GM asks for $16.4B more, Chrysler $5B more

[GroundedSailor]

Originally posted by: Veramocor

Originally posted by: MovingTarget

Originally posted by: Genx87

Originally posted by: Veramocor
Government should come up with a special bankruptcy plan (GM only screw Chrysler one bailout only). Call it chapter X or something. GM declares a chapter 11 like bankruptcy, the government guarantees warranty claims, government supplies a restructuring loan. In exchange the government gets 1st payment status on the loans and a percentage of the company.

In this quasi chapter 11 GM can ditch dealerships, unwieldy union contracts, and excess brands.

Or you can let the company file and restructure or be split up abd consumed into other more healthy competitors. I see the govt getting involved as prolonging the pain. Much like a cancer patient being pumped full of medicine to live 1 more day.

Ideally, that is what would happen, but most markets don't have that kind of efficiency, especially the auto industry (and other heavy industry). You can let them fail, but they will take a LOT of people down with them. Better to keep things going until times are good again, and split 'em up so that they are no longer 'too big to fail', just like the banks.

Other problem is by letting GM fail completely, a company like Ford will fail, it will even hurt the Japanese companies that buy American parts.

Once GM fails, they stop buying parts from suppliers. This causes many suppliers t go out of business. Screwing over companies like Ford andToyota who can't buy parts anymore.

It is estimated that 70% of the parts that go into a car come from suppliers. And these suppliers further depend upon their suppliers for sub parts / materials etc. Think how many suppliers will go under, and the impact on the economy, if GM were to go under.

 

[Strk]

Well, not really surprised on some of the things included in the plan.

Saturn, Saab and Hummer are all going to be sold/phased out. They're going to work on dealer network reduction and continue to reduce the workforce through attrition.

 

[Cattlegod]

Originally posted by: postmortemIA

Originally posted by: MIKEMIKE

Originally posted by: postmortemIA
^indeed, we're not gonna buy them anymore... why pay twice for a car that loses 1/2 of its value every year...

yup, like the CTS, which has best resale value in its class... yup

what an argument by providing the exception to the rule.

Worst 5 Models in Value Retention
Rank Brand Model 3-Year Retention
1. Ford Freestar 27%
2. Ford **Taurus 28%
3. Chrysler Sebring convertible 28%
4. Chevrolet Uplander 28%
5. Pontiac Montana 30%

cached link

lmao, what the hell is this? these vehicles haven't been made for years and years. lol

 

[BoberFett]

Originally posted by: GroundedSailor
It is estimated that 70% of the parts that go into a car come from suppliers. And these suppliers further depend upon their suppliers for sub parts / materials etc. Think how many suppliers will go under, and the impact on the economy, if GM were to go under.

What do these companies plan on doing in the meantime? Building more cars nobody will buy? After those have sat on a lot for a couple years then what? Prop them up again?

We've overconsumed for decades. The economy has to contract.

 

[Zebo]

Originally posted by: jpeyton
Either help the company survive this economic downturn, or start cutting tens of thousands of welfare/unemployment checks.

You're going to pay for it one way or another.

Exactly but try about 8 million people plus retirement and medical for about another 12 million the Pension Benefit Guarantee 'Corporation' aka tax payers will have to pay out - you righties have no clue the hurt should Big 3 go under.:thumbsdown:

Perhaps you may want to think about a novel concept like buying American?

 

[Chunkee]

Originally posted by: BoberFett

Originally posted by: GroundedSailor
It is estimated that 70% of the parts that go into a car come from suppliers. And these suppliers further depend upon their suppliers for sub parts / materials etc. Think how many suppliers will go under, and the impact on the economy, if GM were to go under.

What do these companies plan on doing in the meantime? Building more cars nobody will buy? After those have sat on a lot for a couple years then what? Prop them up again?

We've overconsumed for decades. The economy has to contract.

This is correct... it will do nothing... no one has a job, cannot get a loan, does not want the vehicles they make and they are still overpriced with the so called incentives and rebates... Good lord, I mean really... a decked out tahoe is what like 50+ grand...then it is worth 26 the next year.....WTF...whats the point...those are the cars they are making..no one is buying them...keep giving them money in the hopes some how we will all just have jobs, wake up wanting american cars...and even then magically have the ability to get a loan to get it the car... all arrows point to EPIC EPIC FAILURE!!!

 

[MikeMike]

Originally posted by: Zebo

Originally posted by: jpeyton
Either help the company survive this economic downturn, or start cutting tens of thousands of welfare/unemployment checks.

You're going to pay for it one way or another.

Exactly but try about 8 million people plus retirement and medical for about another 12 million the Pension Benefit Guarantee 'Corporation' aka tax payers will have to pay out - you righties have no clue the hurt should Big 3 go under.:thumbsdown:

Perhaps you may want to think about a novel concept like buying American?

wait, how the fuck did you throw a "you righties" if you take a look, i bet more "righties" buy american than lefties...

 

[Freshgeardude]

Aren't these bailouts suppose to save jobs???

Another article on the matter says... that they want to cut 47k jobs worldwide.

20k of which are in the US


we need to stop bailing out fail companies such as GM. They had poor money management, and they made crap cars for plenty of years.

 

[Jiggz]

Originally posted by: jpeyton
Either help the company survive this economic downturn, or start cutting tens of thousands of welfare/unemployment checks.

You're going to pay for it one way or another.

Yeah, but it's much cheaper with welfare or UE checks! And it gives a breathing room for the auto company to re-structure and have a second life!

If we give them another $12B now how much would it be in the next three months? $24B? then another 3 months for $48B? Le them go Chap 11 and they'll learn to survive!

 

[evident]

when is this shit gonna end? these assholes are going to keep asking us for more money? i reluctantly thought they should get a bailout last time for employee's sake, but i have a feeling they are going to keep begging for more handouts AND they want to cut jobs anyway. fuck them and their crap cars. it seems like there is no option but for them to live w/ the last 30 years of bad management and suffer the consequences, or keep asking us for more money.

blah blah blah defend gm the cts-v and corvette are good yes, but why the fuck do we have to keep bailing these assholes out?

 

[MotF Bane]

Let them die.

 

[Squisher]

Originally posted by: Skoorb

Originally posted by: Genx87

Originally posted by: Skoorb
I hope nobody is surprised by this. It was unequivocally predictable months ago when they first got the loans that they would beg for more money when the run was close to running out.

Of course but remember all that supply chain fear we were fed to justify the first round of waste. Now it looks like all we did was spend 25 billion and will still get the supplier implosion.

But of course, it merely pushed it off a few months. Last year GM said it was burning up to $4B/month, so simple math said that the paltry amount they were getting would merely stem the bleeding for a few months, and low and behold here we are and they are asking for money again as if the first alotment didn't exist.

They will get money, and then again this year they will ask for yet more. This is as predictable as the sun rising and setting.

Sucks to own a Saturn, though, their resale as bad enough. With the brand now on the road to being killed, it will go down even more.

I don't understand something though. GM came up with a plan to put themselves in the black and that plan only asks for $16 billion, yet they were (are?) burning through $4 billion/mo. ???

Now, you can say they're lying through their teeth all day, but I'm sure maybe one accountant looked at this seeing how they know it has to pass muster with a whole panel of Car Czars. Even if they're off by 100% and have to ask for another $16 billion before they can get out of this, I'd have to say that is one fast and big turnaround.

GM said a bankruptcy would cost the government $100 billion dollars. I wonder if they're talking DIP money or lost taxes.

 

[rudder]

Originally posted by: Zebo

Originally posted by: jpeyton
Either help the company survive this economic downturn, or start cutting tens of thousands of welfare/unemployment checks.

You're going to pay for it one way or another.

Exactly but try about 8 million people plus retirement and medical for about another 12 million the Pension Benefit Guarantee 'Corporation' aka tax payers will have to pay out - you righties have no clue the hurt should Big 3 go under.:thumbsdown:

Perhaps you may want to think about a novel concept like buying American?

I did buy American. My last new car was a 2003 Dodge Caravan that sucks ass. Prior to that I have owned a Chevy Blazer that was ready to catch on fire due to faulty wiring. How about they try and make a decent competitive product?

A friend of mine works at Nissan. Maybe my next time I will buy a Nissan and help support his family.

 

[Strk]

Originally posted by: rudder

Originally posted by: Zebo

Originally posted by: jpeyton
Either help the company survive this economic downturn, or start cutting tens of thousands of welfare/unemployment checks.

You're going to pay for it one way or another.

Exactly but try about 8 million people plus retirement and medical for about another 12 million the Pension Benefit Guarantee 'Corporation' aka tax payers will have to pay out - you righties have no clue the hurt should Big 3 go under.:thumbsdown:

Perhaps you may want to think about a novel concept like buying American?

I did buy American. My last new car was a 2003 Dodge Caravan that sucks ass. Prior to that I have owned a Chevy Blazer that was ready to catch on fire due to faulty wiring. How about they try and make a decent competitive product?

A friend of mine works at Nissan. Maybe my next time I will buy a Nissan and help support his family.

Anecdotal evidence only gets you so far though. I've had three cars, all GM. My first one was fine until my brother totaled it. My second one I had for seven years and only had basic maitenance (oil changes, replace brake pads etc). I gave it to my brother to use and it did die. It was out of coolant and instead of stopping when the light came on, he kept driving. Surprisingly, that didn't kill it. It was the next drive when the same thing happened and he cracked the head gasket (no, he didn't fill it with coolant). I currently drive an Oldsmobile and have no issues.

My mom has a 98 Lexus. The driver side window regulator went. The thermostat is broken. The power steering just went.

But again, it's anecdotal evidence.

Anyways, I do hate giving GM more loans. It has been poorly run for decades. A lot of the current issues wouldn't be issues if they'd been managed properly in the first place. At the same time, the shock to the economy if they collapsed would be much worse.

 

[SickBeast]

I just did the math on the Canadian bailout of the auto industry.

Based on the initial $4 billion that our government has promised the industry, that works out to $200,000 for each of the 20,000 employees of GM and Chrysler here in Canada.

Now, they are saying they will give them an extra $3 billion. That works out to $375,000 per employee. The government will never recoup that in taxes even if each employee works for 40 years for GM or whatever.

IMO the money would be better spent elsewhere, and if nature runs its course, companies like Honda and Toyota will create new jobs to fill the gap.

I would assume that in the US the figures are similar to what I just quoted in terms of cost per job saved.

 

[Strk]

Originally posted by: SickBeast
I just did the math on the Canadian bailout of the auto industry.

Based on the initial $4 billion that our government has promised the industry, that works out to $200,000 for each of the 20,000 employees of GM and Chrysler here in Canada.

Now, they are saying they will give them an extra $3 billion. That works out to $375,000 per employee. The government will never recoup that in taxes even if each employee works for 40 years for GM or whatever.

IMO the money would be better spent elsewhere, and if nature runs its course, companies like Honda and Toyota will create new jobs to fill the gap.

I would assume that in the US the figures are similar to what I just quoted in terms of cost per job saved.

They're loans.

 

[coolVariable]

Originally posted by: GroundedSailor

It is estimated that 70% of the parts that go into a car come from suppliers. And these suppliers further depend upon their suppliers for sub parts / materials etc. Think how many suppliers will go under, and the impact on the economy, if GM were to go under.

//thread

 

[SickBeast]

Originally posted by: Strk

Originally posted by: SickBeast
I just did the math on the Canadian bailout of the auto industry.

Based on the initial $4 billion that our government has promised the industry, that works out to $200,000 for each of the 20,000 employees of GM and Chrysler here in Canada.

Now, they are saying they will give them an extra $3 billion. That works out to $375,000 per employee. The government will never recoup that in taxes even if each employee works for 40 years for GM or whatever.

IMO the money would be better spent elsewhere, and if nature runs its course, companies like Honda and Toyota will create new jobs to fill the gap.

I would assume that in the US the figures are similar to what I just quoted in terms of cost per job saved.

They're loans.

If they go tits up they're not.

 

[MikeMike]

Originally posted by: SickBeast

Originally posted by: Strk

Originally posted by: SickBeast
I just did the math on the Canadian bailout of the auto industry.

Based on the initial $4 billion that our government has promised the industry, that works out to $200,000 for each of the 20,000 employees of GM and Chrysler here in Canada.

Now, they are saying they will give them an extra $3 billion. That works out to $375,000 per employee. The government will never recoup that in taxes even if each employee works for 40 years for GM or whatever.

IMO the money would be better spent elsewhere, and if nature runs its course, companies like Honda and Toyota will create new jobs to fill the gap.

I would assume that in the US the figures are similar to what I just quoted in terms of cost per job saved.

They're loans.

If they go tits up they're not.

Uh... yea they can... they have things called factories, and vehicles...

 

[SickBeast]

Originally posted by: MIKEMIKE

Originally posted by: SickBeast

Originally posted by: Strk

Originally posted by: SickBeast
I just did the math on the Canadian bailout of the auto industry.

Based on the initial $4 billion that our government has promised the industry, that works out to $200,000 for each of the 20,000 employees of GM and Chrysler here in Canada.

Now, they are saying they will give them an extra $3 billion. That works out to $375,000 per employee. The government will never recoup that in taxes even if each employee works for 40 years for GM or whatever.

IMO the money would be better spent elsewhere, and if nature runs its course, companies like Honda and Toyota will create new jobs to fill the gap.

I would assume that in the US the figures are similar to what I just quoted in terms of cost per job saved.

They're loans.

If they go tits up they're not.

Uh... yea they can... they have things called factories, and vehicles...

I still think it's stupid. What good is more debt going to do for companies that are already not profitable?

Their factories would produce better cars for a profit if they were owned by the competition.

 

[smack Down]

Originally posted by: Squisher

Originally posted by: Skoorb

Originally posted by: Genx87

Originally posted by: Skoorb
I hope nobody is surprised by this. It was unequivocally predictable months ago when they first got the loans that they would beg for more money when the run was close to running out.

Of course but remember all that supply chain fear we were fed to justify the first round of waste. Now it looks like all we did was spend 25 billion and will still get the supplier implosion.

But of course, it merely pushed it off a few months. Last year GM said it was burning up to $4B/month, so simple math said that the paltry amount they were getting would merely stem the bleeding for a few months, and low and behold here we are and they are asking for money again as if the first alotment didn't exist.

They will get money, and then again this year they will ask for yet more. This is as predictable as the sun rising and setting.

Sucks to own a Saturn, though, their resale as bad enough. With the brand now on the road to being killed, it will go down even more.

I don't understand something though. GM came up with a plan to put themselves in the black and that plan only asks for $16 billion, yet they were (are?) burning through $4 billion/mo. ???

Now, you can say they're lying through their teeth all day, but I'm sure maybe one accountant looked at this seeing how they know it has to pass muster with a whole panel of Car Czars. Even if they're off by 100% and have to ask for another $16 billion before they can get out of this, I'd have to say that is one fast and big turnaround.

GM said a bankruptcy would cost the government $100 billion dollars. I wonder if they're talking DIP money or lost taxes.

It really doesn't matter if it cost 100 billion for bankruptcy and 50 cents to bail them out. The US government should not be held hostage.

 

[Pocatello]

The US government can delay the inevitable for a short time, but for how long? I don't see how Chrysler can survive on its own, too many undesirable cars. Chrysler still have some viable vehicles, like the minivan, the 300C, the Dogde Ram pickup, the Jeep Wrangler, etc. GM has too many brands which sell essentially the same vehicles.

 

[Strk]

Originally posted by: Pocatello
The US government can delay the inevitable for a short time, but for how long? I don't see how Chrysler can survive on its own, too many undesirable cars. Chrysler still have some viable vehicles, like the minivan, the 300C, the Dogde Ram pickup, the Jeep Wrangler, etc. GM has too many brands which sell essentially the same vehicles.

GM's plan includes getting rid of Saturn, Saab and Hummer. They should add GMC to that list IMO.

 

[StageLeft]

Originally posted by: coolVariable

Originally posted by: GroundedSailor

It is estimated that 70% of the parts that go into a car come from suppliers. And these suppliers further depend upon their suppliers for sub parts / materials etc. Think how many suppliers will go under, and the impact on the economy, if GM were to go under.

//thread

No, not "//thread". He is merely pointing out how painful a death of GM would be. It has no implicit defense for the bailout anymore than me telling you I have terminal, incurable cancer, and then in the next breath talking about how I'll drain all my family's net worth trying to cure what cannot be cured.

False logic:

B is good
A helps B
Thus, A is good

 

[Socio]

What ticks me off is they have already been given billions and made no changes to help themselves with that money. They should have been left alone and forced to restructure, shrink themselves down to a more self sufficient status.