Comments on: Don’t junk the U.S. auto industry http://blogs.reuters.com/great-debate/2008/11/19/dont-junk-the-us-auto-industry/ Thu, 21 Jul 2016 07:57:19 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: Brian Leonard http://blogs.reuters.com/great-debate/2008/11/19/dont-junk-the-us-auto-industry/#comment-2287 Tue, 02 Dec 2008 20:15:29 +0000 http://blogs.reuters.com/great-debate/?p=586#comment-2287 As the controller of a closely-held business enterprise I can partially agree with “bankruptcy is not the end” but it will cause significant “collateral” damage through additional bankruptcies throughout the automotive supply chain.

A significant portion of our business base was/in within the steelmaking industry,(another industry known for the same faults that the american automotive industry is guilty of.) While steelmaking continued to run “business as usual” they kept continued, extended pressure on the supplier base for lower and lower pricing and extended payment terms(90 – 120 days). Within a short 1 – 2 year period we experienced roughly $750,000 in lost revenues in addition to losses in ongoing business due to closed capacities.

The winners in the whole bankruptcy scenario?, the accountants and attorneys for the bankrupt companies(thanks to their having first priority to available funds) and the officers and interim officers of the bankrupt companies. Years later the venders(those who survived)received less than 1/4 of 1 percent of what was due to them.

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By: Danny Kirkpatrick http://blogs.reuters.com/great-debate/2008/11/19/dont-junk-the-us-auto-industry/#comment-2184 Mon, 01 Dec 2008 13:05:22 +0000 http://blogs.reuters.com/great-debate/?p=586#comment-2184 The Big 3 are not looking for a bail out! Only a loan from the Federal Government. If you look at the amount of Federal monies that all the employee,s at the Big 3 pay into the federal taxes you will total this in the billions.This would basically be a loan from the people-to-the-people of the Big 3 automakers!!!!! I beleive the Big 3 automakers should shutdown all their plants for 6 months and let the american people feel what the impact financially to this country would be. Also after 911 all three companies dontated 10 million dollars each along with product to New York City.

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By: Mike Archer http://blogs.reuters.com/great-debate/2008/11/19/dont-junk-the-us-auto-industry/#comment-2166 Mon, 01 Dec 2008 01:53:54 +0000 http://blogs.reuters.com/great-debate/?p=586#comment-2166 All this hooplah about CEOs and private jets is just a red herring. John said it all in his comment, just read that; perfectly said. As for bankruptcy working as a viable option for the airlines (Eric’s comment), there is one key difference–the average American isn’t buying an airplane. But we do buy cars. Would you feel comfortable buying a car from a bankrupt carmaker? How about getting it serviced and getting parts with the prospect that the manufacturer could disappear shortly? Bankruptcy is not a workable solution. We need to lend a helping hand to the Big 3.

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By: siburp http://blogs.reuters.com/great-debate/2008/11/19/dont-junk-the-us-auto-industry/#comment-1823 Tue, 25 Nov 2008 13:18:52 +0000 http://blogs.reuters.com/great-debate/?p=586#comment-1823 Any company which produce products which do not sell is allowed to go bankrupt, why the big 3 be given an exception? Jobs lost as excuses….etc? What have happened to free market concept and belief?

Unless the BIG 3 with its super rich CEOs know that their companies can go bankrupt and they can go unemployed( hopefully no golden handshakes have been arranged in their contracts other the incentive to fail has already been embedded), flying in their private jets to beg for bailouts, only then they may be able to find a better way to compete with other car makers and keep their jobs as well.

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By: John http://blogs.reuters.com/great-debate/2008/11/19/dont-junk-the-us-auto-industry/#comment-1813 Tue, 25 Nov 2008 03:12:22 +0000 http://blogs.reuters.com/great-debate/?p=586#comment-1813 It is incredible that we even have this debate flooded with irresponsible, lynch-mob mentality against one of our key industries. Obviously, bankruptcy is not a solution for any automotive company, especially in the present economy. Would you buy a car from a bankrupt company or do you know of anyone who’s done it lately? Mr. Ludwig presented an excellent rational case in support of a bridge loan for our domestic auto industry, which, if one judges by the only existing precedent – Chrysler’s “bailout” 30 years ago – at the end may very well turn out to be a good investment for us the taxpayers. The prospects for Chrysler survival back then seemed at least as bleak as for the Big 3 now (note that Ford had profits earlier this year until wild swings in gasoline prices and subsequent credit crisis hit it hard). At the end Chrysler paid the loan seven years before the deadline with $300M profit for taxpayers on a loan of $1.5B, which would be roughly equivalent to $7-10B in todays dollars.

It is interesting that the Big 3 have been profitable almost everywhere else but in the States. One of the main reasons is that in Europe and elsewhere there are stable national energy policies that facilitate good planning. For example, they have stable gasoline prices around $6-8 with the help of taxes used for infrastructure and similar. As it became brutally clear now at the end of these disastrous eight years of George W. Bush administration, we have no energy policy or industrial policy for that matter. This is a great opportunity for President-elect to develop one. It should include stabilizing gasoline at $3-4 with implied taxes to be used for improving our infrastructure and promoting green transportation. Then watch the Big 3 returning the loans well before time, with ample profits for taxpayers and with some great new green technologies in their again profitable vehicles.

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By: CtheLight http://blogs.reuters.com/great-debate/2008/11/19/dont-junk-the-us-auto-industry/#comment-1806 Mon, 24 Nov 2008 22:11:13 +0000 http://blogs.reuters.com/great-debate/?p=586#comment-1806 The big 3 make smaller vehicles – and they sit on the dealer lots because Americans are buying SUV’s. Even the so called enviromentalists in CA government are driving SUV’s (check out thier fleet vehicles on the city websites!) -> not the small, environmentally friendly, green cars that they are trying to force the big 3 to make. In capitalism, manufacturing builds what is selling – not what folks are preaching. It is not only the managment that is at fault – but every American that bought a large vehicle instead of a small one….

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By: James Short http://blogs.reuters.com/great-debate/2008/11/19/dont-junk-the-us-auto-industry/#comment-1797 Mon, 24 Nov 2008 18:31:40 +0000 http://blogs.reuters.com/great-debate/?p=586#comment-1797 The problem is firstly sales. The government is no good at sales (or manufacturing or finance…). GM wasn’t ready for the double whammy of a gas price escalation and a credit crisis. Now the gas prices have moderated but the credit crisis has not. The credit crisis should be fixed, by bailout and regulation/oversight.

As for the manufacturers, they should make and sell cars until they go broke. The government can pick up the pieces more cheaply then, and soon thereafter we’ll be back to normal with no hangover.

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By: Kombo http://blogs.reuters.com/great-debate/2008/11/19/dont-junk-the-us-auto-industry/#comment-1764 Sun, 23 Nov 2008 17:54:58 +0000 http://blogs.reuters.com/great-debate/?p=586#comment-1764 they’re already dead. any attempt to undo decades of misteps in a matter of months is wishful thinking. $25B won’t save them. only WW3 can save these dinosaurs

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By: Brad http://blogs.reuters.com/great-debate/2008/11/19/dont-junk-the-us-auto-industry/#comment-1732 Sat, 22 Nov 2008 23:51:32 +0000 http://blogs.reuters.com/great-debate/?p=586#comment-1732 Lets face it America,
Your so-called Auto industry is in its final death throws. Foreign companies have been whipping your butt for years, and you’ve ignored it. This industry has no hope for you, it’s over unless you lead the way with the plug-in electric car. A subsidised economy is no more than a magic trick, and we all know they’re not real. Just look at your Agriculture industry, it’s just another form of welfare. Now because of your in-ept government led by a fool who couldn’t even put together 2 words, your Auto ‘Welfare’ Industry is just about to start doling out the welfare cheques as well. ‘Henry Ford’ would be turning in his grave. Surely you people are smarter than this.
If you choose to prop up industry the inevitable outcome is they eventually fail. Unfortuanately welfare doesn’t fix the problems only new ideas do.
If you all keeping living in this fantasy land you will have nothing left. As far as I can see the only industry you have that makes any real money is war, and soon you won’t even own that.
You see you can only make money 2 ways. 1/ You Plunder, 2/ You create. Unfortuantely the plundering is over for you, it’s now time to create.

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By: Jinjae http://blogs.reuters.com/great-debate/2008/11/19/dont-junk-the-us-auto-industry/#comment-1724 Sat, 22 Nov 2008 18:37:42 +0000 http://blogs.reuters.com/great-debate/?p=586#comment-1724 Yes, the impact will be massive. But this $25bn isn’t going to change these car-makers into profitable companies; it’s only going to delay their bankruptcy for 6 months or 1 year by paying a price of $25bn which will be burnt away by these auto-makers? What good is this going to do to America? It is like just pouring water into a vase with a hole, hoping that it will be filled up; it won’t – let them go bust and we should be able to clean it up although it seems impossible.

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