Just one year’s worth of profits for the oil industry is approximately three times what the auto industry is asking for in their bailout package. If these five companies bailed out the US auto manufacturers, they would still be able to report billions in profit...
So here is my question: Since the oil industry is making record profits and the auto sector is on the verge of bankruptcy, shouldn’t the oil industry, instead of the US citizen, bailout the auto sector, especially considering how interconnected their business models happen to be?Just one year’s worth of profits for the oil industry is approximately three times... more
It might be hard to find a better example of biting the hand that feeds you. American automakers, the subject of much attention and beneficiaries of a major financial bailout, are suing the federal government.It might be hard to find a better example of biting the hand that feeds you. American... more
Weary Democratic congressional leaders and White House officials agreed in principle Tuesday on a $15 billion bailout of U.S. automakers that would give the government extraordinary power to restructure the failing industry. But the rescue faced snags as Republicans raised deep concerns.
A breakthrough came when negotiators reached a compromise to require the "Car Czar" to revoke the loans and deny any further federal aid to automakers that don't strike a deal with labor unions, creditors and others to ensure their survival by next spring — essentially pushing them into bankruptcy.Weary Democratic congressional leaders and White House officials agreed in principle... more
"...automobiles made overseas are stacking up at ports and parking lots around the United States as supplies far outstrip demand amid the nation's worst auto market in more than 25 years.""...automobiles made overseas are stacking up at ports and parking lots around the... more
The CEO s of the big three auto makers are finding many skeptics in congress. This is after a two week break in talks over a now potential $15 billion bailout. Members of Congress in general are fatigued after much deliberation over the country's economic downturn. Would taxpayers be giving money to losers? Or really bailing out companies that have just come on rough times? It's obviously not that simple, but a decision--and lots of oversight--needs to be set.The CEO s of the big three auto makers are finding many skeptics in congress. This is... more
Detroit's Big Three auto makers presented turnaround plans to Congress on Tuesday that indicate both General Motors Corp. and Chrysler LLC could collapse by the end of the month unless they get billions of dollars in emergency government loans.
As part of a renewed bid for a bailout, GM said it needs an immediate injection of $4 billion to stay afloat until the end of the year, a fact it hadn't before disclosed. In total, the company said it needs $18 billion in loans -- $6 billion more than it said it would need just two weeks ago.Detroit's Big Three auto makers presented turnaround plans to Congress on Tuesday that... more
U.S. auto executives warned Congress on Tuesday that their industry was teetering on the brink of disaster as they pleaded for a $25 billion aid package despite political opposition to another multibillion-dollar government bailout.U.S. auto executives warned Congress on Tuesday that their industry was teetering on... more
"The Dow was trading at a hair above 200 points, the Soviets had just declared themselves a nuclear power and the US population was half of today's level. Much has changed since 1950, but the share price of the world's largest car company, General Motors, is back to where it was in those heady days of American industrial supremacy and there is rampant speculation it is heading to zero, with Ford - which yesterday announced the departure of its chief financial officer - not far behind.
The collapse in domestic auto sales to the lowest level since 1992 and a poor outlook make it likely that Detroit's big three, rounded out by privately held Chrysler, will burn through much of their cash by late next year. Bets on their debt in financial markets give low odds to their creditors getting all their money back over the next five years. CMA Datavision puts the probability of default for Ford and GM at 90 and 97 per cent respectively.
But the rumours of the US auto industry's death may be exaggerated. Even under a nasty sales scenario, voluntary bankruptcy filing makes little sense. It would do nothing to boost demand and, after concessions on wages and healthcare by unions last year, would not result in much better labour terms. Bankruptcy would help shed unsecured debt, but this is not the US auto industry's big problem. It is that their cost structures are still too big for their shrunken domestic market share, currently about 44 per cent, down from a virtual monopoly 35 years ago.
The easy credit that put more cars on American roads than licensed drivers is history. After decades of management miscues, though, executives in Detroit have made big adjustments in order to sell better cars to a smaller slice of a shrinking market. The credit crisis is gaining speed, but it is far from certain to catch up with an industry that now has the pedal to the metal.""The Dow was trading at a hair above 200 points, the Soviets had just declared... more
"The company said Thursday it will start producing the Prius in 2010 at a plant it is building in Blue Springs, Miss. Toyota already builds a hybrid version of the Camry sedan in Kentucky, but this will be the first time the Prius, which has been on sale for more than a decade, will be built outside of Asia." -MSNBC
Toyota is also planning on temporarily stopping US production of its trucks and large SUVs because of declining demand. The plants will either temporarily close or build hybrid SUVs instead.
This is great news both for the environment and for our economy. It will ultimately result in more jobs for Americans and strengthen the "green-collar" job market. This is evidence of our economy's shift in the right direction.
What do you think?"The company said Thursday it will start producing the Prius in 2010 at a plant it is... more
