Romney: "Let Det. go bankrupt"

[jafo]

Oh really? Look at what Ford has done WITHOUT filing Ch. 11:

 

* Helped dealers consolidate: http://www.silive.com/news/index.ssf/2008/...rs_work_on.html

* Bought out workers: http://blog.mlive.com/annarbornews/2008/01...early_reti.html

* Negotiated new work rules: http://www.cleanmpg.com/forums/showthread.php?t=811

* Got the UAW to authorize mid-contract concessions: http://www.factoryrat.com/factoryrat/modul...topic&t=599

 

So but me no buts about what can and can't be done outside of bankruptcy.

 

Bankruptcy is the coward's way out.

Yes it can be done without going chap 11 and if gm had started doing these things several years ago, we probably would not be having this conversation. Right now they dont have cash needed to deal with dealers and UAW is said they have already given enough.

 

And seeking a govt bailout with no strings is a noble way to run a business?

Edited November 21, 2008 by jafo

[jafo]

doubtlpost..

Edited November 21, 2008 by jafo

[NickF1011]

And seeking a govt bailout with no strings is a noble way to run a business?

 

I don't think anyone is seeking a no-strings loan. There is a lot of contention about what those strings should be though.

[akirby]

Alabama gave 'socialist' incentives to get foreign car plants, so yeah they get bribes.

 

That's not socialism, it's a simple investment. In exchange for local and state tax breaks they get a new factory that employs hundreds or thousands of people. Those people pay taxes, buy goods, etc. The net effect to the local and state economy is positive. It's a win-win situation.

 

I think Ford should think about that the next time they decide to build a new plant or do a significant overhaul of an existing plant. It just makes good business sense.

[NickF1011]

That's not socialism, it's a simple investment. In exchange for local and state tax breaks they get a new factory that employs hundreds or thousands of people. Those people pay taxes, buy goods, etc. The net effect to the local and state economy is positive. It's a win-win situation.

 

I think Ford should think about that the next time they decide to build a new plant or do a significant overhaul of an existing plant. It just makes good business sense.

 

So wouldn't a bailout of Detroit be an investment also? Hell, just the unemployment payouts the government will make after millions lose their jobs would probably cost more. And with all of those people out of work, the government won't collect income tax from them. More lost revenues.

[mlhm5]

The Financial Times estimates that if US vehicle density stops growing and Detroit can stabilize its market share around 48% (down from 75% in the 1980s), then there is a market for only 6.5 million cars from the Big 3 in the United States.

 

That's down from 9 million just two years ago and hardly enough sales for D3 to survive unless they are very successful in penetrating the Chinese and Indian market where the number of cars per 1000 people is not 981 like the US but in the low teens or twenties.

 

Of course selling 6.5MM cars is dependent on an economy that is not in recession and there is no further loss in market share.

Edited November 21, 2008 by mlhm5

[V8-X]

No comment other than Romney is a stooge.

[kpc655]

Oh really? Look at what Ford has done WITHOUT filing Ch. 11:

 

* Helped dealers consolidate: http://www.silive.com/news/index.ssf/2008/...rs_work_on.html

* Bought out workers: http://blog.mlive.com/annarbornews/2008/01...early_reti.html

* Negotiated new work rules: http://www.cleanmpg.com/forums/showthread.php?t=811

* Got the UAW to authorize mid-contract concessions: http://www.factoryrat.com/factoryrat/modul...topic&t=599

 

So but me no buts about what can and can't be done outside of bankruptcy.

 

Bankruptcy is the coward's way out.

 

Great. But the fact remains..it wasn't enough.

 

I'd say begging in Washington for taxpayers to support a failing business is the coward's way out. Particularly when the business leaders don't even have the balls to include criticism of contributing government policies in the discussion.

[blazerdude20]

mitt is a moron in general. but in theory bankruptcy is a great idea as it would allow gm to restructure/kill off their brands, union contracts, and dealers.

 

guess what though theory is not reality, and the reality is no one wants to buy a car from a bankrupt automaker. if gm did file ch.11 they would either die entirely or would have to be subsidized by the gov for a few years.

 

i wonder if 25b costs less then years of subsidizing gm, and possibly ford and chrysler? i bet it is.

[Bored of Pisteon]

mitt is a moron in general. but in theory bankruptcy is a great idea as it would allow gm to restructure/kill off their brands, union contracts, and dealers.

 

guess what though theory is not reality, and the reality is no one wants to buy a car from a bankrupt automaker. if gm did file ch.11 they would either die entirely or would have to be subsidized by the gov for a few years.

 

i wonder if 25b costs less then years of subsidizing gm, and possibly ford and chrysler? i bet it is.

 

If I were in a position to buy a new vehicle. Especially from an automaker in bankruptcy. I'd stick with Ford because they still have what I want. GM offers me very few choices, except a few vehicles in their Saturn line, and a Buick or two. or maybe, a Pontiac Vibe. That's it.

 

Chrysler vehicles lately look like Lego built toys with wheels on them. NO THANKS!

[battyr]

The government has collected huge taxes on the industry over the past several years. The industry contributed to huge wages, which resulted in even higher taxes. The government let the Japanese into the market, while the Japanese government was protecting their own industry.

 

Now that the automove troubles are putting fear into the economy just when it needs hope the most, the government needs to take decisive action now.

 

I do think the government should let GM go under, to strengthen the rest of the industry. But not now! We can't wait until Obama takes over to get the economy back on track.

 

Every time the government does nothing in response to a crisis, fear drives things worse, the cost of a recovery doubles up. We are not talking about a few auto workers. This thing is hurting every single person on the planet. We are not sitting in the 30's with no understanding of economics. Economist know what is happening and how to get out of it.

 

I knew about the subprime crisis 2 years ago. The government did nothing. 1 year ago the banks started taking a major hit. The government did nothing.

Last spring I knew that all the inflation in the economy was caused by high oil prices. I knew that oil prices was going to drop. But not this much. And inflation was not an issue. The Fed. was only concerned about inflation. Now we have deflation.

 

Last summer the only real problem we had in the economy was fear. Now we have a lot more fear and real economic problems. We can't wait until January.

 

The government must take action now. Stop the fear now.

[NickF1011]

The Financial Times estimates that if US vehicle density stops growing and Detroit can stabilize its market share around 48% (down from 75% in the 1980s), then there is a market for only 6.5 million cars from the Big 3 in the United States.

 

That's down from 9 million just two years ago and hardly enough sales for D3 to survive unless they are very successful in penetrating the Chinese and Indian market where the number of cars per 1000 people is not 981 like the US but in the low teens or twenties.

 

Of course selling 6.5MM cars is dependent on an economy that is not in recession and there is no further loss in market share.

 

This is your new name:

 

 

What the hell does your post have to do with the current discussion? Freaking negatard loser.

[mlhm5]

This is your new name:

 

 

What the hell does your post have to do with the current discussion? Freaking negatard loser.

 

The reality is that D3 are in a lot more trouble than a $25 billion loan can cure, and that article points it out very clearly.

 

Ford was losing market share before the economic crisis and there is no way of knowing if 48% is too low or not and if the market will ever return to 15MM cars.

 

Romney only said what he said because he is the biggest flip-flopper in politics today.

[NickF1011]

The reality is that D3 are in a lot more trouble than a $25 billion loan can cure, and that article points it out very clearly.

 

Ford was losing market share before the economic crisis and there is no way of knowing if 48% is too low or not and if the market will ever return to 15MM cars.

 

Romney only said what he said because he is the biggest flip-flopper in politics today.

 

If you refer to "15MM" again I'm going to petition to have you suspended.

[blazerdude20]

The reality is that D3 are in a lot more trouble than a $25 billion loan can cure, and that article points it out very clearly.

 

Ford was losing market share before the economic crisis and there is no way of knowing if 48% is too low or not and if the market will ever return to 15MM cars.

 

Romney only said what he said because he is the biggest flip-flopper in politics today.

 

better to have a smaller market share and be profitable then to have a large share of the market and lose money.

 

ford has been working towards the first option, while gm has been sticking with the latter. which has bit gm in the butt and now could take ford with them.

[mlhm5]

It is not to the advantage of Honda, Toyota, Nissan and every other car company for D3 to go into bankruptcy.

 

Toyota could have done that a few years ago by using the Rockefeller Strate (taking a loss for a period of time and undercut the big 3 to sink them).

 

Their profit margin per vehicle are so skimpy that Toyota could easily done it.

[akirby]

So wouldn't a bailout of Detroit be an investment also? Hell, just the unemployment payouts the government will make after millions lose their jobs would probably cost more. And with all of those people out of work, the government won't collect income tax from them. More lost revenues.

 

Not exactly - you're talking about simply retaining an existing base of jobs taxpayers versus adding totally new jobs and corporate taxpayers. Retention versus growth. Additionally, if the employees find jobs anywhere else in the country, the federal government still gets income taxes. However, the local counties and state won't get anything if the employees move out of that state.

 

Similar argument but not quite apples to apples.

[NickF1011]

Toyota could have done that a few years ago by using the Rockefeller Strate (taking a loss for a period of time and undercut the big 3 to sink them).

 

Umm. That is illegal.

[F150 Man]

Jim Cramer said last night on his show, that it's too late for a bailout (bridge loan). That the industry must reorganize in chapter 11, and Chrysler might not make it out the other side.

 

Now before the flames fly, I know Cramer is to put it mildly a bit eccentric (idiot savant), however, he has a keen directional sense of where things are going.

 

I believe the industry can indeed pour $25B down the 'hole', without anything backing up.

 

We are beyond surgery; an amputation might save the patent.

[Fordowner]

Dems are saying Bankruptcy is not an option. Senator Dodd anounced today that he is meeting with auto related industry people in his state to see how all this effects the economy. Below. I guess the ill will built up by the big 3 makes taking 25 billion for the big 3 of the 700 billion for Wall Street more difficult.

 

So the Dems it looks like are just trying to cover their backsides and get better press spin for Detroit after Dec. 2. Probably smart - if your an attorney negotiating a settlement you don't talk the client into accepting it, even though you know they should, you walk away and then come back and make it looking like a better package. And frankly if they can state up front the accountability measures for these loans then it probably is a better package.

 

I think it will happen after Dec 2. Though I do wonder about when the economy will ever get better. but in times of recession deficit spending is not a bad thing.

 

http://biz.yahoo.com/ap/081121/dodd_autos.html?.v=1

Conn. Sen. Dodd meeting on auto industry crisis

Friday November 21, 1:06 pm ET

Sen. Dodd meeting with dealers, suppliers for input on proposed auto industry rescue plan

 

 

HARTFORD, Conn. (AP) -- After listening to top auto industry executives make their pitch for help, <cut> meeting in Hartford Friday afternoon involves those who own Connecticut auto dealerships, those who supply the auto industry with products and labor representatives.

 

Dodd says he wants to learn firsthand from them about how the nation's economic crisis is affecting their business.

Edited November 21, 2008 by Fordowner

[battyr]

Jim Cramer said last night on his show, that it's too late for a bailout (bridge loan). That the industry must reorganize in chapter 11, and Chrysler might not make it out the other side.

 

Now before the flames fly, I know Cramer is to put it mildly a bit eccentric (idiot savant), however, he has a keen directional sense of where things are going.

 

I believe the industry can indeed pour $25B down the 'hole', without anything backing up.

 

We are beyond surgery; an amputation might save the patent.

 

When this whole thing is over, $1,200 Billion would be spent on saving the banks. If it is not stopped, the same would have to be spent on saving other different industries. Total government cost for unemployment and lost tax revenue over many years will equal $10 Trillion. If you include the rest of the world, it is $20 trillion.

 

Give them $25 Billion now with no strings attached.

 

In January give another $25 Billion to Ford and who ever is buying Chrysler. Give money to Toyota (Must be invested in US). Make the anouncement now, but let Obama give the details in January. Let GM go under in the spring.

[V8-X]

I believe the industry can indeed pour $25B down the 'hole', without anything backing up.

Agreed! Wagoner (GM) stated they are running thru roughly $5B dollars per month. So if they change nothing and GM got $10-$12B from the proposed $25B, they last a whopping 2-3 more months. Scary!

[RichardJensen]

Right now they dont have cash needed to deal with dealers and UAW is said they have already given enough.

 

And seeking a govt bailout with no strings is a noble way to run a business?

1) Right then, Ford didn't have cash. So they borrowed it. From private banks. With collateral. GM now needs to BORROW money from the federal gov't because there is NO money available from the private sector.

 

2) The UAW will almost always agree to buyouts. They will not agree to cutbacks in benefits when the wage/benefit gap has been substantially closed by the last contract.

 

3) Where on EARTH did I say a gov't bailout should come with NO STRINGS??????? Again, I take your assertion that you READ what I write here at face value. If you DO read it, it does NOT sink in.

[RichardJensen]

Great. But the fact remains..it wasn't enough.

 

I'd say begging in Washington for taxpayers to support a failing business is the coward's way out. Particularly when the business leaders don't even have the balls to include criticism of contributing government policies in the discussion.

1) It might be enough. Ford is the only company that went to DC and said, "Hey, we might not need this money."

 

2) It takes more courage to keep your mouth shut, sometimes, than it takes to shoot it off. What, exactly would Mulally have accomplished by turning the session into a shouting match? He still needs the votes of those tools to get any loan package approved.

[battyr]

Maybe the way to go is to forget bailing out the auto companies. Let the strongest survive.

 

A better idea is for the government to insure car loans. Increasing cars sales is the solution. With a government guaranty, the loans should be very cheap. If the loans are secured by the car so defaults should not cost too much. At the sametime give a tax break on new cars sales.