White House to bailout Big 3.... - DFWstangs Forums
 
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post #1 of 20 (permalink) Old 12-13-2008, 06:09 AM Thread Starter
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White House to bailout Big 3....

Looks like Bush caved...

It isn't a done deal yet but they are basically going to get the money from the $700Billion financial bailout package. The rules state that Congress has to be informed and can block the transfer but there are not enough votes to block the plan..

http://www.azcentral.com/business/ar...Autos1212.html


Quote:
WASHINGTON — With Congress gridlocked and the economy floundering, the Bush administration declared Friday it would step in to prevent the “precipitous collapse” of the U.S. auto industry and the disastrous loss of hundreds of thousands of jobs sure to follow.

A day after the sudden demise of rescue legislation in Congress, General Motors officials were talking with the administration and the Federal Reserve about how carmakers could still get the billions of dollars they say they need to survive. The talks included conditions that automakers would have to meet, said GM spokesman Greg Martin.

The administration said no decisions had been made on the size or duration of the new bailout plan, or what type of concessions might be demanded from the struggling automakers, their workers, stockholders or others.

In a reversal, the most likely rescue option under consideration involved billions of dollars originally ticketed for the bailout of the financial industry. President George W. Bush had long declared that money off-limits to the beleaguered automakers.

General Motors Corp. and Chrysler LLC have warned they are running out of cash and face bankruptcy without some form of assistance. Ford Motor Co., which is in somewhat better shape financially, has been seeking access to a line of credit.

Urgent requests for White House intervention to save the automakers came from President-elect Barack Obama, Republican and Democratic members of Congress and outside groups.

“Under normal economic conditions we would prefer that markets determine the ultimate fate of private firms,” White House press secretary Dana Perino said after the failure of a $14 billion bailout bill in Congress. The legislation died when Senate Republicans demanded upfront pay and benefit concessions from the United Auto Workers that union officials rejected.

Perino added, “Given the current weakened state of the U.S. economy, we will consider other options if necessary including use of the TARP program to prevent a collapse of troubled automakers. A precipitous collapse of this industry would have a severe impact on our economy, and it would be irresponsible to further weaken and destabilize our economy at this time.”

TARP is the $700 billion Troubled Assets Recovery Program, the financial industry bailout plan enacted in October. All but $15 billion of the first $350 billion has been dedicated to troubled banks or insurance companies, and the Treasury Department is barred from dipping into the second $350 billion without a formal notification of Congress.

No decision has been reached about such a notification, administration officials said. If one is made, Congress could then vote to prevent the action, but it would be unlikely to prevail in a showdown with the president.

Obama, who will inherit the problem next month, even if bailout billions are handed over in the meantime, said, “My hope is that the administration and the Congress will still find a way to give the industry the temporary assistance it needs while demanding the long-term restructuring that is absolutely required.”

In a letter to Bush, House Speaker Nancy Pelosi urged the president to demand “the same tough accountability” and taxpayer protections from the automakers as was contained in legislation that cleared the House at midweek.

Michigan Rep. Thaddeus McCotter, a conservative Republican from a state where Ford, GM and Chrysler are headquartered, said, “With the legislative opportunities now exhausted, I urge the president of the United States to immediately release Wall Street TARP funds to the domestic automakers to avoid their impending bankruptcy and its consequent devastation of working families and the depression of our American economy.”

It was unclear what role was left to lawmakers after an extraordinary week in which prospects for industry relief seemed to change by the hour.

A week ago, the government reported the loss of 533,000 jobs in November, the worst monthly showing in more than 30 years.

In the days between then and now, the White House and congressional Democrats agreed on a $14 billion measure that would have extended short-term financing to the industry while establishing a powerful new “car czar” to make sure the money was used to turn the Big Three into competitive companies. That bill passed the House on Wednesday but immediately ran into opposition from Senate Republicans who said it did not go far enough.

On Thursday, they demanded the United Auto Workers union agree to accept a lower pay and benefits package that would be in line with compensation earned by workers at U.S. factories producing cars for Japanese companies such as Honda, Toyota and Nissan. In an unprecedented series of negotiations, lawmakers met with representatives of industry and labor on the first floor of the Capitol in hopes of striking a deal — the effort that ultimately collapsed when the UAW balked at the terms demanded.

At a news conference on Friday, UAW President Ron Gettelfinger accused GOP senators who blocked emergency loans of trying to “pierce the heart” of organized labor.

Sen. Bob Corker, R-Tenn., who played a leading role for Republicans, told reporters at the Capitol that the talks came close to success but failed when the UAW refused to commit to lowering its pay-and-benefits package in 2009 so it would be “at parity” with the Japanese companies.

He also laid blame at the feet of the administration. “I think it being known that the White House at the end of the day would probably blink probably helped keep us from a deal,” he said.

Whatever the reason, the effort stalled when Republicans voted en masse against advancing the original House bill to a final vote late Thursday night.

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post #2 of 20 (permalink) Old 12-13-2008, 06:12 AM
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The headline should be, "UAW Holds Country Hostage". It's all bullshit...us paying GM to keep screwing us on cars.

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post #3 of 20 (permalink) Old 12-13-2008, 06:24 AM
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Quote:
Originally Posted by Vertnut
The headline should be, "UAW Holds Country Hostage". It's all bullshit...us paying GM to keep screwing us on cars.
x2 on the GM thing, nothing but issues with the wifes Cobalt, I knew I should have bought a focus.
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post #4 of 20 (permalink) Old 12-13-2008, 06:44 AM Thread Starter
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Quote:
Originally Posted by red foxrod
x2 on the GM thing, nothing but issues with the wifes Cobalt, I knew I should have bought a focus.
Zero issues with my wife's HHR. Not even a rattle after 27K miles.

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post #5 of 20 (permalink) Old 12-13-2008, 07:35 AM
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Quote:
Originally Posted by Vertnut
The headline should be, "UAW Holds Country Hostage". It's all bullshit...us paying GM to keep screwing us on cars.
We're going to be paying for them one way or another, either thru a bailout or thru unemployment/pension plans.
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post #6 of 20 (permalink) Old 12-13-2008, 07:40 AM
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Quote:
Originally Posted by red foxrod
x2 on the GM thing, nothing but issues with the wifes Cobalt, I knew I should have bought a focus.
focus has problems too. im on my 2nd throttle body and it is beginning to stick just like the first one. And my power steering pump has begun to groan and make weird noises. All in 42k miles.
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post #7 of 20 (permalink) Old 12-13-2008, 08:18 AM
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Quote:
Originally Posted by mikeb
focus has problems too. im on my 2nd throttle body and it is beginning to stick just like the first one. And my power steering pump has begun to groan and make weird noises. All in 42k miles.

Shit my wife's focus has gone through 2 alternators 3 batterys and it sounds like shit while getting at best 20 MPG city. The damn car only has 38k on it, and its an 03.

Ill never buy another GM or Ford car again.
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post #8 of 20 (permalink) Old 12-13-2008, 09:01 AM
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I rather see them use money already on the table than print more to cover these morons .
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post #9 of 20 (permalink) Old 12-13-2008, 09:07 AM
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wow...that sucks.

Looks like the UAW won. The government should have held out until the UAW collapses or meets the demands to restructure and reduce benefits and wages.

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post #10 of 20 (permalink) Old 12-13-2008, 09:11 AM
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No big surprise

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post #11 of 20 (permalink) Old 12-13-2008, 09:32 AM
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Amazing. The UAW says "We won't take a pay cut, despite the fact the companies are sinking" and the white house along with Obama said "Yeah, don't worry about it UAW. I got your back." What in the hell happened to common sense?
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post #12 of 20 (permalink) Old 12-13-2008, 09:34 AM
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Quote:
Originally Posted by drift_poser
Shit my wife's focus has gone through 2 alternators 3 batterys and it sounds like shit while getting at best 20 MPG city. The damn car only has 38k on it, and its an 03.

Ill never buy another GM or Ford car again.
oh yeah I forgot about the OEM battery that only lasted 18 months
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post #13 of 20 (permalink) Old 12-13-2008, 09:39 AM
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Quote:
Originally Posted by drift_poser
Shit my wife's focus has gone through 2 alternators 3 batterys and it sounds like shit while getting at best 20 MPG city. The damn car only has 38k on it, and its an 03.

Ill never buy another GM or Ford car again.

What the hell do you expect out of a focus?? The msrp's on a focus from 2003 is $10k-$19k. A toyota camrys' msrp started at $19k. The comparable nissan is priced starting at $25k.

NO NO NO, it should be DFWLS1's, CUMMINS, C6 VETTES.net
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post #14 of 20 (permalink) Old 12-13-2008, 11:21 AM
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Quote:
Originally Posted by Vertnut
"UAW Holds Country Hostage"

This is true. Look if they do bail out the car companies, we are screwed. If they don't, we are screwed.

If they bail them out with the $15 billion we pay for that with our tax dollars. If they don't, guess what? All of them fuckers will claim unemployment and get on welfare. Guess who pays for welfare? That's right, you and me!!! With what? That's right, with our tax dollars.

This is what happens when government becomes too big. It all started with the mortgage shit a few years back. The gov't told the banks they had to loan the money to people trying to buy houses. People making less than $30,000/year were buying $250,000+ dollar homes. Guess what, they couldn't pay. Now the government thinks its big enough to pass this $700 billion bailout to pay for the mess they created. Here is the problem with what they have done. When you bail out one company, such as AIG or any of the banks, then other companies look for a handout too. My dad owns an insurance agency. Would the government bail him out if his business collapses? No. It is a dumbass concept made up by dumbass people. This is, well was, a free market economy. You were given the opportunity to succeed in this country by your OWN hard work. If you are too stupid to run a company the you are also entitiled to FAIL in your company. It is called responsibility, something this nation has long forgotten which has led up to what is going on today
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post #15 of 20 (permalink) Old 12-13-2008, 12:15 PM
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great now cwa is going to try and hold the strike for as long as they can when AT&T doesn't agree.

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post #16 of 20 (permalink) Old 12-13-2008, 12:22 PM
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Quote:
Originally Posted by 89gt-stanger
What the hell do you expect out of a focus?? The msrp's on a focus from 2003 is $10k-$19k. A toyota camrys' msrp started at $19k. The comparable nissan is priced starting at $25k.
He has a 2003, which is known to have issues. The earlier focuses had a lot of problems.

ford redid the focus in 2005, and fixed a ton of problems. They also got the 4 valve twin cam mazda engine, and got rid of the 2.0 ford engine.

frankly, i'm a little surprised/disappointed to start having issues with mine. Its been a pretty nice, inexpensive car so far, and its fun to drive.
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post #17 of 20 (permalink) Old 12-13-2008, 01:31 PM
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Quote:
Originally Posted by Blackedout01gt
This is true. Look if they do bail out the car companies, we are screwed. If they don't, we are screwed.

If they bail them out with the $15 billion we pay for that with our tax dollars. If they don't, guess what? All of them fuckers will claim unemployment and get on welfare. Guess who pays for welfare? That's right, you and me!!! With what? That's right, with our tax dollars.

This is what happens when government becomes too big. It all started with the mortgage shit a few years back. The gov't told the banks they had to loan the money to people trying to buy houses. People making less than $30,000/year were buying $250,000+ dollar homes. Guess what, they couldn't pay. Now the government thinks its big enough to pass this $700 billion bailout to pay for the mess they created. Here is the problem with what they have done. When you bail out one company, such as AIG or any of the banks, then other companies look for a handout too. My dad owns an insurance agency. Would the government bail him out if his business collapses? No. It is a dumbass concept made up by dumbass people. This is, well was, a free market economy. You were given the opportunity to succeed in this country by your OWN hard work. If you are too stupid to run a company the you are also entitiled to FAIL in your company. It is called responsibility, something this nation has long forgotten which has led up to what is going on today
This is the way I look at it....

IF the government held out on them and did not bail them out, yes, they would incur large pension debts that will ultimately cost the government more money. BUT, the large benefits will be the end of UAW contracts, restructuring a failing company with way less in labor costs that will ultimately allow the companies to survive. By holding out, the government will stick the retirees with 30-40% of their pension (which is what it should have been in the first place) and pay out the pensions over years to come and not lump summing a shit ton of cash into a company that will more than likely end up in the same darn place they are now...in just a few months. This bailout will be the same as AIG. Loan them $15 billion now and another $20 billion in 3 months because they are dead ass back in the same spot they are currently in. In my opinion, I do not see any light at the end of the tunnel for GM or Chrysler until they can cut their enormous wage costs and pension costs. Until they get the UAW off cloud 9 and back into reality of making what they should and forcing them to help contribute to their health benefits, the company will not budge from where it sits.

The true problems is the outrageous wages...until they get over this hurdle, they are beating a dead horse.

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post #18 of 20 (permalink) Old 12-13-2008, 04:11 PM
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Exactly. What I was listening to was back in 07, Toyota and GM sold the same amount of cars, problem is, Toyota made money while GM lost it. The UAW needs to wake up and realize their cash cow is hamburger
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post #19 of 20 (permalink) Old 12-13-2008, 06:07 PM
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this tells the story

http://mjperry.blogspot.com/2008/12/...same-cars.html

GM sales in 2007: 9,370,000 vehicles
Toyota sales in 2007: 9,366,418 vehicles

GM profit/loss in 2007: -$38,730,000,000 (-$4,055 per car)
Toyota profit in 2007: +$17,146,000,000 (+$1,874 per car)

or another
http://www.analyticalwealth.com/images/Toyota_GM.gif

Earnings Before Interest, Taxes, Depreciation and Amortization - EBITDA

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post #20 of 20 (permalink) Old 12-13-2008, 06:27 PM Thread Starter
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Quote:
Originally Posted by jyro
http://mjperry.blogspot.com/2008/12/...same-cars.html

GM sales in 2007: 9,370,000 vehicles
Toyota sales in 2007: 9,366,418 vehicles

GM profit/loss in 2007: -$38,730,000,000 (-$4,055 per car)
Toyota profit in 2007: +$17,146,000,000 (+$1,874 per car)

or another
http://www.analyticalwealth.com/images/Toyota_GM.gif

Earnings Before Interest, Taxes, Depreciation and Amortization - EBITDA
I know that labor and legacy cost are killing them to the tune of $2000 a car but have any of you looked at the rebates? You think $5000 off an Equinox might have something to do with it? There is $7000 off Hummer H3's and that is before the supplier discount for the red tag sale..

If GM can sell cars without these huge rebates, I don't think we have a problem here. Even their really good cars, like the Caddy CTS and Chevy Malibu have rebates. Discounts on large SUVs are in the 10000 range.

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