Looks like GM and Chrysler are toast

[genlock]

The POTUS said:

"It is my hope that the steps I am announcing today will go a long way towards answering many of the questions people may have about the future of GM and Chrysler. But just in case there are still nagging doubts, let me say it as plainly as I can -- if you buy a car from Chrysler or General Motors, you will be able to get your car serviced and repaired, just like always. Your warrantee will be safe.

In fact, it will be safer than it's ever been. Because starting today, the United States government will stand behind your warrantee."

[AmpedNow]

So is this the first official nationalization of an industry?

I should now buy from Detroit, why?

[genlock]

Actually, the nations railroads were nationalized during World War one
and the Steel industry was nationalized in the early 1950's (Korean War).
The Coal industry came close in 1942.

[cgarison]

The POTUS said:

"----- if you buy a car from Chrysler or General Motors, you will be able to get your car serviced and repaired, just like always. Your warrantee will be safe.

In fact, it will be safer than it's ever been. Because starting today, the United States government will stand behind your warrantee."

Note to self.... Pontiac G8 GT and CTS are out. Challenger is notgonnahapen.com. Jeeps are now dead to me.

Damn.

Glad I like Ford.

[Jet Black]

Challengers make me quiver. Too bad, the American automobile is now dead, Barney Franked, if you know what I mean. If only GM had been made to go bankrupt as per normal rules, they might have had a chance. Goodbye, American Truck; Hello 2200 lbs. 3-cyclinder Obamabomile.

[AmpedNow]

True capitalists drive Toyota.



Seriously, I see no incentive to buy from Detroit. Just like dealing with a crackhead, you hope and hope that one day they will turn around. But if they don't, you eventually have to let them go into their own demise.

Though I sympathize with the individual factory worker, I don't want a single dime going to the UAW. They are largely responsible for the collapse of the American auto industry. And despite all of this, still nobody in Detroit or Washington dares to tell them to stick it and rewrite these contracts. They haven't given an inch of ground through all of this, even though the hand that feeds them is on the brink of disaster.

I would rather support WV workers at the Toyota motor plant in Buffalo.

Not everyone likes suburban assault vehicles, and averaging 5 MPG. They have treated the compact market as "entry level" throwaway afterthoughts for years, and now they are paying dearly for it. Bigger isn't always better.

Neons and Cobalts are not even in the same arena as Corollas and Civics. But I will give Ford credit for taking the Focus seriously. It's become an impressive car for its class. The Fusion is really nice, too.

After this all shakes out, Ford will likely be the only American car company left. And even they won't last forever if they don't stand up to the UAW.

Though my heart left GM long ago, it's really sad that it has all come down like this... And honestly, GM could eat Honda and Toyota's lunch in value and quality if they didn't have these multiple anchors weighing them down. I was hoping they would one day wise up on their own, but that no longer even appears possible.

Before people accuse us import drivers as "traitors", they should realize that it's not without reason we drive them.

[genlock]

My Nissan P/U truck is 21 years old, has 170k miles and runs fine.
It was assembled in USA with USA workers.
Non-union workers.
Excellent value.

[Dave Loudin]

So is this the first official nationalization of an industry?

I should now buy from Detroit, why?

Those who are complaining that the Administration should not be dictating management changes have never borrowed money from the Small Business Administration. Many parameters, including how much the owner could be paid, were strictly controlled.

[genlock]

TOKYO (AP) - Opening a car trunk or controlling a home air conditioner could become just a wish away with Honda's new technology that connects thoughts inside a brain with robotics.

Honda Motor Co. (HMC) has developed a way to read patterns of electric currents on a person's scalp as well as changes in cerebral blood flow when a person thinks about four simple movements - moving the right hand, moving the left hand, running and eating.

Honda succeeded in analyzing such thought patterns, and then relaying them as wireless commands for Asimo, its human-shaped robot.


In other news, GM announced a pretty, shiny thing that goes on the dashboard.
It is expensive, hard to use, a maintenance nightmare and does nothing useful.

[CoolBreeze]

Five years ago on my radio talk show, I stated many times that the American automobile industry would collapse within 5 years. I also said that their death might drag out to 10, depending on how the government decided to get involved and force this lingering death a little longer.

Needless to say, I never in 5 total years on the air ever had an automobile sponsor.

I cited all the reasons for this, including the Union, the quality (or lack thereof) the mismanagement, the stogy models, the overly vast lineup. I mentioned that the last American car I bought was a (74?) Pinto from the dealer with about 1000 miles on it. The newest car I'd ever owned. I mentioned that the car burned up within 6 months and Ford wouldnt take responsibility for it. I ate over $3000 when I could least afford it. About two years later it was discovered that this engine was engineered wrong and the Pinto engine was burning up all over America. By then the car was off the road due to rear-end explosion possibilities in a wreck.

I swore that day I would never own another American automobile and I haven't. I started with a VW Bug and never looked back. As soon as the Japanese came on line, that's all I've owned, and I've never had ANY problems since.

The fact is, America could never build a 4 cylinder car. An 8 cylinder can run by brute force, but a 4 cylinder must have real serious engineering involved. Taking a walk down memory lane you have the aforementioned Pinto, the Vega (what a disaster) the Pacer, the Chevette, the Fiero, just to name a few. Then they stuck these engines in cars much too big for them, finally moving up to a 6 cylinder version that wound-up being almost as bad. By this time, the Japanese had perfected the 4 cylinder. This is why for instance, Ford bought a big chunk of Mazda, so they could use their engines in Fords.

Of course, much less money is to be made on a small car VS a large one, especially "back in the day", so the American automobile industry didnt even TRY hard to produce anything decent. You finally moved back up to something big... that would run.

After 30 years of same-ole-same-ole, more people like me had had enough. No matter how "Buy American", or patriotic, they'd had enough. In the meantime, GM and Ford continued to crank-em out.... buyers or not. So here we are.....

[Hoosier Daddy]

I pretty much agree with you, Jerry.

[Dave Loudin]

Forget thirty years, GM's problems were fifty years in the making.


538 is an excellent site.

[Bob Campbell]

Yeah, all those years with the unions forcing GM and Chrysler to build SUVS that nobody would buy when gas prices went up. And preventing them from building something to compete with Toyota. Drat those unions.
Are they the same unions that caused the Wall St. collapse?
It'll be interesting to see what happens to Toyota and Honda when their union retirement costs get to be the same as GM and Chrysler. Should happen in about 10 years.

[Big Media]

Yeah, all those years with the unions forcing GM and Chrysler to build SUVS that nobody would buy when gas prices went up. And preventing them from building something to compete with Toyota. Drat those unions.

Good point. I dunno if it is till the case, but about 2 years ago, I was at Moses in Huntington. They were selling the GMC Acadia like hot cakes at a Ruben Studdard festival. It was, at the time, the hottest selling SUV on the market. It averages 18/MPG according to EPA estimates. However, owners are reporting much lower 15 to 16 MPG.

At the same time, gas was well over $3.00/gal.

[genlock]

If GM and Chrysler go into bankruptcy protection, the UAW and their retiree's
Might just have to kiss the gravy train goodbye.
Ford would then have to consider re-negotiating their contracts
to reflect the new economic realities.
It will then suck to be an auto worker.
At least a union one in Detroit.

[AmpedNow]

I'm not anti-union per se, but the UAW is ridiculous.

Then again, the Big 3 shouldn't have signed those ridiculous contracts in the first place.

It'll be interesting to see what happens to Toyota and Honda when their union retirement costs get to be the same as GM and Chrysler. Should happen in about 10 years.

They won't, because they're non-union. Their bolt turners make roughly half what Detroit bolt turners make.

They also won't retire workers at 50 with lifetime pensions worth as much as they were making while working.

They are also more receptive to market trends and changes, which is why they are eons ahead of Detroit in the compact market.

Toyota is extremely anal about quality control. They will shut entire plants down to correct a simple door rattle.

They won't make the same mistakes that Detroit did.

As for Jerry's comments, he's spot on. I've dealt with more than my fair share of GM junk. '85 Chevette, '84 Cavalier. Neither of them made it to 150k. That's about the break-in point of a Toyota or a Honda.

[Hoosier Daddy]

If GM and Chrysler go into bankruptcy protection, the UAW and their retiree's might just have to kiss the gravy train goodbye..

For the life of me, I'll never understand how decent, hardworking ordinary people have so much resentment and hatred towards other decent, hardworking ordinary people who are retired now and have a pension after working somewhere for 30+ years...

[CoolBreeze]

As I mentioned in my post, almost everyone had a hand in the demise of GM... including the Union. It wasn't at all unusual for the union workers to sabotage cars all though the manufacturing era. For instance, in Lordstown Ohio alone, some estimates set the number of deliberately disabled cars as high as 500,000 for the period of December, 1971 to March, 1972. The Report of a Special Task Force to the Secretary of Health, Education, and Welfare on the problem. titled Work in America, was published in 1973. Page 19 of the study admits the major facts: " absenteeism, wildcat strikes. turnover, and industrial sabotage have become an increasingly significant part of the cost of doing business."There were many other instances of this. I'm not saying that the Union didn't have legitimate gripes at times. I'm saying that the buying public can only purchase so many bad cars... that have been made even worse by the workers themselves. Seems to me the workers cut off their nose to spite their face, and that certainly didn't help the reputation of the product they were making, nor offer them job security in the long run. You start adding up all the issues, from management down to the janitor, and this is the result.

As a third generation auto worker, born and raised in Detroit, I agreed with many of the points raised in this article, but felt the emphasis was somewhat wrong. I've worked for GM, Ford and Chrysler and my assembly line job at Chrysler's Mound Road engine plant during the '60s made me a true believer -- namely that American cars were junk for too long and that's exactly why they lost their market. The guy working next to me on the line was a heroin addict who shot up in the john during break; the union protected his job and Chrysler's customers dealt with the results of his labors.

Quality control was usually a wink and a nod; my supervisor often passed faulty parts on down the line for final assembly. You didn't need a degree in English lit to perform 8 hours of mindless labor on the assembly line, but many of the workers were functionally illiterate and incapable of understanding basic business or manufacturing concepts, let alone Japanese manufacturing techniques. Some workers actively sabotaged the cars; mindless anger and resentment were widespread among the workers and encouraged by the union. Detroit iron had a reputation for terrible quality; the dictum that you never buy a car assembled on Monday or Friday was no joke.

http://spectator.org/archives/2007/05/09/motor-trends

[cgarison]

Challengers make me quiver. Too bad, the American automobile is now dead, Barney Franked, if you know what I mean. If only GM had been made to go bankrupt as per normal rules, they might have had a chance. Goodbye, American Truck; Hello 2200 lbs. 3-cyclinder Obamabomile.

2200lbs will never happen in this day and age of excessive safety standards. When a base V6 F150 swb 2wd tips the scales at 6500lbs, there is no hope for light, fuel efficient cars. Hell! My land yacht 1973 "Big Bird" Thunderbird with a 460 V8 only weighed 3200 lbs. The current Charger is heavier than my 4200 lb Grand Marquis.

Sad.

EPA/CARB and NHTSA need to get their heads together to make things correct.

[cgarison]

Whoops!

I walked onto a new car lot today and walked away with another Grand Marquis.

It is pretty neat to purchase a brand new car for $10K off sticker. I cannot believe I got a better deal and walked away with less money out of pocket than if I had traded the original GranMa on GranMa 2.0.