Bankruptcy, Not a Bailout, Is a Better Option for Automakers

[ntn1987]

A failed corporation is a failed corporation.

[tiburon0676]

If I had the money to buy a new car, I'm so sure I'd buy one from the big three. I'm a fan of GM but I don't see anything they make that's worth buying. They've always struggled with their interiors (very brittle/hard plastic that's very noisy and fails after time)

[8lugz]

thats funny,most ford owners i know complain about the interiors of ford, ive always thought that was GMs strong

point - confort,lol everyone knows that ford has the strong spine-frame-running gear,and gm has the reliable power plant,

the most reliable and easy to maintane

in the world........

[doIgiveafuckno]

I agree with the clip that they SHOULD be allowed to go Chapter 11, but, for the reasons I explained, it will never happen. 

The entire U.S. economy has been hollowed out since Reagan: off-shoring, out-souring, millions of quality manufacturing jobs exported to China. You cannot sustain 265 million citizens with $7 an hour service industry jobs while a minority of financial services PARASITES get paid $million bonuses. The economy is WRECKED. There is not a damn thing Obama can do about it.

[doIgiveafuckno]

They are NOT being bailed out to protect jobs. They are being bailed out to prevent the banks going bust. The Big 3 automakers account for 25% of the corporate bond market, and the Big 5 U.S. banks have $billions exposed in CDS risk. If they go Chapter 11 it will result in banks having to pay out on defaulted loans. Lehman is a walk in the park compared to this.

Unfortunately though, throwing tax money at the car makers will not solve the problem. Where are the buyers for their cars now?

[springer1962]

Man you started out making sense and then you went turtle, your head went right up your arse, but I can still see your belt.

How does GM sell almost 11,000,000.00 cars and have a product no one wants. They have the best looking cars out there open your zipper and look. Toyota only beat them in one segment of sales. Fleet cars are not counted in total sales. Toyota sold 9,543,000.00 gm 8,800,000.00 and then subtract 11,000,000.00 which is the real total. Fleet cars no buy ja cars?

[123ezza123]

ANY GUYS UP?

i liked this video :) cV

[jstall00]

What an idiot, doesn't he know that if any of the Big 3 file for chapter 11 bankruptcy, that will cause a majority of its prospective buyers, to switch to a different brand than buy from the manufacturing company that file for bankruptcy? If that is the case, why don't these financial firms go through a bankruptcy? They seem to be doing fine considering AIG is giving Christmas bonuses away, what a bunch of greedy pigs.

[onstageagain]

My friend, if you are a American. Just the fact that you are here on this subject... If you don't know who Gerald Celente is , you are doing yourself a disfavor. All Americans need to listen for 3 min... right here on You Tube... We are at the end of what use to be a great country Americans. Please be informed ... listen to this on

You Tube...

Gerald Celente warns of the next US Great Depression. PART 1 ..

[FluxCapacitor2008]

I dont under stand are you for saving middle class job?

[Rodney08us]

no need to have the middle class.Just the very rich and masses of poor.Oh by the way the next war be sure to tell the masses of poor how well off they are,they may refuse to fight for the very rich.

[Martian74]

Delta airways was in bankrupcy but people kept flying with it and now it is out of bankrupcy. Bankrupcy protection allows the company to keep trading even though they are insolvant.

[Ulquiorra4th]

so give the bailout for AIG but no for GM that is bullshit!!!!!!!!!1

[ifyourscaredsayur]

My Senators voted no on the $700 billion bailout.They knew it was BULL----!AIG executives had a big retreat & spending sprees

with taxpayer money!Plus these bailout companies are still giving big bonuses to executives.They are just calling them different names.Jay Leno said their excuse is

they will leave if they don't.Leno said yes we

need to keep them around they are doing such a

great job.

[FluxCapacitor2008]

We can kick and scream all we want but the government will do what ever they want to do and we cant stop it, so the Detroit auto makers will get the money the same way the banks got the money and the tax payers will pay for it, all we can do about it is hope that some people will keep there jobs and the US auto makers learn something from it so they can make a better and cheaper car and pay the loans back in the future. So buy the car that you like to drive.

[burgerwisdim]

lend the money, ON THIS PROVISION: a new regime in the executive office of managers and engineers has to be adhered to, to properly remedy and revolutionise the desire for these brands again. there should be appropriate interference from external technical staff -etc-etc that can frontload the necessary design, account management and all other faculty to get these guys moving again. it has to be open to thorough scrutiny and the money feed thru trust account. Otherwise NO !!!

[FluxCapacitor2008]

Keep talking shit butt weeds we all will be out of a job its not just the auto companys going bankrupted open your eyes and look around.

[emforty2]

Bailout is GRAND THEFT AUTO of taxpayers money

you will just delay the inevitable they already failed

they will burn through the billions in couple of months then what ????

[daryl3161]

its a loan. hey how do u feel about criminal bankers who knew what they were doing getting over a trillion dollars of your money. hmm, white colar gets bailed out but not blue?

[librophile]

Congress should heavily fund the "TESLA MOTORS CORPORATION" in California who now produces the BEST ELECTRIC CAR on the planet.

(250 miles range on 1 charge / 0 to 60 mph in 3.9 seconds / Fully recharged in 3.5 hours)

With substantial funding that corporation could become the NEW DETROIT, place millions of Americans to work & produce less costly family cars in the IMMEDIATE future.

This GREEN corporation is who needs help...not GREEDY DETROIT AUTOMAKERS!!

Obama knows this. (Jan 20.09)

[jhood2152002]

That's what the US auto makers get! DO you really expect to make crappy cars and do well in the auto business? WHAT CAN OF PAINT WERE YOU SNIFFING?? I really do not see any Asian or European people driving around in a Ford Taurus or a PT cruiser. Instead I see a lot of AMERICANS driving HONDA, ACURA, TOYOTA, LEXUS, NISSAN, BMW, AUDI, MITSUBISHI, INFINITI, !!!!!

[sueishere25]

I agree. Let them go bankrupt. I think this is just a band-aid fix. These companies are going belly up. People are mad about the bailout and I have heard people say they would buy a Honda or Toyota

[caganb]

GM----- mark of excellence----- Ha Ha Ha Ha let them die. Maybe the CEO can get a job at Walmart as a door greeter. Better yet a shoe salesman. He would take a private jet to the stockroom to find a pair of shoes though

[7514328]

I hope these trucks and cars sit and rust away. Think of how much better we will all be without these costs:No more fuel costs. No more auto insurance, no more registration fees, no more tickets,no more tires, no more oil changes, no more smog fees, no more brake replacement, no more accidents..I believe the automobile is the biggest scam ever...department of transportation would collapse...GREAT.All everyone has to do is stop buying automobiles. Walk to work and YOU MAKE MORE MONEY. Ride a bike

[killergames187]

You people don't get it they are going to fail one way or the other and people are getting fired now!!Jest light the money on fire and save some time.

[FluxCapacitor2008]

We need to save the jobs now, we have lost too many

Now is not the time to make the CEOs pay, we can slip into a depression economy

[FluxCapacitor2008]

Yes all the CEO at any company is over paid, but we cant let a couple bad apples spoil the bunch. People may think my job is safe and not tied to the automotive industry but it is in some way.

[FluxCapacitor2008]

If we had more people in unions more people would make a living wage and have health insurance, big business has every one divide and brainwashed how can anyone live on less then $12 dollars an hour and pay for have health insurance and a lot of people do, I was like a lot of people and thought the unions workers are overpaid and underworked, but the truth be told non union works are underpaid and overworked. We need to come toghther and build the middle class up not knock your neighbor down.

[MPratschner]

If we had more people in unions, then we would have nore industries asking for handouts on Capitol Hill because they would be burdened down by senseless union contracts and not be economically viable.

[FluxCapacitor2008]

Union buster brainwashing, a union contract protects the workers and helps to maintain a liven wage; the car companies are asking for a loan not a handout. Also it is the Wall Street big shots and politicians got us in this Hole no one is buying anything and losing their houses because they have on jobs. The down turn may not have hit you but it will. If your neighbor house is burning you need to help put it out before yours burns

[MPratschner]

There is no question that unions had their time in the US and that a lot of gains were brought about by unions, but their time has passed.

[vteclobe]

to hell with the UAW. they'er the reason the big 3 are crumbling. everthing was culminated by the UAW. everything from the lack of R&D money for the big 3 to develop future concepts, to the SUV product that rolled off the assembly line. the ONLY way the big 3 could turn a profit was to sell SUVs, they couldnt sell anything else with the UAW ball and chain on their leg. they're going to move to a right to hire and fire state. fuck michigan and stupid ass states like them.

[AJstar9]

@vteclobe what a dumb ass they sold suvs because thats what people wanted

[mog404]

If the big 3 manage to siphon money from the taxpayers(thinly disguised as a bailout), how long will it be until they siphon more taxpayer money?

The big 3 are garbage companies that build garbage vehicles. With the exception of the vehicle's computer, a "new" GM, Ford and Chrsyler vehcile is really recyled 50+ year old technology.

I recently toured the BMW showroom in Munich. BMW's vehicles are truly works of art and light years ahead of anything domestically produced.

[robertus911]

Why don't the auto makers borrow the money from the banks that we bailout. They won't pay the tax payers back. They will take them for granted.

[MPratschner]

The union contracts are the problem.

When I was in college I painted industrial bldgs. over Christmas break while the plant was closed down. The union said they needed a skeleton crew present. So, these $20/hr. guys were in there (doing nothing) over the weekends, so that's double time, and it was a holiday, so that's triple time. 6 guys in the plant sitting around all weekend making $60/hr on their union imposed skeleton crew and not one bolt on one car got assemled. My tax $ to fund that? No

[FluxCapacitor2008]

big baby cry me a river hes making more than me, if we had more unions we would have more people with life insurance that making a liven wage. Support your neighbor do not knock him down.

[MPratschner]

Respectfully, you missed the entire point. I make good money now and have health insurance(without a union) and my post had nothing to do with jealousy of anybody. If Ford Motor Co. pays 6 guys $60 and hour to do nothing, for 4 days, that's $11.520. Do you think Ford absorbs that cost? I doubt it. They either pass it on to the buyer in higher selling price or cut quality on the car elsewhere. Why was 1 penny of that $ necessary? No. Like I said, the union contracts are the problem.

[FluxCapacitor2008]

You may have health insurance but the number of people without health insurance continues to grow. Under the Bush Administration the number of uninsured Americans went from 39.8 million (14.1%) in 2001* to 47.0 million (15.8%) by the end of 2006

[AJstar9]

@MPratschner then why is ford doing so great now.why are they making more money and got more market share

[MPratschner]

@AJstar9 - define" so great". And, if they cut out the fat [aka unions], they would be doing "so greater"

[AJstar9]

@MPratschner great means a bigger market share and more profit then toyota,plus both jd power truck and car of the year.sorry the uaw isnt going anywere

[AJstar9]

@MPratschner THEN WHY ARE TOYOTA CARS AND TRUCKS JUST AS HIGH

[MPratschner]

@AJstar9 - my point is imple. Unions artificially inflatethe cost of goods because their wages are artificially inflated, and the end consumer has to py for them. I got nothing againt you, or anybody union or not - I can only talk about my experiences, thats all

[AJstar9]

@MPratschner like i said toyotas and honda are around the same price as are cars and trucks the union isnt ,makeing the costs of cars higther.if it was because of union wages thoses cars would be cheaper.have you seen the price of a 4runner $35,000 thats higher than a ford suv

[jvmalum]

Listen, everybody has 2 cars in the drive. if one was a pure Ev 100 mile, that's good for 340 of the 365 days a year. Then gas would be so cheap you take fuel cars on trips. There is only one good reason for not building electric cars, that is that the Car companies REFUSE TO, because there's nothing on them that WE can't fix OURSELVES. Their combustion engine tech. is to complex, therefore we have to pay THEM for the repairs and labor, hence they keep on making money long after the sale

[cobracrewcheif]

NO bailout. Screw the United Auto Workers Union. the whole bailout thing would not be an issue if the UAW voted Republican. Dems can't lose those votes. Fuck em.

[AJstar9]

@cobracrewcheif AND FUCK U

[thoughtchallenge]

Bailing out would be a mistake, since essentially you would be paying these companies to idle their plants until a better time comes. They have estimate that the real run rate for autos would be about 15 million in U.S. were the economy in recovery mode. If you do divide 25 billion dollars by 15 million cars that equates to approximately $1600 per car. Why not give this money to consumers in the form of a rebate for any vehicle purchased.Automakers and dealers could add their own rebates also

[tenzingyatso]

So tell me what accountability and change has come from bailing out wall street? The same people are in power doing the same things. What a sick joke!!

[doctender77]

This seems like commonsense but commonsense is in short supply in Washington D.C. Where does the money for all this corporate welfare come from? At this point it doesn't even come from us. The government has borrowed so much money that at this point the national debt and the budget deficiet may as well just be imaginary numbers. Fitting since the dollar really is just imaginary money.

[emforty2]

Bob Lutz of GM siad couple of years ago that Toyota is losing money on the Prius and its a publicity stunt.

true toyota WAS losing money on the prius but now ?

laughing all the way to the bank while GM sinks........ "LIKE A ROCK"

[choices4good]

Please let the stinky american turd auto companies die. We don't need more poop on the road. The workers can go work for Honda or Toyota and everyone concerned will be much better off.

[zachlol9]

What a stupid comment.

[AJstar9]

@choices4good toyota is junk recalll

[AJstar9]

@choices4good no thanks i will keep my job at ford ,i like working for a USA COMPANY.MY GRANFATHER DIE WHEN JAPAN BOMBED PEARL HARBER. SO I THINK ITS A SHAME WHEN PEOPLE SAY THEY LOVE JAPAN AND THERE JUNK

[2ndAmendment1]

In the early 70's, Holley Carburetor came up with a carburetor that could get 80 Miles Per Gallon (The OIL companies paid off the Big Three to remove it from the market) so feel sorry for the big three? NOT ON YOUR LIFE !

[AJstar9]

@2ndAmendment1 WHAT KIND OF DRUGS YOU ON

[jwoodswce]

Good points, but another area of restructuring is also needed: government regulation.

I recently heard Yaron Brook of ARC make an excellent point about CAFE standards forcing the big three to create unprofitable vehicles.

If their structural costs are prohibitive, then the government compelling them to make these unprofitable cars, as well as other regulations, are a significant part of the problem.

[blackdenali7]

nobody is going to bail me out..they paid them union employees way to much money...so the way I see it...you did it to youself

[2ndAmendment1]

Who the hell are the CFO's and ACCOUNTANTS of the Big Three - they had NO clue what was happening all these years? WHAT A BUNCH of MORONS ! and CPA'S? also known as Certified Pompous Asses !!!! GM FORD CHRYLSER? you deserve to go bankrupt -- most cars you see disabled on the road are AMERICAN cars !!!!! so much for affirmative action and obscene top EXECUTIVE SALARIES!!! enjoy eating now at the White Castle MORONS!

[5M1L3]

My thoughts are if you think the auto industry is too important to fail, and if you want to bail them out, here is my suggestion.

Buy one of their cars.

If you are going to bail out a company you might as well get something for it. If we bail out the big three automakers the way we are bailing out the banks we won't get anything in return. Just more of the same stuff that created this situation in the first place.

[sep0507]

I agree, buy their cars. I find it absurd that the American consumers buy Jap cars anyway. I especially cringe when I see Boomers and the elderly drivers in Jap cars. Didn't their parents fight against the Japs like mine? And don't say quality is better because that ship sailed years ago. There is an almost non-existent gap in quality today but nobody talks about that. They're too busy running down hard working Americans at the Big 3. Give them the LOAN, not a bailout as it's mistakenly called.

[mitchkramah]

Why should I buy an American car when the foreign market makes a better product? Why should I support an industry that brought the union upon itself and didnt improve vehicle quality until better built vehicles from japan and germany forced them to? Why should I not allow free-market darwinism to run its course and weed out the incompetent? Why should I support an industry that has drug its feet in complying with CAFE standards allowing Japan to introduce the hybrid and OWN THE MARKET!?

[zachlol9]

Why should i support my own country?

[mitchkramah]

This has nothing to do with nationalism. Toyota employs more americans then GM! So if you really wanted to support your country, youd buy a camry over a malibu

The big 3 represent everything that is wrong with our country... they're 3 underacheiving companies that would rather focus their dollar on profit rather then taking risks on innovation. They're turning into a backwards Japan; they take something that already exists and make it worse. The foreign market makes a better vehicle, PERIOD

[AJstar9]

@mitchkramah THATS A LIE TOYOTA DONT EMPLOY MORE THAN GM

[mitchkramah]

@AJstar9 I never said that toyota employed more people then GM did.

I made these posts way before the toyota recalls took place, and up to that point, toyota's and honda's had a bullet-proof reputation for quality. it was also thanks to those companies that the big 3 finally got off their asses and began to modify their line-ups in order to raise their CAFE.

japan innovates and we imitate.... how ironic!

[AJstar9]

@mitchkramah THE FOREIGN MARKET DONT MAKE BETTER CARS AS YOU CAN SEE THE RECALLES ARE STILL COMING,THE IS NO FAIR TRADE WITH JAPAN THEY WONT ALLOW BUT A FEW CAR SOLD IN JAPAN.WHILE WE ALLOW AS MANY AS THEY WANT TO SHIP OR BUILD HERE.FORD HAS HYBRIDS THEY EVEN HAVE THE BEST SELLING SUV HYBRID THE ESCAPE

[mack70214]

as much as it pains to say this but my next vehicle will be a toyota sequoia. it was the escalade, but it's just too expensive to buy and

maintain. besides, it's just a yukon with a cadillac sticker anyway

[zachlol9]

Get a Tahoe if you did the reaserch they are actually more fuel efficent more reliable and better looking than a Sequoia.

[ubuibiok]

None of the Bid 3 Management have taken a pay cut.

That is paramount to even consider a Taxpayer Bailout!

Only pay to retool to Diesel and Electric Auto production. NO MORE GASOLINE ENGINES...

[PhotonDrive]

"Restructured" misses the point. It is TOO LITTLE, TOO LATE! Cheap Fuel-Less Transport tech has been invented. Cars don't have MOTORS anymore, are not even "machines" ( more than one moving part). That even the computer bloogers don't understand the transport is going solid-state in entirety, comments pungently on just how behind the curve US has become! Get HIP, or you all WILL end up on bicycles (if lucky)!

[aprocrastinator]

Why can no one understand these principles. People only consider "three million jobs lost" without realizing that assumes all three companies disappear, quite buying anything from their suppliers, and no other auto company hires any of those workers. Simply absurd.