Big 3 Automaker Bailout

A few responses...

Mr Clean, I was just saying people do not take home that amount and do not necessarily get all of it. It is overhead spread over the total work force. Iagree that in the end it becomes part of the equation on determining labor costs. For example, if you take the total government debt of the US spread it over the US population, you will see YOUR share of burden (earned or unearned).

I really like the words "free market" because in a purist sense we saw it on wall street. Greed (buying up what they knew were risky loans, not holding reserve against the loss, and thanks to credit swaps spread it around the world). Capitalism is all about greed andit is cruel to a lot of people. People point a China about all the poisonings but we were in a similar situation until the feds started regulating food, etc. what we now consider a good idea. We take for granted the laws we have that they do not.

I had a 1974 pinto. It seem to ride like a tank and never would idle well (the early days of emission controls) but it was basic transportation as long as you did not get hit in the rear. I totalled mine in a fairly low speed accident.

The American worker has proven they can build good cars....they have been building the foreign ones for some time. It is sloppy American engineering that is usually the blame (designing something that cannot be produced in a high quality, consistent manner). But, my Chevy Citation will always be the testament to being one of the poorest designed cars ever. No worker in the world could have save it. GM played so many games over the years and the lost the confidence of the people buying them. Once you lose the trust they do not come back. This is what branding is all about. It is more a the brand than the product many times.
 
Bunky said:
...

Mr Clean, I was just saying people do not take home that amount and do not necessarily get all of it. It is overhead spread over the total work force. Iagree that in the end it becomes part of the equation on determining labor costs. For example, if you take the total government debt of the US spread it over the US population, you will see YOUR share of burden (earned or unearned). ...
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But the worker does benefit either directly or indirectly from most of it. Call it cost avoidance, or whatever. So even though he/she doesn't necessarily deposit it in the bank he does spend it.
 
Bellydawg said:
In a free market system, a wage paid is what the market will bear. Now that wage may be based on experience and/or education, but should never be based on seniority.

Unions may have their place. I say may because I am not totally convinced. Unions were needed when the owners took advantage of the work force but are now a part of the problem.

One point that I don't recall being adressed is the UAW job bank. What a luxury to be able to come in to the union hall and collect a check for doing nothing (I know, the union is doing away with the program now).

Quality has also played a part. Is the quality better than in years past, possibly. Did I and others get burned by inferior products from the arrogant Big 3? You bet. They even tried with partnerships with Japanese manufacturers; i.e., Mercury / Nissan, Mazda, and brought those products down. And then when you have a warranty problem, they make it a burden to get it fixed. It is going to take more than a couple of sales and quality awards to get me back.
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First, the jobs bank was addressed, as it has to go, and during the Senate hearing, the UAW had said it would go. If you want to blame anyone for the jobs bank, blame the Japanese, where "lifetime employment" is still the rule more than the exception. In the 1970's and the 1980's after the Big Three and UAW got hammered for not being as efficient as the Japanese, the efficiency of the UAW went up. In return for the change in work rules (most of which were originally negotiated in as safety rules, and then morph into some featherbedding) and the increase in automation, the jobs bank was created to mimic the Japanese "lifetime employment". From management's perspective, it kept morale up while manual jobs were replaced with robotics, and it kept trained employees on hand to move into open positions as attrition created openings. The problem came as market share was lost, and past restructuring closed plants.

As far as quality, there are plenty of proof that the import brands have their problems, even in cases where they have had no connection to any other automaker. Personally, I resent the comment about bring the import brands down. Pure nonsense. The Mercury Villager/Nissan Quest joint venture minivan was mostly engineered by Nissan. And the next generation Titan pickup truck will be built by Chrysler, on the Dodge Ram chassis.

Quality? Like Toyota's engine sludge problems that go back over ten years? Toyota Sludge Zone read the Automotive News story link.

How about Mercedes? Mercedes Benz Lemon Problem Vehicles
 
lol talk to anyone who owned a VW - I know people with Jetta's who had to permanently get their back windows weled up as the only way to stop them from rolling down "unattended"

I had two toyota celicas - the first shot a spark plug through the hood, the second had no less than 7 tsb's in 3 years.
 
I got a question. The big three auto makers were asking for a loan? Correct? If we look back a few months the banking industries and the thieves running them came before congress and didnt ask for a loan they asked for a hand out which our benevolent leaders gladly gave them a blank check to do with what they pleased. Dont get me wrong, I'm not in favor of giving out my hard earned tax dollars away to the car industry either but lets be fair the shiesters from the mortgage companies and the banking industry started all this.
 
sjr said:
I got a question. The big three auto makers were asking for a loan? Correct? If we look back a few months the banking industries and the thieves running them came before congress and didnt ask for a loan they asked for a hand out which our benevolent leaders gladly gave them a blank check to do with what they pleased. Dont get me wrong, I'm not in favor of giving out my hard earned tax dollars away to the car industry either but lets be fair the shiesters from the mortgage companies and the banking industry started all this.
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I guess if they do go bankrupt, then each taxpayer will get a car for free at the liquidation.
 
WASHINGTON - Flanked by officials from the United Elf Toytinkerers union, SantaCorp CEO Kris Kringle today told the House Ways and Means Committee that without immediate government financial help, his firm would be forced to declare bankruptcy, lay off thousands of elves and reindeer, and potentially cancel its annual worldwide Christmas Eve toy delivery.

"These are grim economic times for everyone, but even more so for non-profit toy manufacturers in the Snow Belt," said Kringle. "Our accountants have indicated that we are on track to exhaust our reserves of cash and magical pixie xxxxxdust by December 23. Oh deary me."

Kringle and UET union president Binky McGiggles presented a draft emergency bailout plan to the committee calling for US $18 trillion in federal grants, loan guarantees, and sugarplum gumdrops that they said would keep the company solvent through December 26.

"We believe this proposal shows that management and labor can work together to craft a reasonable, financially responsible short-term survival plan," said McGiggles. "After the new Congress is seated in January, we would be happy to return to present a long-term package to get us through April."

Kringle warned that failure to approve the plan would have dire global economic consequences.

"Oh goodness," said an emotional Kringle, fumbling with his glasses, "think of all the children who will wake up sad and angry and confused on Christmas morning, with nothing in their stockings. Let's just say I wouldn't want to be their parents. Or a someone answering your switchboards on December 26."

SantaCorp, which lost over $2 trillion in FY 2007, has seen a steady erosion in market share and profitability over the last five years. Industry analysts say that its precarious position is due to a number of factors.

"You might say it's a perfect snowstorm," said Merrill Lynch analyst Jennifer Rothstein. "The youth consumer market is demanding more for less, at a time when the government and courts have forced SantaCorp to lower its 'good list' credit rating standards. They face increased non-union competition from the East Pole, and huge increases in fuel prices for magical reindeer flying hay. It's a hard sell for the investment community."

Veteran market watcher Charles Kessler of ToyWeek said SantaCorp's labor cost structure was a significant factor in its recent struggles.

"After the 1982 strike SantaCorp offered the UET a generous pension plan promising free lifetime candy canes and unicorns," explained Kessler. "It seemed like a good idea at the time, but the company accountants forgot to factor in elf immortality."

Despite the dire picture painted by Kringle and union officials, they encountered skeptical questioning from some committee members. Several members slammed the SantaCorp officials for flying to the hearing on a private luxury sleigh, while others openly questioned the company's business model.

"Almost every business in my district has had to adjust to the new economic climate, but SantaCorp seems to believe it can continue with the same old profligate giveaway business-as-usual," said Paul Ryan (R-Wisconsin). "I'm sorry for your situation, but it is difficult to justify giving trillions of US taxpayer dollars to a private company that is outmoded, headquartered offshore, and, frankly, imaginary."


Kringle defended the company's business practices and his reported 4 billion cookie annual salary, saying that the company was "doing the best we can under trying circumstances." He also blamed the company's struggles in part on federal environmental and safety regulations.

"Frankly the amount of paperwork you require is astronomical," said Kringle. "OSHA inspections and reporting requirements have doubled our factory production cycle, and every time I tramp a little fireplace soot into a living room I have to fill out three separate EPA environmental impact reports."

Kringle also urged the committee to enact industry tort protections, saying that the company remained saddled with crushing legal and insurance bills following the landmark 1974 class action liability case Nader v. Jarts, Clackers, SantaCorp, et al.

UET President McGiggles warned that failure to pass a bailout package would have dire social consequences.

"All of you have seen the bleak pictures of how plant layoffs have already effected ToyTown -- the boarded-up gingerbread houses covered in frosting grafitti, the abandoned sleighs up on blocks, the widespread crime and sucrose abuse, the antler-wielding gangs of unemployed reindeer yearlings," said McGiggles. "That is only a hint of what is to come if the plant shuts down. If you think an industry bailout is expensive, well, just consider the cost of a full-scale violent rioting by millions of desperate unemployed elves, with warehouses full of surplus BB guns."

House Ways and Means committee chairman Charles Rangel (D-New York) motioned to end the hearings, saying that with only 7 bailout shopping days before Christmas the committee needed to move on to other industries facing emergency financial crises.

"The American economy and Christmas itself stand on the edge of disaster, It's time for my colleagues show we are good boys and girls," said Rangel, who is reported to have received over $6 million in campaign contributions from SantaCorp and the UET over the last two years.

A full House vote on the SantaCorp is scheduled Friday morning, where it is expected to pass by a comfortable margin. President Bush has pledged to sign any and all bailout request from Congress until the end of his term, "no queshnions ast."

"I want to insurer the American People and the evil doers that I and the Crongress and the Hankster [Treasury Sec. Paulsen] and Big Ben [possibly Fed Chair Bernanke] and [unintelligible] and me are unineted together to approve the financial aid and regulations and federal takeovers to get our American free ennerpise system back on track," said the President, speaking from inside his new shoe-proof plexiglas enclosure.

In concluding the hearings, Rangel gave the SantaCorp officials a personal vote of confidence.

"We believe in you, Santa," said Rangel, handing Kringle what appeared to be a list. "As long as you continue to believe in us."
 
Mr. Clean said:
I agree the quality issue (or lack of) with the Big 3 might be a perception problem. Though I do still have my doubts about Chrysler products. But that problem was self inflicted. It will take some time to gain back the trust of the car buying public. They will have to produce top quality products which deliver more than the public wants (not expects as we know expectations are low). When problems arise, they must be dealt with swiftly and aggressively making the owner fully aware that their satisfaction is the company's utmost concern, not just an advertising slogan. Can it be done? Yes. The American workers can deliver.
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I couldn't agree more, on all counts. I've often told those of my family, in the Detroit auto business, that the Detroit automakers will have to over deliver for many years to undo the perception that half the market has, that they don't measure up. They can do, I'm pretty certain Ford is getting their, GM is improving, but I'm not certain about Chrysler. Daimler really gutted their product development department.

Mr. Clean said:
Funny, my Wife had a '74 Pinto (2-door hatchback) when I married her. She had purchased it used. Other than a paint issue on one small section of the hood (I believe it was a spot re-paint - that was generally well done), I don't recall any problems with that vehicle.

Edit to add: No doubt that service (maintenance and repair) after the sale provide a significant amount of income for a dealership.
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So did my Dad. Drove it daily to work for years. Just needed oil changes. He bought it new and would have still had it, except for the guy who rear ended him and total it.
 
Mr. Clean said:
I agree the quality issue (or lack of) with the Big 3 might be a perception problem. Though I do still have my doubts about Chrysler products. But that problem was self inflicted. It will take some time to gain back the trust of the car buying public. They will have to produce top quality products which deliver more than the public wants (not expects as we know expectations are low). When problems arise, they must be dealt with swiftly and aggressively making the owner fully aware that their satisfaction is the company's utmost concern, not just an advertising slogan. Can it be done? Yes. The American workers can deliver.
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Bellydawg said:
When I bring in a part to be replaced at a dealership and they say, "Oh yes, that's a known problem with that model", I get ticked. Why aren't they fixed. Because the parts business is more lucrative than the sales business.
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As bellydawg pointed out, they know that there is a problem, and not just american makes, the imports will do the same thing because they don't want to admit to a design flaw, generally they just try to incorporate it into the next years release.

I can say that not all manufacturers learn from this.
I am responsible for a small fleet of trucks, 2 of them are late model Ford LCF's (an 06 & 07) both of these vehicles have had to be towed back to Ford more than once, both of these had to have their fuel tanks replaced due to they delaminated (in both cases I was given an excuses on why it wasn't a warranty issue) at close to 2500 a pop it gets reals costly.

They have know fuel system issues (the 06 was recalled in less than 2 months) the 07 has gone in for similar repairs.
Even if all the repairs were covered under warranty, these are delivery vehicles. Every day that they don't run my company is loosing money, I am forced to go and rent a truck to do the work. To make matters worse we own these things, now the man who owns the company has already told me to get rid of these things, he is sick of hearing that his trucks are down.
We are working on a way to get rid of these white elephants and replace them with something more reliable.
Where everyone else is laying off or cutting back I was told to go out and look for another truck and look into 2 new work vans.
Sadly, I won't be looking to ford for my new truck, but with the state of the other 2 manufacturers I may be stuck getting a ford van.

For the record I am not a ford hater, I have proudly owned a half dozen of them. It's just sad to see that they are really starting to live up to Found on road dead:(

<End rant>
 
jaybs02 said:
As bellydawg pointed out, they know that there is a problem, and not just american makes, the imports will do the same thing because they don't want to admit to a design flaw, generally they just try to incorporate it into the next years release.

I can say that not all manufacturers learn from this.
I am responsible for a small fleet of trucks, 2 of them are late model Ford LCF's (an 06 & 07) both of these vehicles have had to be towed back to Ford more than once, both of these had to have their fuel tanks replaced due to they delaminated (in both cases I was given an excuses on why it wasn't a warranty issue) at close to 2500 a pop it gets reals costly.

They have know fuel system issues (the 06 was recalled in less than 2 months) the 07 has gone in for similar repairs.
Even if all the repairs were covered under warranty, these are delivery vehicles. Every day that they don't run my company is loosing money, I am forced to go and rent a truck to do the work. To make matters worse we own these things, now the man who owns the company has already told me to get rid of these things, he is sick of hearing that his trucks are down.
We are working on a way to get rid of these white elephants and replace them with something more reliable.
Where everyone else is laying off or cutting back I was told to go out and look for another truck and look into 2 new work vans.
Sadly, I won't be looking to ford for my new truck, but with the state of the other 2 manufacturers I may be stuck getting a ford van.

For the record I am not a ford hater, I have proudly owned a half dozen of them. It's just sad to see that they are really starting to live up to Found on road dead:(

<End rant>
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J sorry to hear of you headaches ..when I went looking for a van in 2003 I talked to many of the other vendors I deal with during the year, many who like you depend on their vehicles to keep their business going ... the choice came down to the GMC Savana and the new Sprinter (at that time).
I bought the GMC w/ the 6.0 and it has not let me down ... my friend who also bought one but the 3500 series has also had no problems almost 6 years later. I have known a few people with the Sprinters and all of them are totally satisfied (mercedes design and power train) and they also get great gas mileage with the diesel ... good luck on the replacement :cool:
 
Poorboy said:
J sorry to hear of you headaches ..when I went looking for a van in 2003 I talked to many of the other vendors I deal with during the year, many who like you depend on their vehicles to keep their business going ... the choice came down to the GMC Savana and the new Sprinter (at that time).
I bought the GMC w/ the 6.0 and it has not let me down ... my friend who also bought one but the 3500 series has also had no problems almost 6 years later. I have known a few people with the Sprinters and all of them are totally satisfied (mercedes design and power train) and they also get great gas mileage with the diesel ... good luck on the replacement :cool:
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I was looking at the GMC's, I have had a number of them and they were extremely reliable, the only thing is will GM be around in 4 years? I've had sprinters in the past and have one now. As for the drive train... very reliable, the rest of the truck may fall apart and they are costly to repair, but you are right about being good on fuel and very maneuverable for something it's size.
 
jaybs02 said:
I was looking at the GMC's, I have had a number of them and they were extremely reliable, the only thing is will GM be around in 4 years? I've had sprinters in the past and have one now. As for the drive train... very reliable, the rest of the truck may fall apart and they are costly to repair, but you are right about being good on fuel and very maneuverable for something it's size.
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I would go with the GMC's and GM will be around for years to come they just may look a bit different.
Also be careful with the smaller engines offered as they are the ones that have longevity issues, the 2500 & 3500 series are overall better vehicles ;)
 
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