Times are tough! The US Big 3 are asking for the $25bn (I believe it is a loan) and it does somewhat stick in the craw. However, they could (and do) claim that a key issue is lack of loans for buyers. The banks in US and here have been bailed out by the governments so they can free up the cash market and keep the wheels of industry lubed. Instead they are hoarding the money as they don't want to risk losing it. Same here in Europe - in Italy 80% of applications for car loans are being turned down (i.e. people who want to buy).
So the crisis is not of the car industries making. Having said that the big 3 were in crisis anyway (which is partly of their own making) so they are not as well positioned to weather the storm. But again, it is lack of cash that may kill them, not whether they are profitable or not. JCI, one og the biggest global supplier in the industry are a profitable company but are nearly out of cash, and are thus in danger of bankruptcy. The lines of credit have dried up or are unaffordable. That's the reason why all the rumours of GM buying Chrysler abound - strategically it makes no sesne at all, but GM would get an $11bn line of credit. Crazy times.
In the meantime those big 3 CEO's got criticised on Captiol Hill when they turned up for the loan discussions in 3 private jets!!! What crisis? Our CEO is leaving with a $27m payout when we are losing another 1000 people globally, that is all wrong and I agree they need a wakeup call at the senior levels
BTW the 5 cars for every 4 people statistic is way wrong.
US car firms ask for $25bn aid
Moderator: Moderators
If I was in charge, I would have had those CEO dragged in by the scruff of the neck and had their bonuses ploughed back into their respective companies. That kind of money is plain, unadulterated money grabbing greed.
Very few people in modern industry are sufficiently talented or have a real need for a private jet, it's ostentatious and in today's world of global internet and video conferencing, an unnecessary drain on company resources.
Very few people in modern industry are sufficiently talented or have a real need for a private jet, it's ostentatious and in today's world of global internet and video conferencing, an unnecessary drain on company resources.
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Anonymous
As usual most of the US auto industry trouble can be traced back to the Unions.
The UAW is holding the US auto industry to ransom, they refuse to give any ground in talks with the big 3 management. The non-union track workers are getting $38/hr, so what do you think the union workers are getting??? They will precipitate their own demise since once all the car manufacturers have gone they will have no-one to boss around and make demands of.
They are asking for $25bn because for whatever reason they cannot get out of the over expenditure they have set themselves up for when times were good. The pension packages, the over paid & under worked work force, the large gold handshakes for management etc. And all this was taking place amid a shrinking market share.
Their business projections are based on them regaining this frankly unobtainable market share. The big 3 will never sell as many cars as they used to, they need to concentrate on making a profit on the market share they have rather than the one they used to have.
The UAW is holding the US auto industry to ransom, they refuse to give any ground in talks with the big 3 management. The non-union track workers are getting $38/hr, so what do you think the union workers are getting??? They will precipitate their own demise since once all the car manufacturers have gone they will have no-one to boss around and make demands of.
They are asking for $25bn because for whatever reason they cannot get out of the over expenditure they have set themselves up for when times were good. The pension packages, the over paid & under worked work force, the large gold handshakes for management etc. And all this was taking place amid a shrinking market share.
Their business projections are based on them regaining this frankly unobtainable market share. The big 3 will never sell as many cars as they used to, they need to concentrate on making a profit on the market share they have rather than the one they used to have.
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Dave-R
- Posts: 24752
- Joined: Sun Apr 18, 04 11:23 pm
- Location: Dave Robson lives in Geordieland
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Andy Neal sent me this news report.
Senate cancels vote on doomed auto bailout
Published - Nov 19 2008 06:17PM EST | AP
By JULIE HIRSCHFELD DAVIS - Associated Press Writer
The Senate's top Democrat has called off a planned vote this week on a $25 billion auto industry bailout. Senate Majority Leader Harry Reid said that he wanted to figure out some way to help Detroit's struggling Big Three but that efforts to do so had stalled.
The White House and congressional Republicans rejected Democrats' plan to dip into the $700 billion Wall Street rescue fund to finance loans to U.S. automakers.
A bipartisan group from auto industry states is working to cut a deal on a scaled-down aid package. If agreement can be reached, Reid said the Senate could still vote on it as part of a measure to extend jobless benefits.
Senate cancels vote on doomed auto bailout
Published - Nov 19 2008 06:17PM EST | AP
By JULIE HIRSCHFELD DAVIS - Associated Press Writer
The Senate's top Democrat has called off a planned vote this week on a $25 billion auto industry bailout. Senate Majority Leader Harry Reid said that he wanted to figure out some way to help Detroit's struggling Big Three but that efforts to do so had stalled.
The White House and congressional Republicans rejected Democrats' plan to dip into the $700 billion Wall Street rescue fund to finance loans to U.S. automakers.
A bipartisan group from auto industry states is working to cut a deal on a scaled-down aid package. If agreement can be reached, Reid said the Senate could still vote on it as part of a measure to extend jobless benefits.
I haven't heard from Andy for ages, last time he was in contact he didn't seem happy with the world and talking of pending litigation...I always looked forward at this time of the year to his shots of two foot of snow in the garden, always great to see together with movies of Ted having fun in the Dart!
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Dave-R
- Posts: 24752
- Joined: Sun Apr 18, 04 11:23 pm
- Location: Dave Robson lives in Geordieland
- Contact:
Andy is still around. I think he is hoping TrevD will turn up in the spring to give him a hand with the cars. 
Andy has a new client for his lights that James has met. http://dysonracing.com/
Andy has a new client for his lights that James has met. http://dysonracing.com/