, what’s my beef with the unions? Lurtz, maybe you can come up with some rational here.
The biggest problem with the unions is not their pay or benefits. The biggest problem with the UAW is their CONTROL OVER OPERATIONS! GM can’t put a plant in a location that has the best resources, tax breaks, incentives, etc. The union also controls the amount of automation that the company can use! What about the need for layoffs if the business is cut? Nope! The union is so strong that GM has to continue to pay workers that are not even working! OK, they dropped the ridiculous job bank but there are many clauses in the contract that keep GM from making sound business decisions. This, I feel, is the biggest problem with the almighty UAW. Also, since it’s now a pride thing, the UAW would rather go under than compromise any further. It’s human nature. They have reached the point of self destruction. They would rather die (so to speak) than bow to evil tormentors (management and the government).
Say what you like, in our global economy where globalization is king, an unreasonable union will bring even the mightiest corporation to it’s knees by tying their hands behind their backs. If there are non-union factories competing then it’s only a matter of time.
This is analogous to the U.S. outspending the U.S.S.R during the cold war. The Soviets could not keep up. Pure capitalism, which has very little concern over their slaves, I mean workers, will eat up any socialized system. Now, as you can tell from my tone, I don’t think it’s right for companies to abuse their power by only retaining young, obedient and low paid workers. It’s just the fact that it becomes a very efficient system. You can pay a Chinese worker a $1 a day, give them no benefits and they will work their fingers to the bone because working the farm is much harder and gives less pay.
We may just be witnessing the end of the UAW. Some say good riddens! Some don’t care. Some are worried. However, let’s just hope the government keeps up with worker safety standards, the ability of the worker to carry their own retirement funds (401K and IRA) and works to do the same with health care. If the workers have those basics taken care of then the free market system will work much better. Workers will then be able to easily move away from bad employers (see GM before the UAW) and towards good employers. Unions will no longer be needed because the worker has the freedom to choose where he/she works. The company that wishes to have the best workforce will need to treat it’s workers well, or risk losing them. This is how it should work and this is how it does work for the very skillful workers at any given company. How well do you think a university treats it’s top professor? A software company treats the best programmer? A team treats it’s best athlete? You guessed it. Like royalty. Having a union is really like being treated like royalty when you are really a fourth string bench warmer. Is that harsh? How about open your job up to the public? You might get engineers applying for the same job! That is just not right! However, back when unions were formed, the way companies were allowed to treat their workers was just not right. Things changed. Now the unions much change with the times. Safety and freedom first! That is the job of the government. A government can make it easy for a company to treat it’s workers like cattle or to treat them as fellow citizens. It’s our job, the voting public, to make sure the government treats us fairly. It’s our job to become educated and not allow lobbyist and fancy marketing to cloud our judgment (like a pharmaceutical company telling us that it’s better not to have universal health care and to allow them to profit from our health- we fell for that one).
Unions are dinosaurs of the past and only a company that needs a union (because they treat their workers poorly and those workers have no option to change jobs) will have one.
I think we will start to see a much faster move away from unions. As Internet technology improves and systems are devised to tap the brain power from people all over the world there will be little a union can do to maintain it’s power.
Companies that have unions, like the Big 3, will simply go out of business and the companies that replace them will be smart enough to never allow a group of workers to hold them hostage. Call a strike? No problem, we’ll just bring in units from the other side of the world. They then shutter the striking operation until the strike collapses.
Besides, unskilled factory work is going to be automated anyway. The point is, you should only be getting paid for the type of work you do, not because you have been there the longest, or have a contract that says you can sleep on the job. If there’s a way to get around a socialized workforce, companies will try to find a way around it.
It’s also going to be hard for the public to get behind the unions when they know it’s not right for a guy with a PhD. to have a lower salary then a guy that can be trained in one week. It just doesn’t feel right. As long as the worker is not abused the public is not going to stand behind this unfair system. A socialized system, like unions, must be fair and equal for the population or it will not have the support to survive.
Any system that rewards unskilled labor and provides an above average existence is actually retarding motivation to enrich one’s skill set. If you can eat steak and drive a BMW for putting on lug nuts, why would you waste time to take some classes to learn a skilled profession? When our civilization reaches that point where nobody has to work and we can all frolic in the flower gardens then great! However, we are not there yet. Far from it.
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December 12th, 2008 at 4:59 am
At this point letting GM go into Chapt 11 may be what is needed to get a little responsiveness on all sides. It certainly might precipatate a little captulation in the market. Once that happens either Treasury or the Fed will come up with enough money to get them through bankrupsy proceedings and all the things that Corker stipulated will happen anyway, maybe in spades. Certainly there should be a run on GM’s bank today and that should get us to bankrupsy. The market is really strange, maybe it will go up, but I don’t think so. I don’t think the Democrat’s plan was viable.
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December 12th, 2008 at 6:56 am
I’m not really getting the “wage parity” issue. I mean, who’s wage are we talking about? Nissan pay is lower than that of GM workers while Toyota pays slightly higher.
Benefits parity is an entirely different issue and I think it’s commendable for the UAW to stand up for their workers. Factory work is tough and it can cause irreparable harm to the body if done over long periods of time, even if precautions are taken by the workers themselves. It’s the business they work in. I’m not saying that Toyota or Nissan are terrible companies to work for but keeping a living wage, retirement benefits and post-work health care is alot to invest in. That wage portion is probably the smallest of the three.
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December 12th, 2008 at 6:56 am
(V)anished (O)n (L)iquidity (T)urndown
Ter
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December 12th, 2008 at 7:00 am
GLV #7 says,
I am not a union member, so it’s hard for me to understand why someone would rather not have a job, than to have a job with less pay…
————–
Agreed. If I had to choose between no money and some money, I would pick some money.
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December 12th, 2008 at 7:08 am
#51 Propane says,
I’m not really getting the “wage parity” issue. I mean, who’s wage are we talking about? Nissan pay is lower than that of GM workers while Toyota pays slightly higher.
Benefits parity is an entirely different issue and I think it’s commendable for the UAW to stand up for their workers.
————–
Is this really a good thing? What if GM files Chapter 11, and those workers lose their jobs. Did the UAW standing up for their workers hurt those same workers or help them?
Unions are becoming less significant in this country as membership declines. I don’t see how the UAW helps GM now.
In 2006, only 12% of the work force was union, down from 14.9% in 1995. In my opinion, they do more harm than good.
Source:
“http://www.aflcio.org/joinaunion/why/uniondifference/uniondiff11.cfm”
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December 12th, 2008 at 7:41 am
#54 Rashiid Amul says “What if GM files Chapter 11, and those workers lose their jobs. Did the UAW standing up for their workers hurt those same workers or help them?”
==========================================
If they lose their jobs, certainly the union hurt rather than helped. One can’t overlook some history here. The bitter history of labor relations at GM makes the union suspicious of the management. From the union perspective, if there are going to be pay cuts, why should workers go first, rather than management, or banks or other big dogs?
I think the UAW badly miscalculated and took far too hard a line, but as a union member, I remembering the devious behavior of my management in some past years. I don’t find it hard to understand where the UAW leadership is coming from — they don’t want to go home and tell the members “we gave up this and that and the other but management gave up nothing.” Some upfront management pay and perk reductions would have helped him a lot.
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December 12th, 2008 at 7:41 am
According to figures from Statistics New Zealand released today, car sales are down 19.5 per cent since September 2007.
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10547784
Things have gone downhill since then IMHO.
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December 12th, 2008 at 7:46 am
I wonder why GM can not just fire every member of UAW, and then hire unemployed immigrants instead? They (immigrants) will be happy to work for 3 times less salary.
At least, in my country problems with the worker unions are solved in such manner.
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December 12th, 2008 at 7:51 am
CNN is reporting that the Wall street journal is reporting that GM has hired bankruptcy lawyers.
“http://money.cnn.com/2008/12/11/news/companies/GM_bankruptcy_lawyers/index.htm”
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December 12th, 2008 at 7:51 am
Wow it’s been a busy night that I missed.
What’s next for GM? Is this the end of the political rope for them? Thoughts?
I suppose if it were the end of the rope suppliers would be demanding payment and things will get interesting today. Of course you never say never in politics, and Bush still has the TARP. Though UAW never made political donations to the Republican Party, so Bush doesn’t owe them in favors. Sounds sad, but that’s politics. Nobody said it was efficient.
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December 12th, 2008 at 8:20 am
Good Morning,
I find myself awake this morning and I have nothing to contribute or discuss. (insert sarcastic applause here).
Everything is now exposed, the cards are on the table…we are just waiting to see the fallout. At the moment there is nothing on the horizon, the past is the past, and the future is….well, today.
Right now two people control the future of GM and the Volt. I guess we could revisit history and argue semantics all day, who is most to blame for what…but that seems wrong. We just have to sit back and watch what happens.
A lot of people are going to be really angry today, a lot of people are going to be really worried about their futures and families today…a lot of people right here.
Regardless of my feelings/posts on what the future should hold for GM/Chrysler, I realize there are real people behind those logos.
/all the best today
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December 12th, 2008 at 8:52 am
It’s a kind of surreal Friday to be at an Auto supplier. The atmosphere in here is pretty weird this morning. But I have to be optomistic about this whole deal; maybe this is for the better overall.
Unless the UAW legacy costs are addressed, GM will never be competitive and profitable anyway. So kicking the can down the road now will probably just lead to more of the same – GM on perpetual life support, or no GM at all. At least ch11 will force the union issue to be addressed (unless Bush waives the white flag).
It will be a very dark day if we lose our domestic auto industry. But if it is not allowed to play by the same rules as the foreign owned competitors down south, it will continue to dwindle down to nothing anyway. So risking it all right now that the industry might thrive again really isn’t that bad an option.
If things don’t work out, I’ll just have to brush up the old resume and go get another job. Not the end of the world; in a couple years I’ll be back up to where I am now.
I’m sure the UAW guys will go find new jobs that are just as good, too. They are obviously worth it – just ask ‘em.
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December 12th, 2008 at 8:52 am
Perhaps the Senators will think of something today. Otherwise, filing for Chapter 11 is the only way they can move forward. I don’t think Bush should write the automakers a blank check to keep operating – they should just restructure under Chapter 11.
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December 12th, 2008 at 8:52 am
It’s easy to cheap shot and say “told you so” this morning. Things will work out and time will heal.
Many Americans work for modest pay. Many have no pension. Many pay $3000 a year for (average) family insurance.
The vote down of the bailout went in favor of the average American. And it signals the world that we are not going to let the dollar slide via over printing.
The incoming administration, with it’s focus on (re) organizing, is exactly what is needed now. Thank God we don’t have another war president lined up for tank battle.
=D~
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December 12th, 2008 at 8:57 am
On CNBC, they are reporting the only person that can save the American Auto Industry is George W. Bush. He can take the money out of the 350 billion remaining for the Banks or from the 25 Billion allocated for the auto industry to manufacture fuel efficient vehicles CAFE. He does not need congress or anyones approval. Will George W. Bush save the auto industry?
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December 12th, 2008 at 9:02 am
#55 RB
The whole union vs. management mentality is not healthy. It’s supposed to be the company vs the competition. When so much efforts goes into fighting a zero sum game, each fighting for their share of a shrinking pie, it’s not suprising to see a downward spiral.
Not saying it’s the unions fault. But for unions and their companies to survive, their gonna have to find a way to get past that mentality.
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December 12th, 2008 at 9:02 am
60 Statik:
based on the supplier reactions earlier this week…even if they find funding somewhere I think enough suppliers/creditors will head to the courts and force them into bankruptcy. What do you think?
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December 12th, 2008 at 9:09 am
Intel is considering jumping into car batteries. Probably a long shot there, but the fact that it’s even considered suggests there’s a business case for it….which means profits. And where’s there’s profits, there’s a market.
http://www.engadget.com/2008/12/12/andy-grove-pushing-intel-to-manufacture-electric-car-batteries/
You know it’s a down day when that makes me feel better. But it is a good reminder that electric vehicle technology has come of age and is coming on strong. This crisis is a speed bump that slows it down….but it’s still coming. Just keep your eyes on the prize.
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December 12th, 2008 at 9:11 am
truthguy Says:
December 12th, 2008 at 2:33 am
‘If the Republicans in the Senate kill this and GM and Chrysler go down for the count, then there will be hell to pay. The Republicans will be the party who destroyed the American Auto Industry. They will be finished in the Mid-West for at least 20 years. The Republicans have often been called the “stupid party”. They continue to prove it over and over again.’
GM killed GM. End of story. They are responsible for their own actions over the last few decades, not the Republicans or anyone else in power. If GM was running a business properly, there would be no need for a loan or a bailout. You’re like a man firing blindly into the air.
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December 12th, 2008 at 9:11 am
If GM goes bankrupt for a few months, and comes out a leaner much more efficient machine. Seriously that really doesn’t sound that bad. They will be able to break their expensive union contracts, shed the excessive bad debt, And simply be a more efficient & more competitive player.
Hell, they would be a healthier company than just using the billions to stave off the inevitable.
Looks like the UAW shot themselves in the foot. My union is not dumb enough to destroy the hand that feeds them. Apparently the UAW is?
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December 12th, 2008 at 9:12 am
I’m not a big fan of unions, but a couple of facts from the Senate hearing did catch my attention:
1) Labor costs are only 10% of GM’s expenditures.
2) Even if they worked for free, GM would still be in trouble.
It doesn’t seem like the UAW is the main problem here. I don’t know what happened in the final negotiations, but the UAW did seem willing to make significant concessions during the Senate hearing.
I suspect there is some other reason Republicans want GM to go bankrupt, and pushing the UAW too far was just the cover story.
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December 12th, 2008 at 9:18 am
#66 Morgan said,
Statik, based on the supplier reactions earlier this week…even if they find funding somewhere I think enough suppliers/creditors will head to the courts and force them into bankruptcy. What do you think?
======================================
Right now the White House is trying to stop that, they are leaving the door open, ‘if concessions are made’ they may have to step in and alleviate.
If the suppliers lose reasonable hope they will close in immediately. It is unclear how many are already starting the process. GM has faced a couple suppliers that have already put them on COD, I would think at the very least almost ALL suppliers would be demanding that arrangement.
UAW has a press conference at 10.
/still impossible to project how this day ends with the gov’t going back and forth and the UAW not giving the ‘official word’ they won’t reconsider…we all just have to watch it unfold
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December 12th, 2008 at 9:20 am
# 47 You want a serial plugin hybrid like the Volt?
buy a MINDSET:
Sorry, not for sale in the US.
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December 12th, 2008 at 9:25 am
#65 Cautious Fan said “The whole union vs. management mentality is not healthy. It’s supposed to be the company vs the competition. When so much efforts goes into fighting a zero sum game, each fighting for their share of a shrinking pie, it’s not suprising to see a downward spiral.”
===========================================
Yes I agree. For there to be a good relationship, communication and respect have to flow both ways. A union can be a part of that process. Relationships are not automatically antagonistic. In fact unions sometimes do a lot of things in terms of training and selection that are highly beneficial to the company as well as workers.
It is an unfortunate historical fact that management – union relationships at the auto companies have been rocky, and they do not seem to be able to get out of that trap. It is one of the things that keeps them at a disadvantage as compared to the Japanese companies.
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December 12th, 2008 at 9:26 am
#69 Joe OBrien Says: “If GM goes bankrupt for a few months, and comes out a leaner much more efficient machine. Seriously that really doesn’t sound that bad.”
————————————————————————————-
Many people won’t buy a car from a bankrupt company. Numerous studies confirm this. So while bankruptcy is a good thing for other businesses, it’s a recipe for disaster in the car industry.
Also, if GM goes Chapter 11, then the government would still need to loan them money for that to be effective.
The structure of the auto industry makes bankruptcy not attractive. Most automobile parts suppliers sell to many car manufacturers. If GM goes Chapter 11, then GM won’t have to pay their bills, which means the parts suppliers don’t get paid. This causes a ripple effect throughout the whole industry. In the current economy, this would likely cause Ford to fail as well.
Let’s just hope the president Bush gives GM some money from the TARP fund. Any other path gets ugly fast…
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December 12th, 2008 at 9:35 am
This vote must have been contentious with the Republicans, 9 of them abstained from voting.
Three of the most prominent Democratic Senators, Vice President Elect Joe Biden, Ted Kennedy, & John Kerry abstained as well; I guess they don’t want us to know who they’re loyal to.
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December 12th, 2008 at 9:37 am
Interesting that Ford is relatively stable and will seek no funds offered in any bailout package, yet GM and Chrysler are plummeting with greater velocity each day. Hmmmm…..?
You can blame the UAW for this crap. 78/hr for American auto workers to 48/hr for companies like Toyota…….they want a Merry Christmas? Take a pay cut. It’s that or lose your job. What would you do?
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December 12th, 2008 at 9:41 am
#67 Cautious Fan Says: “Intel is considering jumping into car batteries…
http://www.engadget.com/2008/12/12/andy-grove-pushing-intel-to-manufacture-electric-car-batteries/
————————————————————————————–
Very interesting. Thanks for the link!
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December 12th, 2008 at 9:43 am
Once this “bailout” drama settles down. We here at gm-volt can get back to E-REV / hybrid / and alternative transportation issues. Let’s see what rises from the events of this week. Who will step up to seize the E-REV mother load? Who will break the latest information on the development of the newest, lightest, strongest battery technology.
I believe the fun has just begun.
=D~
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December 12th, 2008 at 9:44 am
I just cannot believe it. I thought for sure that our legislators would put aside their differences and give the Big three a loan. They vote to GIVE 700 billion to evil and corrupt banks but cannot locate the testicular fortitude to help out our automakers, auto workers and their supply chain. Our government is totally worthless and I wish we could fire all of them!
A bleak Christmas it will be. Will there ever be a Volt?
http://oilfreenow.blogspot.com
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December 12th, 2008 at 9:53 am
Treasury now says they are willing to back the Detroit automakers to the new administration. Still nothing concrete though. (Paulson’s cred takes another hit, lol).
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December 12th, 2008 at 9:54 am
“The Seante fell short of the necessary 60 vote to consider teh lefislatiogn,”
C’mon, I think we can do a better job at proofing your posts, Mr. Dennis.
In any case, this failure to assist the struggling American automakers to survive and become more competitive is embarrassing. I’m wondering like Iaccoca, Where did all the leaders go?
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December 12th, 2008 at 9:55 am
#75 Guy Incognito Says: “This vote must have been contentious with the Republicans, 9 of them abstained from voting.”
————————————————————————————–
The point is that the votes weren’t there. The role call was just a way to get them on record. Senators who aren’t worried about getting re-elected don’t have to deal with that, so they abstained.
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December 12th, 2008 at 10:01 am
Bush on Air Force One just said he is now willing to use part of the original $750 billion emergency fund to support the auto makers.
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December 12th, 2008 at 10:04 am
Isn’t it funny how their wall street buddy’s got the money, but average American jobs mean nothing?
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December 12th, 2008 at 10:05 am
The ever popular van. EV family van?
http://garfwod.250free.com/Photos/1_evan1.jpg
http://garfwod.250free.com/Photos/1_evan2.jpg
=D~
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December 12th, 2008 at 10:10 am
On a positive note:
1997 Nobel Laureate in Physics, Dr. Steven Chu has been chosen as Obama’s US Secretary of Energy.
Here is Dr. Chu, Director of Lawrence Berkeley National Laboratory speaking at EV worlds annual Meeting of the Minds conference in Oakland in 2007.
http://www.evworld.com/EVWORLD_TV.CFM?storyid=1354
A little background on Dr. Chu:
The co-winner of the Nobel Prize in Physics in 1997, Dr Chu has directed his team of scientists to focus on technologies to help tackle the threat of global warming, especially along the lines of energy research. In the above 40+ minute address in Oakland, CA he describes various avenues of research LBNL scientists and others are pursuing to come up with sustainable transportation fuels from investigating the cellulose digesting microbes in the guts of termites to the fabrication of artificial plants that could improve on Mother Nature
Here is Dr Chu at the 2008 National Energy Summit
http://www.youtube.com/watch?v=GfLaQUD86Mw
Question:
Where should we put our (estimated $125 Billion) tax money? Should we put it into NEW research into world leading energy technologies and finally get off oil or should we put it into bloated, poorly managed 100 year old car companies who will come back for $Billions more in 3-4 months?
(hint: Bankruptcy restructuring with gov’t backed new car warranties WILL fix legacy & restructuring costs and our tax money can fund R&D into NEW technologies to really FIX our energy problems.)
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December 12th, 2008 at 10:11 am
Anyone notice on the roll call above, Reid voted ‘Nay’ ? Why would that be ? Not stirring the pot here; that just made me scratch my head.
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December 12th, 2008 at 10:14 am
A step in the right direction.
http://garfwod.250free.com/Photos/1_dev1.jpg
http://garfwod.250free.com/Photos/1_dev2.jpg
This car would look great in midnight purple.
example: http://garfwod.250free.com/Photos/2002kawasakizx12rpurplestars.jpg
=D~
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December 12th, 2008 at 10:40 am
If they are going to play the “wage game” do it all the way.
That means everyone (including lutz). And wage is TOTAL COMPENSATION not $1 wage and 2 mil in incentives/bonus/stock options!
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December 12th, 2008 at 10:53 am
DB Cooper (#87)
Question: Why did Reid vote Ney.
Answer: Not enough pork.
(he should have voted oink)
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December 12th, 2008 at 10:57 am
Dave K #88,
I see that as a competition with the Tesla Roadster.
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December 12th, 2008 at 11:06 am
DB Cooper (#87)
Question: Why did Reid vote Ney.
The Governor of Illinois could answer your question..
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December 12th, 2008 at 11:15 am
Huzzah! Finally, some common arrived and this disater was killed off. GM will file Ch11 and the Volt will be made rest assured. The UAW will see paycuts and their overly generous health-pension system revert to what the rest of us have. The sky will not fall.
Hurray for conservatives and the anti-socialist crowd finally showed their face. It is sad day this has happened but we no one but government growing and invading public sector politians for this mess.
Now reduce CAFE standards
Let US Auto import the high mileage they can sell oversees here that they are illegally prevented from doing.
Let the Big 3 restructure like every other US company is doing right now.
I love the Volt and buy GM vehicles only. I don’t want it to go away, but socialism isn’t the answer. May the stock holders stand up to GM now.
As I have said before, it will take a minimum of 5 years (using Lutz’s on words) before cars like the Volt can even think about making a profit. We need oil driven cars (diesel, gas) for another 10+ years (either Hybrid or straight up only gas/diesel)!
Give Hydrogen power and the Volt as the future platform, but give oil and two phase hybrids today.
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December 12th, 2008 at 11:17 am
hi Rashiid Amul #91,
Wait til’ you see what is coming in the next 3 years. The days of the mid size family V6 sedan are waning.
Recent news highlights EV development. With cars sold as cheap printers and miles purchased (like cell phone minutes). The forecast is that the MPG (per gallon cost) equivalent to be very low.
The MIEV, E-REV Volt, cell battery sports cars, and base model EV due to be produced soon from China, are exciting. The Volt battery will come from Asia.
I just heard rumor of a 4x battery being produced from cheap, non explosive, materials. Same weight with four times the power.
http://garfwod.250free.com/Photos/1_elecwing.jpg
http://garfwod.250free.com/Photos/1_volt_display.jpg
=D~
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December 12th, 2008 at 11:18 am
Congressional Republicans force Bush to use TARP funds to save Detriot, something that Congressional Democrats could not get him to agree to. Do Congressional Republicans think that they will get a better deal from Obama and the Democratic Congress in February than Bush brought them yesterday? TARP funds, not green car funds? Pelosi 7, McConnell 0.
http://www.marketwatch.com/news/story/Treasury-stands-ready-assist-auto/story.aspx?guid=%7B081CBE42%2D3D1B%2D4884%2DB83F%2D2790DF2BB542%7D
Swiss banking execs do what Wall Street execs would not: giving back up to $80 million in bonuses for the debacle that occurred on their watch.
UAW doing what Wall Street execs would not: per Politico, UAW willing to take the pay cuts by 2011, just not next month. Anyone here remember that Bush and Congressional Republicans said that cutting golden parachutes for millionaires was a deal-breakter? Apparently not immediately slashing wages for guys making $50K a year was a Republican deal-breaker as well.
UAW willing to do what bond holders were not: take up to 50% off the market value of what GM owes them in exchange for equity. UAW agreed to take 1/2 the retiree health insurance payments, and equity in a worthless company. This is money that Wagoner testified was already set aside and guaranteed, and which would likely have been 100% protected under Bankruptcy law and ERISA. In contrast, Corker stated during the hearings that bond holders were willing to take 30 cents a share, when the market was only offering them 15 cents a share, and when they would likely get 0 cents on the dollar in Bankruptcy. Further, MarketWatch (a Wall Street Journal-owned site) reported GM tried to get creditors (including bond holders) to take equity instead, and found few takers.
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December 12th, 2008 at 11:25 am
Hi Dave K #94
That wing car is absolutely gorgeous. Thanks.
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December 12th, 2008 at 11:41 am
This is not designed to be pro labor or management but to put work cost in perspective. Let ASSUME that there are 100 upper management peaple at GM getting a total of $100,000,000.00 dollars a year and their pay is cut to $1.00 each a year. and ASSUME the total sales of GM cars is 10,000,000 units. That would result in an additional profit for GM of $10.00 per car. The point is all partys must take a big hit in order for the United States car companys to become competitive. Sadly the largest hit is going to be the retirees. But on the brighter side, those in the job bank will be a thing of the past.
I will also say that I think the compensation that upper management recieves in most industries as in the case of auto manufacturing is VULGAR and most likely angers the UAW members to the point that logic goes out window.
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December 12th, 2008 at 11:52 am
I wonder if the average UAW hourly workers know how much their upper level union management peaple get in total compensation?
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December 12th, 2008 at 12:27 pm
The doom and gloom for the UAW I have seen on this site today is not the way it will be. Sure, with Chapter 11 the UAW will have to make concessions and new contracts will be drawn up. If the UAW does not accept the new contracts, the workers can still work as non-union employees. Work will go on while GM is going through bankruptcy. There will probably be a short time where the plants could be shut down at the beginning, but I doubt it. If GM comes out of C11 with non-union employees, all the UAW has to do is wait until the democrats pass the card check law Obama says he will sign. Once that happens the UAW just goes around to each GM plant worker after hours and gets them to agree to check the card saying they think there should be a union at the plant. Once 50% + 1 vote is for the union, the plant is automatically unionized and management must negotiate. If they don’t negotiate the government is required by law to force concessions from the company. Once that happens, the UAW is back in control of the plant again.
GM, Ford and Chrysler let the UAW get as strong as it is because of government requirements and actions plus they were afraid of a long extended strike hurting production. They gave in to demands by the government and the UAW over the years and now we are at this point.
No matter what happens with GM, Ford and Chrysler, short of them being desolved and permanently shut down, the UAW is not going away. They will just wait until their partner (government) passes legislation favoring them again.
I see no real change for wage and benefit parity in the future.
EDIT: This same card check law will also make it very easy to unionize the foreign automakers and many, many other companies. Unionism will be on a sharp rise in the next four to six years and there will be many plant strikes and shutdowns. You will find the government on the side of the union in every such situation. The companies in America will be at an extreme disadvantage with this new law.
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December 12th, 2008 at 12:37 pm
I am not pro-union or anti-union. I am for good wages and good working conditions. Government now has the authority to insure safe working conditions at all companies in America. Local competition for labor pools usually forces companies to pay better wages than they might otherwise.
My biggest complaint about unions is that the average union member pays those union dues month after month and gets less and less for his money. They have very little or none at all say-so over how the money is spent. I don’t think most union members would agree with their union managers on how to spend the dues money.
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December 12th, 2008 at 3:37 pm
90. Tim -
Question: Why did Reid vote Ney.
Answer: Not enough pork.
(he should have voted oink)
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Almost every day, I read something here that breaks up the gloom-and-doom and makes me literally laugh out loud. Today it was this .. voting ‘oink’! That’s priceless. lol
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December 12th, 2008 at 10:51 pm
I read an article today about what is an American car really? It stated that cars made by the big 3 comprise less than 50 percent of parts that are made in the USA. 80 percent of the parts that go into the Toyota Camry are made right here in the U.S. A further 56 percent of ALLToyota’s vehicles sold in here have that same 80 percent “made in the USA” ratio.
So, unless this article was mistaken, Toyota’s are more American than Fords, Chevys, and Chryslers. That’s pretty sad if you ask me.
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