UH2L

Does the Auto Industry Deserve To Be Bailed Out?

Bababooie,

For you to bring up the fact that the writer is not an American born citizen has no place in our comment. I am not one either. I was born in India, (presumably where Nirav is from based on his name), but I grew up in the Midwest from when I was a baby. I'm also a liberal and I have an MBA from the University of Michigan.

Don't go stereotyping people based on ethnicity and education.

Auto MPG: The Economics of CAFE, Part One

CAFE doesn't restrict what kind of car you can drive. It restricts the average fuel economy of vehicles sold by a given manufacturer. And even then manufacturers can sell all guzzlers as long as they pay the fines. Mercedes has been paying fines for years but you can still buy a souped up AMG Mercedes getting 12 mpg.

And as for fuel tax increases being the way to go, that's like asking kids who are addicted to sugar if they want less sugar and they can vote to have parents that will give them as much sugar as they want or parents who will restrict how much sugar they can have. We are like such children in this regard. We want cheap gas and are outraged when the price goes too high. We feel that cheap gas is our God-given right and would never collectively vote in politicians that would raise gas taxes significantly, even if it was done gradually. There's also the part about such tax increases slowing down our economy and making transportation unaffordable for poor people.

CAFE is a decent solution but far from ideal. I think tax rebates on a sliding scale for cars more efficient than the standard are the way to go. These could be offset by sliding scale tax penalties on cars that get below the average.

Cars: What It Means to 'Buy American'

It's amazing how us Americans can be so Anti-American, and more specifically anti-Detroit. There's this grudge from prior bad product experiences and jealousy for people working on assembly lines making more money than people with degrees. I have two degrees and I admire these workers because I don't know how they do it day in and day out. Also, it's not just workers screwing parts together. There are many skilled trades that require lots of training and experience including tool maintenance, model-making, test-driving.

I applaud Obama's stance. He realizes how important our auto manufacturing industry is economically, technologically, and for energy independence / national security.

People tend to forget that it's not just about where the vehicle is built, but where the work behind the design, engineering, marketing, finance, accounting, takes place too.

I think the unions did ask for too much up until recently, but if it weren't for unions, none of us would enjoy the benefits and protections we have today.

I was in Germany recently and I would say 80% of the cars I saw were German. If only we had that kind of patriotism here.

What else is made here anymore? We need manufacturing here for a strong economy. That's because we need to bring money into our economy by selling goods to other countries. We cannot survive as a service-based economy. You can't export haircuts and carwashes!

Does the Auto Industry Deserve To Be Bailed Out?

It's not a matter of whether the companies deserve the loans, (notice I didn't use the term bail-out). God knows, the banks didn't deserve them due to their greed and stupidity. But, giving them the money was the best thing to do for the good of the world economy. I would argue that the same holds true for these Detroit 3 bridge loans.

Auto workers are not unskilled!!! Do you even know what the workers do besides screwing in bolts? Have you ever been to an assembly line, design studio, stamping plant, test track? They do modelmaking, tool maintenance, durability driving, data acquisition, computerized machining. What you call a "worker" is not just a person on the assembly line. And to say a monkey can do their job is insulting. Even with simpler jobs, what the lineworkers do is admirable considering the monotony, physical exertion, and risk of injury in certain cases. Desk jobs don't kill people but plant jobs can and do occasionally.

Perhaps they do make too much, but it's a legacy from prior UAW contracts that aren't the fault of current management. They are doing the right thing by fulfilling obligations and if they go bankrupt, (which will mean disaster for sales and our economy), then they will get out of the obligations but the healthcare and pension burden will be shifted onto the government. And nobody will buy a car at a reasonable price from a bankrupt company for fear of not getting parts and service.

By the way, I'm a white collar former GM employee, but these arguments by supposed "experts" have to stop. Learn what really goes on in the industry before you write such articles. You are doing a disservice to our workers, our auto industry, and our economy.

UH2L
www.thingsivenoticed.c...

William Holstein on Why GM Matters

We need a manufacturing base in our country because it leads to exports that bring money into our economy. I always say, "You can't export haircuts and carwashes." Manufacturing-based jobs also are better in pay and benefits than service-based ones. The only major products made in this country anymore are cars and trucks. Other industries are so intertwined as well. So we have to assure that the industry stays alive.

www.thingsivenoticed.c...

Automakers: Bailout Arguments, Pro and Con

A car company can't survive while bankrupt! Very few people will buy a car from a bankrupt company when they can't be sure that parts and service will be available for 4+ years. It's way different than an airline ticket which is consumed and done within a few months if not days.

UH2L
www.thingsivenoticed.c...

Ford: Strongest of the Three and Rightfully So

The writer is forgetting some key things. It's not about principles. How often do corporations have those? Corporations are meant to make profits and they'll do whatever they have to do to get money to stay afloat. The fact of the matter is that Ford has access to family money and the company secured financing before the financial crisis that our banks caused. If this was a normal banking world, GM may not have needed loans from the government. It's not a bailout!!! Is your mortgage a house bailout?

I do admire some of Ford's recent product moves and their quality improvements so some of the credit should go there, but we'll see how their small cars from Europe sell if gas prices stay low. On the whole, Americans don't really care about fuel economy or the environment. They care about their wallets first and foremost. (And they like vehicles that are larger and more powerful).

Detroit's Big Three and the Democrats' Economic Illiteracy

I got tired of retyping my thoughts on the government loans for the Detroit 3, so I summarized everything here...

uh2l.blogs.com/things_...

This guy has some decent points but, it's not about who's to blame; it's about what should we do now for the good of the country.

UH2L

Should We Really Bail Out the Big Three Automakers with $73.20 Per Hour Labor?

Building a car is not just screwing on bolts. There are people who do skilled trades that few of us with masters degrees could do. Modelmaking, prototype building, machining with computer controlled machinery, etc... And the monotony of some of their work deserves compensation too. If it weren't for the unions, we wouldn't have nearly the benefits that we do in the white collar world.

Perhaps unions began to expect too much, but I would much rather these people make more money than the executives make millions more. They can lay people off to help the bottom line but who's going to buy your products if nobody has a well-paying job to be able to afford them? Will that help business in the long term?

As for people who say the Domestic Three make cars nobody wants, you should go drive some and check out the latest quality surveys and then talk. It's really sad that we're not at all patriotic when it comes to one of the last manufactured products developed and/or made in our country. I think we should reward companies that treat their employees well by buying their products. Instead we reward ones that overwork their employees to the point of them committing suicide. To wish for the Domestic Three's downfall is sheer stupidity as the related job losses in other industries would be devastating. Healthcare, advertising, legal services, construction, banking all will be affected. Your job may be affected even if you don't live in Michigan!

Not to dismiss some of the management mistakes these companies have made, but the playing field hasn't been level for a long time and the Bush/Republican administration did nothing about healthcare, currency manipulation, unfair trade practices. A domestic auto industry owned by American corporations is important to our national security too. Toyota and VW plants in the US won't be volunteering to make tanks and defense parts if we ever enter into a real global war.

Detroit is Hemorrhaging

I read a report about the hundreds of thousands of jobs that are tied to the auto industry, not just in Michigan and not just in the automotive industry. For the US to let its auto industry disappear would be foolish for many reasons. What other major industrial consumer product is made in the U.S. anymore besides cars? Just about nothing. It would probably cost the government a lot more to take care of the unemployed than to bolster the Detroit 3 and maintain employment for people and get the resulting tax revenues. Manufacturing is very important to national security, keeping the trade imbalance under control and to promote other technologies such as alternative energy. The government needs to level the playing field for the Detroit 3 by making up for the healthcare, pension costs that competitors from other countries aren't burdened by. It also needs to work for trade fairness with Japan and to fight currency manipulation.

It just angers me when people say that Detroit doesn't make products people want to buy. Being number two and number three in sales doesn't mean nobody wants your products. I would buy a GM product over a Toyota or a Honda any day. Many of GM's products are amongst the most efficient in their segments. I don't understand why we are so unpatriotic as a nation when it comes to buying things made in our country or at least engineered and developed by companies based here. The press is also to blame as they highlight negatives about Detroit way more than they do about the Japanese. They even criticize the Volt without fully understanding how it works or who the target market is.

UH2L
www.thingsivenoticed.c...

The Shallowest Generation

Thank you thank you thank you for this article that puts data behind what I have said all along. Gen X and Gen Y are not the selfish generations we are made out to be. I wrote about it here a while ago...

uh2l.blogs.com/things_...

As for your quote...
"No one in Washington has shown an ounce of leadership in decades. True leadership requires strength of character, clear vision to see the future as it is, the bravery to make unpopular decisions, and the honesty to tell the public the unvarnished truth based on the facts."

Nobody will get voted in to office by saying unpopular things! That is the problem with a democracy/republic. Any mention of raising taxes or sacrifice will lead to an assurance that the other candidate will win.

UH2L

Honda Ranked Most Fuel-Efficient in U.S.

I agree with the other commenters. These stats for manufacturer fleet fuel efficiency numbers are useless. People don't buy a fleet of cars, they buy one of a certain segment.

You should note that the Ford Fusion gets the best (non-hybrid) fuel economy for a mid-sized sedan, the Chevy Equinox gets the best fuel economy for a mid-sized SUV, the GM full size trucks are best. These are the stats that matter and they correspond with the segments that sell the most so they have the most impact. At the other end of the spectrum, the Camaro and Corvette get amazing highway fuel economy, kicking the butt of their segment competitors. GM, Ford, Chrysler are a little low on the small car segments except for the Chevy Cobalt XFE. But, the press likes to bash Detroit and portray things in a way that makes them look bad. Just wait for the Chevy Cruze and the Ford Fiesta to kick some more fuel efficiency butt.

General Motors, Chrysler: Cutting Their Way to Greatness

If the Detroit 3 can't cut their way to greatness then what would you have said if they didn't make major cuts, perhaps that they're bloated an inefficient.

The line "making cars people want to buy" is so overused and misleading, it's getting highly frustrating. Do you know who has recently sold the most mid-sized cars? GM, but just because the volume was spread out over many models, the press jumped all over it as GM doesn't sell cars people want. Sure, there were a lot of fleet sales a few years back, but that has been significantly cut back. GM also has many loyal buyers and so do Ford and Chrysler. Read the most recent quality stats and you'll see that the domestics often outperform imports. So, it's not as if the products are so bad.

I think automotive press writers need to start writing articles that are more fair so that people aren't convinced away from buying from companies based in OUR country.

Saab May Be GM's Best Hope for the Future

I am a long-time Saab fan, but unfortunately, most people never caught on to how far ahead of the curve Saabs have been. People didn't want, (and still don't) want a FWD 4 cylinder turbo entry luxury car that gets 30 mpg with 60-70 cubic ft of cargo volume, (my 9-3 wagon has more cargo volume than a Ford Edge and a Mazda CX-7. I also average 28+ mpg with half city miles. Saabs have always been the true AntiSUV. They are light, safe, efficient, and sharp looking. It's always funny how people criticized them before for being quirky. That was supposedly why they never sold in higher volumes, then when GM tried to make them more mainstream, then many of those same people criticized them for being too generic.

As for the whole GM and Detroit 3 loan issue, I summarized all my thoughts on an article I wrote on my blog here...

uh2l.blogs.com/things_...

Tough Love for Detroit Is Long Overdue

Where is the tough love for the financial bankers who are responsible for this crisis and partially responsible for the decline of the Detroit 3?

You severely underestimate the value that these three companies have brought to the US economy over the last 100 years.

Our government needs to help our industrial base just as other countries do. To not do so would be foolish.

UH2L.com