Auto Execs Fly Corporate Jets to D.C., Tin Cups in Hand

[BetteDavisEyes]

Originally Posted by PM_Mama00

I think it was disgusting when the one CEO said he'd work for a $1 for the rest of the year, the one guy said (if I'm remembering somewhat correctly) that he'd take a pay cut, and the other guy says "No I'm comfortable with my 9.5 million" (not word for word). Ridiculous. I think the white collar workers need to take major pay cuts to save the blue collar workers jobs. Two years ago all 3 were doing major layoffs and my friend's sister, a white collar at Ford or GM, got a 20% raise.

I agree that it was freaking stupid for him to say what he did about his pay and to cut blue collar jobs while giving raises to white collar workers is beyond incredible.

[agzg]

Dee you're not alone in your fear. My worry is a little different from yours, however. I know there's a lake between us, but what goes on in my head is:

"Auto industry fails ----> layoffs ----> saturated job market ----> if I can't get lucky and find a job in my field, what are the chances of finding a job in a semi-skilled market to hold me over?"

Because this is how I think employers will be thinking:

"This girl is overqualified, and while we still could hire her, there's this guy over here and he got laid off from GM, he's driving four hours a day to get here, and he's got a family to feed. We're gonna hire the guy."

Not to mention all the other scary things about a possible bankruptcy that you mentioned.

Believe me, even people in Chicago are shaking in their boots about this, and we haven't even begun to feel the effects like you guys have.

[PeppyGPhiB]

Originally Posted by Kevlar281

No matter what happens I just hope GM does everything they can to keep the Chevy Volt project on track.

This is a perfect illustration of why GM is going under. The Chevy Volt, which I think is ugly and bulky and looks like a car only a man would drive, is scheduled to come out in 2011 and sell for more than $40,000. Meanwhile, Honda is gradually moving to an all-hybrid fleet, with its second generation of the Insight coming out in 2009 and retailing for LESS than the Civic Hybrid...in other words, it'll be one of Honda's cheapest cars (less than $20,000), and if it's like the previous Insight, it'll get more than 60 mpg. And it looks awesome!

GM lacks vision and is out of touch with what Americans want to buy. That is their problem, not the unions. The cheapest workers in the world won't help them if no one wants to buy their cars. And they just don't get it! They need a complete redesign of their line.

If you're the captain of the Titanic and you see the iceberg ahead, do you keep sailing straight for it, or do you try to do something different?!

[AGDee]

I love the Volt and would drive one in a heartbeat. If I never had to buy gas again, I'd be willing to pay in the mid 30's (the anticipated cost that I've read for it) to never buy gas again.

[PeppyGPhiB]

Originally Posted by AGDee

I love the Volt and would drive one in a heartbeat. If I never had to buy gas again, I'd be willing to pay in the mid 30's (the anticipated cost that I've read for it) to never buy gas again.

Well, different strokes for different folks I guess. But the battery is only supposed to last for 40 miles on a charge, so you would have to buy gas...that is, if you ever drive more than 40 miles when you're out and about, which I do practically daily. Right now it wouldn't work for me because I live in an apartment with no power outlet nearby to charge it. And it is supposed to retail for 40k, but they're trying to get it elligible for a tax credit that would bring it down to around 35k. But still, people could buy a cheaper BMW for that.

My point was that the Chevy Volt is ONE car - that won't be out for another 2-3 years - that GM is hanging its hat on. Why is it the only one, and why didn't they have the vision to come up with it years ago? Toyota and Honda have been working on their hybrids for about 15-20 years.

[AGDee]

GM has numerous hybrids on the market already and has for several years. It's not as though GM is hanging it's hat on the Volt. The Chevy Malibu hybrid was selling so fast they couldn't keep up with demand until the credit freeze hit. The Saturn Vue Hybrid is a hot seller also. They are hard to get. GM is also testing hydrogen fuel cell cars but there is nowhere for people to get the hydrogen fuel cells recharged, so that's an issue.

My commute to work is 44 miles so I'd have to use gas for maybe 10 miles a day with errands if I planned them right. That sure beats using gas for 54 miles a day. You'd be talking like a gallon or two a week! That would be so cool. The Honda electric car can currently only go 10 miles without a charge so the 40 miles is a big improvement.

[PeppyGPhiB]

Originally Posted by AGDee

GM has numerous hybrids on the market already and has for several years. It's not as though GM is hanging it's hat on the Volt. The Chevy Malibu hybrid was selling so fast they couldn't keep up with demand until the credit freeze hit. The Saturn Vue Hybrid is a hot seller also. They are hard to get. GM is also testing hydrogen fuel cell cars but there is nowhere for people to get the hydrogen fuel cells recharged, so that's an issue.

My commute to work is 44 miles so I'd have to use gas for maybe 10 miles a day with errands if I planned them right. That sure beats using gas for 54 miles a day. You'd be talking like a gallon or two a week! That would be so cool. The Honda electric car can currently only go 10 miles without a charge so the 40 miles is a big improvement.

Honestly, I didn't even know Honda had an electric car out.

[AGDee]

Originally Posted by PeppyGPhiB

Honestly, I didn't even know Honda had an electric car out.

It's not out, it's in development, like GMs.

And, it's possible it's the Hyundai... I get those "H" car companies confused.

ETA: Oops, it's a Toyota, the Mini-E as they're calling it now. A two seater.

[PeppyGPhiB]

Originally Posted by AGDee

It's not out, it's in development, like GMs.

And, it's possible it's the Hundai... I get those "H" car companies confused.

Electric, or hydrogen fuel cell? I don't see anything about an all-electric car from Honda...they've decided to go more in the way of fuel cell rather than electric, I think.

ETA: I also had no idea that Honda has a Natural Gas Civic out! http://automobiles.honda.com/civic-gx/

[KSig RC]

So let's work through this logically:

Originally Posted by AGDee

The auto companies were holding their own until the following things happened all at once:
1) Gas prices skyrocketed to over $4.00 causing people to stop buying the SUVs.

This is a simple supply failure - their inability to be flexible with their own supply line is actually a business decision, and a poor one at that. Japanese manufacturers have had to deal with this same issue, and had had no trouble re-tooling factory lines or accounting for sudden shifts in demand.

Additionally, gas prices have been on the rise for a long time, and are now below $1.50/gal - so what now? Is 6 months really that big of a deal? If so, again, that appears to be an endemic failure on their part.

Originally Posted by AGDee

2) The credit market froze. People who want to buy cars are having a hard time doing so because they can't get credit.

Seeing as the auto manufacturers themselves made the decisions that led to the current financing system (and its inbred nature with dealerships etc.) it's hard to be sympathetic, especially when this has affected dozens of other markets as well.

Originally Posted by AGDee

3) The stock market crashed. No business can survive their stock going from $24 a share in January to $3 in November.

This is an effect, not a cause - profitable companies still retained value. Companies built on archaic supply chain and manufacturing, with an upside-down pyramid structure, were appropriately priced by the market.

Originally Posted by AGDee

4) They cannot borrow money because of the credit crisis. The money they can borrow is at double digits %. Yet, the Federal Reserve rates have dropped to almost nothing for banks to borrow money from each other.

Again, effect, not a cause - this is akin to saying "I hit the ball directly at the center fielder, and he didn't drop it!"

I completely understand that this represents a damaging blow for Detroit and much of MI, and that the "everyday worker" is the one who will ultimately pay for the poor decisions of management - but it seems a bit far-fetched to pretend that this is simply a byproduct of circumstance. In reality, the auto manufacturers screwed up. It's really that simple - sure, Americans were buying SUVs, but Americans were also buying Priuses at record levels, too. The "Big 3" used internal strategy and marketing that was fundamentally flawed, allowing the confluence of circumstances to bring them down.

Now, should this earn a bailout? In the grand scheme of things, $25 billion isn't a ridiculous sum (irony alert) . . . but I, for one, would be loathe to have tax dollars go to allowing the same terrible management to run a private business using public money. It's similar to the airlines - two of the worst-managed industries since the Industrial Revolution, who are lucky to even exist today - and perhaps bankruptcy or nationalization would actually help. I simply would hate to abide the status quo using public money.

The UAW is complicit in this, by the way - while you can't fault a union for doing the best it can for its members, its rigidity really shows what an anachronism most unions have become in the modern economy. The $70/hr figure is ludicrous, considering the general skill level of the workers involved.

[Tinia2]

Some interesting comments in this story from Automotive News:
THE AUTO INDUSTRY BAILOUT:
Comments from experts, insiders, pundits and comics

Debate is rampant about whether some form of federal aid is headed to the Detroit 3. Late last week, Democrats crafted a set of requirements that General Motors, Ford Motor Co. and Chrysler LLC must submit with their loan applications. That topic and others triggered the latest rounds of editorials and commentaries from major international media.
Here are some snippets from the latest round of soundbites:
http://www.autonews.com/article/2008...811240276/1200


The Car of the Future -- but at What Cost?

Hybrid Vehicles Are Popular, but Making Them Profitable Is a Challenge
"That's because car manufacturers still haven't figured out how to produce hybrid and plug-in vehicles cheaply enough to make money on them. After a decade of relative success with its hybrid Prius, Toyota has sold about a million of the cars and is still widely believed by analysts to be losing money on each one sold. General Motors has touted plans for a plug-in hybrid vehicle called the Volt, but the costly battery will prevent it from turning a profit on the vehicle for several years, at least"
http://www.washingtonpost.com/wp-dyn...12403295&s_pos=

[madmax]

Originally Posted by preciousjeni

And since the original comment was aimed at me, I'm not anti-union. I'm anti-corruption.

Ignorant post. You started off complaining about high wages and now you are against corruption. Are high wages illegal?

[preciousjeni]

Originally Posted by madmax

Ignorant post. You started off complaining about high wages and now you are against corruption. Are high wages illegal?

I should have said "how much the union workers cost" which is the issue I'm getting at. However, they do make an incredible salary for their skill level.

[Kevlar281]

Originally Posted by PeppyGPhiB

This is a perfect illustration of why GM is going under. The Chevy Volt, which I think is ugly and bulky and looks like a car only a man would drive, is scheduled to come out in 2011 and sell for more than $40,000.

I'm sure certain aesthetics had to be sacrificed to make the Volt as energy efficient as possible. Yes $40,000 is a lot of money and for the record in will be out in 2010.

Originally Posted by PeppyGPhiB

Meanwhile, Honda is gradually moving to an all-hybrid fleet, with its second generation of the Insight coming out in 2009 and retailing for LESS than the Civic Hybrid...in other words, it'll be one of Honda's cheapest cars (less than $20,000), and if it's like the previous Insight, it'll get more than 60 mpg. And it looks awesome!

I'd take a GM over a Honda any day of the week and twice on Sunday. You do realize there are still parts of this country where buying American or at least buying something that is perceived as American means something right?

Originally Posted by PeppyGPhiB

GM lacks vision and is out of touch with what Americans want to buy. That is their problem, not the unions. The cheapest workers in the world won't help them if no one wants to buy their cars. And they just don't get it! They need a complete redesign of their line.

I'd say out of the big three GM is the only one who "gets it" and their foresight to produce an electric car shows that.

[Tinia2]

Originally Posted by Kevlar281

I'm sure certain aesthetics had to be sacrificed to make the Volt as energy efficient as possible. Yes $40,000 is a lot of money and for the record in will be out in 2010.



I'd take a GM over a Honda any day of the week and twice on Sunday. You do realize there are still parts of this country where buying American or at least buying something that is perceived as American means something right?


I'd say out of the big three GM is the only one who "gets it" and their foresight to produce an electric car shows that.

I agree with most of what you have posted. However, perhaps it is Ford that "got it" the most:
Ford Scion Looks Beyond Bailout to Green Agenda
http://www.nytimes.com/2008/11/24/bu...l?ref=business
http://www.ajc.com/biz/content/share...f9b4a189e.html
"“One of the things that I feel very encouraged about is the president-elect and where he’d like to take this country in terms of energy, and I completely buy into his vision,” Mr. Ford said in an interview, his first since the Big Three approached Washington lawmakers about a rescue plan.
He can afford to take a longer view because Ford, unlike G.M. and Chrysler, does not need an immediate infusion of government aid to stay in business."
"The company has enough cash on hand — $18.9 billion, as well as a $10.7 billion line of credit with private lenders — that will keep it running through 2009 without cutting development of its next generation of more fuel-efficient cars.
While Ford cannot continue to burn cash indefinitely, it is also not on the verge of bankruptcy like G.M. and Chrysler. And the health of the company presents a unique opportunity for Mr. Ford, 51, who has been chairman of the company since 1999 and served five years as its chief executive."
“One of the things we need to sort out as a country is batteries,” Mr. Ford said. “We really don’t want to trade one foreign dependency, oil, for another foreign dependency, batteries.” The main producers of batteries are Asian manufacturers."
"Mr. Ford has been Detroit’s most vocal environmentalist since becoming the first family member to run Ford since his uncle, Henry Ford II.
"Even when Ford was living off profits from its big sport utility vehicles, he was pushing to take the company in a greener direction. Ford was the first automaker to bring to market a hybrid version of an S.U.V., the Ford Escape, and it is introducing a new line of Ecoboost engines next year that will cut fuel consumption by up to 20 percent."...............

As for hybrids, there is a thread somewhere in GC about them.
If you were to compare the costs (fuel, operation, maintenance) of the same vehicle, gas vs hybrid, you would find out:
That the gas model cost less up front.
And the amount of gas savings with a hybrid would break even after (well) over 80,000 miles. And that was calculated when gas was over $3.50/gal.