AMERICAblog: Chrysler exec predicts "depression" if we don't bail him out
Kiwi Jackson
· 11 months ago
Have they never heard the expression Choke Fail?
Choke this good country's people enough, it fails.
RitornaVincitor
· 11 months ago
Well, the Chrysler execs will certainly be depressed if we don't save them from their blunders.
naschkatzehussein
· 11 months ago
Am I incorrect? I thought Chrysler was a privately owned company with the likes of Dan Qualye and John Snow having interests in it. Who knows who else? It's one thing to help out ordinary citizens and workers, but I don't think the taxpayers should be bailing these millionaires out. Let them work it out with their own resources.
ExpatDan
· 11 months ago
Ya know, I love your blog. But you are soooo clueless here. Look at the fallout, and you'll see he's correct.
And ask yourself: why has no one asked Citi if they flew a private jet to DC. It is a total game...and the proles lose.
bumpkis
· 11 months ago
Threats worked for Paulson...its the new way of doing business.
nicho
· 11 months ago
It's been the "way of doing business" since Bush took office. Every decision made by Congress was made with a gun to their head -- do this, or else -- from the Patriot Act to the invasion of Iraq to the auto bailout.
Greensburg
· 11 months ago
Anything and everything no questions asked no oversight for wall street and the banking industries (everyone in DC including Obama rolled over for the finance sector) but when it comes to main street/blue collar workers and the spin offs there, our DC elite (including Obama) demand answers, solutions, accountability. Its business as usual in DC.
ZennButtKicker (tlhwraith)
· 11 months ago
However, there is a difference. The problem is that up until very recently Wall Street was the engine driving a large part of our economy. The paper pushers generated huge amounts of revenue that went to not only stuffing the fat-cats, but also keeping a lot of people in high paying jobs. The problem with the auto industry is that they've been faltering for decades, so, while I understand the bitterness and agree it is somewhat of a double-standard, in a way I can see why the difference of treatment exists. This aint the first time the auto industry has come with their hands out to the hill...
Kiwi Jackson
· 11 months ago
They'll hand at least some of it out , and soon. They have to.
But no need to for the little guys and girls who can't even make Christmas something for their kids.
stevetalbert
· 11 months ago
Crysler is making it sound bad because they are the least worth ''saving''. Their technology is jointly developed with Europe and Japan, so there is no real technological national interest and almost all of their production is in Canada, Mexico and other places.. Actually, similar to Lehman Bros, it would be good if they went bankrupt so to make the deals with GM and Ford more workable.
mike
· 11 months ago
Yes, and they don't have any public stockholders anymore, so that would make it easier. I don't trust the hedge fund behind them at all. I believe that they still refuse to open up all their books. Given that most hedge funds are really in trouble these days I'd really want to know what's going on with their finances before giving them money. I wish there was more discussion of that aspect of this. I really wonder if it's Chrysler that's in serious trouble, or the hedge fund itself.
I wonder how much the Dodge brand would be worth. That's a major global brand.
Greensburg
· 11 months ago
Um Zenbuttkicker, I kinda agree about the handouts, but the same can be said about the banking industry. Remember the S&L fiasco?
Nick_the_Dog
· 11 months ago
The American Auto Industry has been depressing for the last 40 years. What's new?
RevDrBillyBob
· 11 months ago
Gee ... maybe the government should just SEIZE all this guy's assets as a hedge against another depression, huh ? Sounds fair.
Forty2
· 11 months ago
$34 billion is a fraction of the money already pissed away by the boxcar-load bailing out the financial sorcerers who started this whole shitstorm and I wish Congress would stop being suck dicks about it. But yeah, preserving blue-collar and middle-class jobs doesn't matter; gotta save the big boys and their bonuses.
Fuck.
nova
· 11 months ago
And so what if the auto-guys get billions in bailouts? Their poor management decisions concerning quality control, design, product research and development have doomed their future existence. No amount of money will successfully bail them out.
The only thing that the current economic disaster has done is accelerate their demise.
MaudGonne
· 11 months ago
Speaking of bailouts.... Maybe bush and cheney could just resign....
http://www.telegraph.co.uk/finance/financetopic... Mortgage help plan brings interest payments relief for people facing repossession Home owners facing repossession will be able to defer part of their mortgage interest payments for up to two years, under plans unveiled by Gordon Brown. By Myra Butterworth, Personal Finance Correspondent Last Updated: 5:59PM GMT 03 Dec 2008
The new Homeowner Mortgage Support Scheme plan is designed to help borrowers who are at risk of being evicted from their homes because they are unable to keep up with their mortgage repayments. Eight major lenders, accounting for 70% of the market, have already agreed to be part of the scheme, including major players such as Halifax Bank of Scotland, Abbey and Nationwide.
Asterix
· 11 months ago
I heard an interview with the chairman of Saab, the Swedish auto maker owned by GM. They haven't turned a profit in 20 years and are looking for some support by the Swedish government. Asked if they knew the reasons for their abysmal performance, one of the primary reasons cited was that they built cars too well in the past--much of their old stock is still on the roads.
By simple inference, it would seem that any plan to return the company to profitability would involve manufacturing less-durable junk.
That made me wonder about our economic system that relies on product failure and obsolescence and inexhaustible resources for its survival. That producing and selling glitzy garbage is more profitable than producing carefully-made durable products.
Hell of a way to run a world--and one that eventually will have to change.
stevetalbert
· 11 months ago
A good recent book on that subject is 'Beyond Growth - Economics of Sustainable Development' by Herman Daly. It goes into this subject and what type of profit models can there be when constant growth in profit is not the goal and how is that measured. You don't need an economics background to read it. He gives good examples.
met00
· 11 months ago
simple solution.
The US government will but, right now, at MSRP every single car that you have that gets over 35MPG.
Then replace every car in the US Government fleet based on miles driven / mpg so that the ones with the greatest miles and worst MPG get replaced first.
1) the taxpayer gets something for their money 2) the car companies get cash influx 3) We replace cars that have the worst mpg and are the greatest pollutors from the federal fleet.
No handouts. Just a way to entice them to build what we will buy and want them to build.
lucky hussein
· 11 months ago
'shock doctrine'? do this or else? now now now!!
Bush_Bites
· 11 months ago
Actually, I'm liking this.
The companies and UAW have said they'll tighten their belts, they'll develop green technology and, best of all, the government will get an ownership stake in any company it helps.
First the banks, now the auto companies are almost begging to be semi-nationalized.
Jen
· 11 months ago
Just a clarification. The auto companies are not asking for "free" money. They are asking for a loan. Which means they will pay it back and there will be interest. This is way different than the banks who keep getting money for free from our government.
Fireblazes(CheetohsandCatfood)
· 11 months ago
Exactly, and ignorant people calling to "let them sink" have no idea of the devastating effects it will have on our economy. 2 to 5 million loss of direct jobs, 5 to 10 million in indirect jobs. Further pressure on the financial markets as those people default. Millions of small businesses put under because of all of the above. Oh yeah nobody's warranty will be worth the paper it is printed on. Not a threat more like a promise!
kh7463
· 11 months ago
Just the buyouts Ford did last year and earlier this year have been hurting my area already. A couple of dealerships have closed recently too.
Fireblazes(CheetohsandCatfood)
· 11 months ago
Go to your local dealerships, they have cars parked in overflow lots all over town.
Wisconsin Liberal
· 11 months ago
I used to work in a grey Iron foundry that made parts for GM and Ford and still live in that community. It will hurt them even more than they are hurting now. I have had cars from all three of the "Big Three", and yes years ago they were bad. But I have on 03 Impala and an 01 Town and Country and they have been reliable. They have come along way. Can't complain about those cars.
iamevolved
· 11 months ago
To hell with 'em. Let them sink. They built shit cars and now can wallow in their own shit pile.
beware of the leopard
· 11 months ago
Do you realise that you are an idiot? As others have said, millions would be adversely affected if the automakers were to experiance a contraction so severe that it threatened their survival. Possibly you as well. No company--to paraphrase--is an island.
iamevolved
· 11 months ago
Do you realize I dont give a crap what you think?
Indigo
· 11 months ago
But Chrysler is the very one I want to watch fumble and tumble. Will Jeep survive? It's a cliff-hanger! Jeep people are all about adventure, they'll love it! I'll make popcorn and we can throw unpopped corn kernels at the CEOs. It'll be fun.
anarchy
· 11 months ago
I wouldn't buy one of their crappy cars if it were only a nickel and you put a gun to my head.
KerrynowCampau
· 11 months ago
Considering the cost of repairs and maintenance for new cars I totally agree with you.
Give me an old Toyota or Datsun any day!
Soundboy_jeff_meanie
· 11 months ago
Datsun? now you're showing your age ;-)
KerrynowCampau
· 11 months ago
I would rather the money help the displaced workers once the auto companies fold (even if it is a loan).
US auto makers have had decades to get ready for what is happening now and if they couldn't see what was coming they deserve NO LOAN, NO NOTHING.
Fail because you did a crappy job. That is the American way.
bish8
· 11 months ago
I understand your thinking but what kind of job would the displaced workers get training for? We need good paying jobs for our economy to survive.
KerrynowCampau
· 11 months ago
All the "green" jobs that Obama talked about creating. Or how about jobs working to improve our infrastructure?
Sure it won't happen overnight, but neither will turning around the failed auto industry.
And they have failed. Spectacularly.
kh7463
· 11 months ago
Yea, and did you see about the Ford CEO saying he'll only be paid $1 a year if he uses any of the loan money? In the little sidebar it also noted they were taking away matching 401k funds, something else AND no more tuition reimbursement. That will hurt my place of employment dearly. Being so close to Ford's Chicago plant, we get a lot of their employees in our engineering and management programs.
Soundboy_jeff_meanie
· 11 months ago
my one question is, given that lobbyists aren't known for pro-bono work, how are they paying for this "feirce lobbying push"???
Hardy Haberman
· 11 months ago
We bailed out Chrysler once before and it did pretty well for a while, until they merged with Benz. I think they are right although perhaps a bit alarmist. Losing the auto industry will really hurt our economy and our employment.
vkobaya
· 11 months ago
You know how prejudiced the world is against blue collar people. Pickpocketing, shoplifting, burglary, robbery are considered major crimes and make all of us shudder. Consider the great train robbery where they stole ten million dollars. It was considered such a horrendous crime the perpetrators were given 20 sentences and they even made a movie about it.
But white collar people are treated completely different.y. Milken and Keating each destroyed businesses worth ten billion dollars, embezzling uncounted millions. One of them served 4 years and the other 18 months and got an apology. Ken Lay destroyed Enron and while he was prosecuted, it was only after delaying for years and years. Then he was allowed to scoot on the sentence, something about sympathy for his poor, poor, long suffering family who got to keep all the money he stole. Currently, the CEOs of the Wall Street banking and finance corporations aren't even prosecuted for crimes though they've each destroyed companies worth several times ten billion dollars. Each of them is now being awarded with tens of billions of dollars gifts with no strings attached. AIG has alaready burned through their first bailout and asks for another $30 billion. Citigroup was held up as an example of a company with a clean record and was given billions in financial assistance to buy out a rival company. Now we learn that Citigroup also has it's hands out for a $30 billion bailout.
The mistake the guys in the great train robbery made was that they were pikers. Instead of robbing a train of $10 million they should have held up Wall Street for say a hundred billion and they probably would have been acclaimed heroes, probably even elected to the White House as the president and cabinet.
sherifffruitfly
· 11 months ago
Ok you Chrysler piece of shit thief. I call your bluff, bitch.
katie g.
· 11 months ago
I read your blog a lot. But you are way off base on the auto industry situation. This is no different than the Wall St. debacle, in terms of potential fallout for the nation and the economy if these three companies fail.
It goes well beyond just the big three. The 2nd and 3rd tier suppliers who are the core of the metro-Detroit economy will fail. The number of retirees who will no longer have a pension or medical care to live on will only be a drain on state and federal resources when they do get sick and will have to be taken care of.
Not to mention, the fact that these automotive companies are suffering now primarily because of the credit-crisis caused in large part by Wall St.
Why don't you go take a drive around metro Detroit, and talk to the people in the small towns, and the restaurant owners, and store owners, and then through the factory towns in Ohio, and Indiana... before you spew this anger towards the industry. Its gotten a little pathetic and judgmental.
David Sands
· 11 months ago
all these bailouts are just a diferrent kind of trickle down economics. How did we ever believe that making rich people richer would help me? If it were true, the gap between the rich and middle class would have shrunk, which it didnt. Now we are being told to give the biggest companies billions of dollars and that it will help us. Prediction-- small businesses and entreprenuership will shrink and the big companies will thrive.
Double_D
· 11 months ago
You had your chance. You blew it. Now, fuck off and die. (How do you like capitalism now?)
Shootingstar
· 11 months ago
I have never purchased an American made car. Most likely never will. The main reason being that I prefer a car to be reliable and efficient. The last car that I purchased was in 2000, a Subaru. At the time I knew that gas prices had to increase again and that getting a car that would get better gas mileage and would run well past 250,000 miles was the best choice to make. My next vehicle will likely be some sort of hybrid, unless...
The American car industry takes a giant leap and is restructured to make something completely different. A few years ago I remember reading about a novel concept of personal transportation that combined a single family electric car with an electric train. The electric car would be used for short urban travel and for longer distances would link up with other electric cars to form a train. When joined together as a train the electric cars would be able to recharge and arrive at their long distance destinations fully charged.
I can't help but wonder what this system would be like with full automation. Imagine, you would log on to your computer (or smart phone) in the morning and request a car to be sent to your home (or you could have it automatically scheduled). The car would take you to work or further. Being fully automated traffic would be a breeze, no stoplights. Far less traffic if no one owned a car, just public vehicles that would be used by everyone.
I've considered why I (and many others) don't take the bus or some other public transportation. The reason is that we like our privacy and freedom that a car provides. An electric car/train system might be the way to persuade us Americans to adopt public transportation by giving us the best of both worlds.
Perhaps the problem is not just with Detroit. It might be with the way that we view transportation.
unpoetaloco
· 11 months ago
Chrysler is owned by an investment group. They've got money they could pump into the company. Don't give them a cent.
Mike_G
· 11 months ago
The problem is not just the cost structure -- if the Big 3 produced cars that were the equal of the Japanese brands in quality, durability, engineering, purchase satisfaction and driver appeal, but cost $1500 more (the cost-disadvantage figure they blame on retirement benefits they willingly negotiated with the UAW), they would sell plenty. Lots of Americans would pay that premium to support an American product that was truly the equal or superior of the import brand.
The best example of this situation was the 1986 Ford Taurus; Detroit had a family-sized car that matched the competition in driving dynamics and it became the best seller in the country. That is, until they pissed it all away with shoddy build quality, detonating transmissions and failing to invest in keeping the product updated and competitive to the point where they could only sell a trickle to rental fleets while the Camry and Accord ran away with the market.
But the Big 3 continue to produce corner-cutting, shoddy under-engineered products and sell them through sleazebag dealers offering crappy warranty support when things start to break. The last one is especially important though I don't see it reported much - I know lots of people who got the cold shoulder from Detroit makers on warranty repairs and vowed never to darken their doors again. If your product breaks more often than the competition, the very least you can do is be responsive to fixing things during the warranty period instead of trying to save pennies by burning your customers.
Detroit seems to foster a management culture of stupid greedy assholery, and I don't think you'll ever improve their provincial head-in-the-sand mindset without firing 90% of the upper and middle management who focus on financial games and hucksterish marketing of crap, and replacing them with people who actually want to engineer good cars. Honda is successful because their management is dominated by engineers who insist upon their products having integrity and quality. In Detriot there's too much temptation for financial guys who don't give a shit about the product to produce cheap crap and advertise it relentlessly to rope in the suckers, make the fast short-term buck and get their bonus before the long-term deterioration in product reputation comes home to roost. You can't viably run an industrial manufacturing operation with long product cycles when all you focus on is pumping up this quarter's financials - but those are the guys who get promoted and perpetuate the same ignorant short-sighted culture.
All Comments
Choke this good country's people enough, it fails.
And ask yourself: why has no one asked Citi if they flew a private jet to DC. It is a total game...and the proles lose.
But no need to for the little guys and girls who can't even make Christmas something for their kids.
I wonder how much the Dodge brand would be worth. That's a major global brand.
Fuck.
The only thing that the current economic disaster has done is accelerate their demise.
http://www.telegraph.co.uk/finance/financetopic...
Mortgage help plan brings interest payments relief for people facing repossession
Home owners facing repossession will be able to defer part of their mortgage interest payments for up to two years, under plans unveiled by Gordon Brown.
By Myra Butterworth, Personal Finance Correspondent
Last Updated: 5:59PM GMT 03 Dec 2008
The new Homeowner Mortgage Support Scheme plan is designed to help borrowers who are at risk of being evicted from their homes because they are unable to keep up with their mortgage repayments. Eight major lenders, accounting for 70% of the market, have already agreed to be part of the scheme, including major players such as Halifax Bank of Scotland, Abbey and Nationwide.
By simple inference, it would seem that any plan to return the company to profitability would involve manufacturing less-durable junk.
That made me wonder about our economic system that relies on product failure and obsolescence and inexhaustible resources for its survival. That producing and selling glitzy garbage is more profitable than producing carefully-made durable products.
Hell of a way to run a world--and one that eventually will have to change.
The US government will but, right now, at MSRP every single car that you have that gets over 35MPG.
Then replace every car in the US Government fleet based on miles driven / mpg so that the ones with the greatest miles and worst MPG get replaced first.
1) the taxpayer gets something for their money
2) the car companies get cash influx
3) We replace cars that have the worst mpg and are the greatest pollutors from the federal fleet.
No handouts. Just a way to entice them to build what we will buy and want them to build.
The companies and UAW have said they'll tighten their belts, they'll develop green technology and, best of all, the government will get an ownership stake in any company it helps.
First the banks, now the auto companies are almost begging to be semi-nationalized.
Not a threat more like a promise!
over town.
only a nickel and you put a gun to my head.
Give me an old Toyota or Datsun any day!
US auto makers have had decades to get ready for what is happening now and if they couldn't see what was coming they deserve NO LOAN, NO NOTHING.
Fail because you did a crappy job. That is the American way.
Sure it won't happen overnight, but neither will turning around the failed auto industry.
And they have failed. Spectacularly.
But white collar people are treated completely different.y. Milken and Keating each destroyed businesses worth ten billion dollars, embezzling uncounted millions. One of them served 4 years and the other 18 months and got an apology. Ken Lay destroyed Enron and while he was prosecuted, it was only after delaying for years and years. Then he was allowed to scoot on the sentence, something about sympathy for his poor, poor, long suffering family who got to keep all the money he stole. Currently, the CEOs of the Wall Street banking and finance corporations aren't even prosecuted for crimes though they've each destroyed companies worth several times ten billion dollars. Each of them is now being awarded with tens of billions of dollars gifts with no strings attached. AIG has alaready burned through their first bailout and asks for another $30 billion. Citigroup was held up as an example of a company with a clean record and was given billions in financial assistance to buy out a rival company. Now we learn that Citigroup also has it's hands out for a $30 billion bailout.
The mistake the guys in the great train robbery made was that they were pikers. Instead of robbing a train of $10 million they should have held up Wall Street for say a hundred billion and they probably would have been acclaimed heroes, probably even elected to the White House as the president and cabinet.
It goes well beyond just the big three. The 2nd and 3rd tier suppliers who are the core of the metro-Detroit economy will fail. The number of retirees who will no longer have a pension or medical care to live on will only be a drain on state and federal resources when they do get sick and will have to be taken care of.
Not to mention, the fact that these automotive companies are suffering now primarily because of the credit-crisis caused in large part by Wall St.
Why don't you go take a drive around metro Detroit, and talk to the people in the small towns, and the restaurant owners, and store owners, and then through the factory towns in Ohio, and Indiana... before you spew this anger towards the industry. Its gotten a little pathetic and judgmental.
(How do you like capitalism now?)
The American car industry takes a giant leap and is restructured to make something completely different. A few years ago I remember reading about a novel concept of personal transportation that combined a single family electric car with an electric train. The electric car would be used for short urban travel and for longer distances would link up with other electric cars to form a train. When joined together as a train the electric cars would be able to recharge and arrive at their long distance destinations fully charged.
I can't help but wonder what this system would be like with full automation. Imagine, you would log on to your computer (or smart phone) in the morning and request a car to be sent to your home (or you could have it automatically scheduled). The car would take you to work or further. Being fully automated traffic would be a breeze, no stoplights. Far less traffic if no one owned a car, just public vehicles that would be used by everyone.
I've considered why I (and many others) don't take the bus or some other public transportation. The reason is that we like our privacy and freedom that a car provides. An electric car/train system might be the way to persuade us Americans to adopt public transportation by giving us the best of both worlds.
If you are interested, here's a website that provides more information about this idea.
http://electriccartrain.com/QandA.html
Perhaps the problem is not just with Detroit. It might be with the way that we view transportation.
The best example of this situation was the 1986 Ford Taurus; Detroit had a family-sized car that matched the competition in driving dynamics and it became the best seller in the country. That is, until they pissed it all away with shoddy build quality, detonating transmissions and failing to invest in keeping the product updated and competitive to the point where they could only sell a trickle to rental fleets while the Camry and Accord ran away with the market.
But the Big 3 continue to produce corner-cutting, shoddy under-engineered products and sell them through sleazebag dealers offering crappy warranty support when things start to break. The last one is especially important though I don't see it reported much - I know lots of people who got the cold shoulder from Detroit makers on warranty repairs and vowed never to darken their doors again. If your product breaks more often than the competition, the very least you can do is be responsive to fixing things during the warranty period instead of trying to save pennies by burning your customers.
Detroit seems to foster a management culture of stupid greedy assholery, and I don't think you'll ever improve their provincial head-in-the-sand mindset without firing 90% of the upper and middle management who focus on financial games and hucksterish marketing of crap, and replacing them with people who actually want to engineer good cars. Honda is successful because their management is dominated by engineers who insist upon their products having integrity and quality. In Detriot there's too much temptation for financial guys who don't give a shit about the product to produce cheap crap and advertise it relentlessly to rope in the suckers, make the fast short-term buck and get their bonus before the long-term deterioration in product reputation comes home to roost. You can't viably run an industrial manufacturing operation with long product cycles when all you focus on is pumping up this quarter's financials - but those are the guys who get promoted and perpetuate the same ignorant short-sighted culture.