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Do You Favor A Government Loan To The Detroit 3?
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My friend "dogged" his privately owned Geo Prism built and assembled by Toyota every day harder and more severely than any rental has probably ever gone through.
Didn't even make the car blink before 100K miles and my babied Dodge was crying from day 1 despite all the pampering. That's what I like about high quality well-built cars, you can flog and torture them, you can beat them, you can crash them, you can race them, and they take that lickin' and keep on tickin!
If they can't handle aggressive driving, they should be sold as cars. They should only be advertising the product as "Disposable" Temporary modes of transportation.
I am absolutely100% convinced and positive that the sole reason GM went with the longer powertrain warranties was because they knew they'd never have to pay for them due to bankruptcy or gov't bailout. It has nothing to do with the quality of the cars, which is non-existant.
Has anyone asked a Chrysler dealer if the lifetime warranty for their vehicles is based on the lifetime of the vehicle or the lifetime of the company?
If no one here has done that yet, I might visit my local Chrysler dealer in California for a fun visit where I can basically give all the workers the bird and say "I told you so ten years ago!"
Compare it a similarly priced Mazda3
I seriously doubt the BIg 3 bailout would even pass in biased Michigan. Unless the Big 3 employ more than 50% of the state, I'd say that bond measure would fail in all 50 States.
Michigan woudl probably be the closest race, but even those people realize that investing in the Big 3 makes no financial sense.
Who here has said giving money to AIG was right or acceptable? I don't think they shoudl have received a penny.
And Frankly, I don't give a damn about the Big 3, in fact, Chrsyler owes me $15,000 plus interest since 1994 when they sold me that :lemon: . They should refund my money and go bankrupt after doing so, and don't let the door hit you on the way out! :mad:
Lightyears ahead.
Now in person, the difference might be 10,000 to 100,000 times, as video or seeing it in person is worth MORE than a thousand words. The disparity of quality is even greater when you see it with your own eyes in the flesh!
Also, I had the 2003 Accord with a black interior and it was still mighty fine, inviting, and comfortable. Even black or grey can be awesome when done right. I too... prefer beige, but my last 2 vehicles were black and gray.
Care to show the interior of a gray colored Audi A3? I love it!! (though the beige is best in my opinion).
Today at Fortune, an article explained the pain that would come to the Asian transplants if GM, Chrysler, or Ford were to fail. The transplants parent companies want the D3 to be bailed out. I guess most people don't realize that a huge portion of all the parts that go into a new car are made elsewhere by other companies ranging in size from very small to $20 billion a year in sales. Those companies all cut each other's throats to get business from the OEMs. Their profit margins are slim and based on volumes that end up not materializing, as market share is being constantly lost. Many are tetering on edge of bankruptcy and are owed lots of $ by the D3. Many also supply parts for the transplants. The workers at these subsupplier companies often make meager wages. The Japanese companies treat these subsuppliers so harsh that they usually lose money in dealings with the likes of Honda and Toyota, who hold an artificially higher and often unnecessary standard and reject many parts. These are not a healthy bunch of companies and the only money they actually make is with their D3 accounts. The transplants do, however have many Japanese owned partners who were invited over from Japan to supply the high value content parts used in the transplants. These guys are trying to steal away the D3 business from Delphi, Visteon, JC, and others. They don't want the D3 to go away either. I think the group that wants the D3 to go away is pretty much limited to Asian car owners who know very little about the auto industry.
Do you have any data to back that up? I made that suggestion about a year ago and was bombarded with links saying the imports treated our suppliers much better than the Big 3. Some suppliers are selling to the B3 COD. I have not read that about Toyota or Honda.
I am sure with 4-5 million less vehicles sold next year many suppliers will go broke. That is the way it has always worked. The weak die and the strong get stronger.
How do you think throwing money at the Big 3 will help the suppliers and dealers that are going broke with the downturn in the economy?
PS
It is doubtful I would waste money on a GM vehicle again whether they survive or not.
Wagoner has been pretty disingenuous about this. He claims that the reason GM is having problems is because of the bad economy. Partly true, but GM was extremely fragile going into this and many other car makers were not. The real question is "why was GM so fragile when other auto manufacturers were not?". A large fraction of that answer has to do with Wagoner's past decisions as CEO and head of NA Operations.
Of course it is better spin to blame it on the economy. But the root cause is elsewhere.
r u kidding me? Get the blinders off your blind eyes Dave....
Rear Leg Room
Mazda3-> 36.3 in.
Cobalt ->33.7 in.
Rear Shoulder Room
Mazda3 -> 54 in.
Cobalt-> 51.4 in.
http://www.edmunds.com/apps/nvc/edmunds/VehicleComparison?styleid=101037241&styl- eid=101028087&maxvehicles=5&refid=&op=3&tab=specs
They should have also asked them what percentage would buy from a solvent American car company! Might not be a big difference.
I guess most people don't realize that a huge portion of all the parts that go into a new car are made elsewhere by other companies ranging in size from very small to $20 billion a year in sales. Those companies all cut each other's throats to get business from the OEMs. Their profit margins are slim and based on volumes that end up not materializing, as market share is being constantly lost.
Sales are going from 16M to 10M per year. Regardless of the fate of the D3, those suppliers are going to hurt and I'm sure some of them will go belly up. The stronger ones will get new contracts.
The Japanese companies treat these subsuppliers so harsh that they usually lose money in dealings with the likes of Honda and Toyota, who hold an artificially higher and often unnecessary standard and reject many parts.
It was the American makes that perfected the art of squeezing their suppliers in the past 10 years. Perhaps those "artificially higher standards" are one of the reasons the Hondas and Toyotas have a reputation for quality and durability that the D3 lack.
I think the group that wants the D3 to go away is pretty much limited to Asian car owners who know very little about the auto industry.
Realize that some people who "bash" the D3 really want strong competitive domestic companies. We just don't see it ever happening with the D3 in their present form. Your comment about parts with too much quality shows that there is a lot of convincing to do.
Time to take the headphones off your ears too Dave...
Mazda3
Db @ Idle: 41.1
Db @ Full Throttle: 75.0
Db @ 70 mph Cruise: 70.7
http://www.edmunds.com/mazda/mazda3/2008/testdrive.html
Chevy Cobalt
Db @ Idle: 45.9
Db @ Full Throttle: 76.1
Db @ 70 mph Cruise: 70.5
http://www.edmunds.com/apps/vdpcontainers/do/vdp/articleId=134506/pageNumber=2
Spoken like a true GM/UAW lax employee.....
Yeah the piston rings are only 10 microns larger, why reject it? This is not for a cadillac. It is only an Impala engine.
The manifold is not machined true, but it is OK. We cannot spend more time and money on a middle class product....
Ha...
You must be drinking and replying Dave.....
Pricing
MAZDA3
MSRP $15,590
Invoice $14,616
4 Speed Automatic -> Not Available
4 Speed Shiftable Automatic-> Standard :shades:
5 Speed Manual -> Not Available
Cobalt
MSRP $15,660
Invoice $14,799
4 Speed Automatic-> Optional
4 Speed Shiftable Automatic ->Not Available :sick:
5 Speed Manual -> Standard
Dave
Hate to say this, but the reality is completely the opposite. Just compare the fate of two companies - Delphi (supplying to GM - now bankrupt and likely to be liquidated) and Denso (supplying to Toyota - extremely profitable, market cap 14Bn USD today, or 5x GM). And there is a lot of research available on why that happened (one sample posted below) - Surely if it was as you say, the numbers would be the other way round?
There are a number of reasons why it turned out to be so, but suffice to say, B3 (led by GM) managed their suppliers through spreadsheets and price competition (lowest price wins), whereas the Japanese (led by Toyota) taught their supplier to deliver best value for money (different from "cheapest") - Over a period of time, this resulted in the B3 suppliers losing their ability to invest in RD / sophisticated production techniques, thus causing quality to deteriorate, while the Japanese developed an ecosystem of financially stable suppliers, ultimately leading to improvement of overall quality (as well as longer investment horizons).
And now an anecdote to show how such investment resulted in cost savings (after all, all these companies need to make money....) - When I visited the Toyota plant in Nagoya a couple of years ago, we noticed that on the second floor of the assembly line, the doors were being loaded on the line with workers wearing a different color of uniform. Curious, we asked why they were dressed differently, and the Toyota person taking us around said "That is because they are not our employees, they work for our supplier". We then asked him if Toyota was not worried about the quality of those door assemblies, since they would directly go into the assembly line, and if there was a problem it would be very hard to resolve later. He appeared a little confused "Why would there be a quality problem? We have taught them how to deliver the quality that is required, and they know what to deliver. And if we keep on checking each part supplier and each stage of assembly, a significant amount of time would be lost just on testing. But if all of us are doing our job, then only one test is required - at the end of the assembly".
And now for some academic research. It is somewhat dated (2000), but I selected it so that it would not be seen as coming from some some pro-Japanese Auto industry research center (MIT has produced tons of such research....even though it is a leading institution in the US). The paper itself may not be very relevant to the discussion here, but note the seven hypothesis the researchers offer. If you go through them (I have listed them below the link), can you really say that Japanse Auto companies are treating their suppliers harshly?
http://www.bsu.edu/mcobwin/majb/?p=278
H1: Japanese buyer-supplier relationships tend to last much longer than U.S. buyer-supplier relationships.
H2: Japanese suppliers tend to take a more active role in the buying firm’s R&D activities than do U.S. suppliers.
H3a: Japanese buyers are more likely than U.S. buyers to provide technical assistance.
H3b: Japanese buyers are more likely than U.S. buyers to provide financial assistance.
H3c: Japanese buyers are more likely than U.S. buyers to provide managerial assistance.
H4: Japanese buyers and suppliers are more likely to swap stock than U.S. buyers and suppliers.
H5: Japanese buyers and suppliers exchange employees more frequently than U.S. buyers and suppliers.
H6: Japanese buyers and suppliers make face-to-face contact with sales agents, engineers, and other employees more frequently than U.S. buyers and suppliers.
H7: Japanese suppliers make a significantly greater amount of customized
Your anecdote exactly replicates received experience with Toyota, Honda and Nissan here in Europe. You earn trust by proving capabality and on you go.......but heaven help you if you screw-up badly. This actually leads to increased pride in your own workforce. They want to be 100% right.
Different mentality with some other auto makers. Trust no-one; which I always thought said more about them than their suppliers.
The recession (I think we can now call it a depression) is much worse in Europe than in North America. Prices in Europe tend to be much higher too, and so something has got to go - like new cars.
2017 MB E400 , 2015 MB GLK350, 2014 MB C250
The Mazda looks classier (and should, since it costs more), but I don't like red backlighting in any car and legal speed should be more than a quarter sweep of the needle.
2008 CTS
The Mazda looks better than that........and the Accord is light years ahead in styling.
All that plastic looks embarassing. Actually, the Cobalt might be better than the Caddie!
2017 MB E400 , 2015 MB GLK350, 2014 MB C250
It might be on the steering column somewhere. I know some people might like the hazard button in an obvious place on the dash, like that Mazda has, but it all depends on what you're used to. And I'm used to having it on the steering column. If I was in that Mazda and needed to turn on the hazard lights, I'd be fumbling all over the place for it!
In my opinion, some of these side-by-side interior comparisons show just how far domestic cars have come. It's not that long ago that you could post a pic of a domestic interior and an import interior, and the domestic interior would look like crap. Nowadays though, they're close enough, for my tastes at least, that I'd have to reserve final judgement until I actually sat behind the wheel.
The issue here is should the U.S. government give $$ to the B3, with the expectation that the companies will be able to pay back the funds. Now I would think we also consider how much money would be needed in total.
As I posted yesterday, Johnson Controls - a very large supplier, has estimated the U.S. vehicle market at 9.3M for 2009. Questions:
1) how much money will the B3 lose in 2009 at that sales volume, if they do not go Ch11 and severely downsize and renegotiate their contracts? Take a look at GM's plan and make an estimate if they do that. What is the total you estimate would have to be taken from the taxpayers, to keep the B3 and its suppliers functioning? $100B?
2) now say in 2010 the market recovers some and is 10 - 11M vehicles. Does the D3 become profitable then? Or how much more do they lose in 2010?
3) Based on what you estimate the D3 and its suppliers to borrow in 2009 and maybe in 2010, how long would it take for them to make enough profit to payback the loans? Would their profit even cover the interest on those loans?
I guess you've missed the regular surveys of suppliers printed in The Detroit News. Suppliers regularly rate Honda and Toyota higher in virtually every categories than the domestics.
It's the domestics who are notorious for appropriating supplier technology and shopping it around for better prices; demanding price cuts in the middle of the contract; and dragging out payments as long as possible.
CTS DASH - 3rd PHOTO FROM THE LEFT
2017 MB E400 , 2015 MB GLK350, 2014 MB C250
Also don't miss the "Offshoring" part of the article. At least the guy is being honest that corporations need to downsize and consider where it makes financial sense to produce, and thus survive this severe downturn.
When it came to my baby girl she wanted an import what a pice of sh-T it turned out to be. I have all the work done on all my cars and the oil is changed on all of them at the same time . The toyota has spent more time being fixed than being on the road. The American public is blind when it comes to american quality.
Did you ever have a problem with the 4.1 litre in the '84 Caddy? I think they may have worked out most of the bugs by then, but I heard '82 was the worst and '83 not much better.
I don't drink the import Kool-Aid. If my girlfriend wanted a import, her and her stuff would be out on the curb in a New York second. Fortunately, she is even more "buy-American" patriotic than me. She will search for hours online for USA-manufactured linens and housewares.
I had enough experience with VW in the past not to mess with imports again. Asian cars are just plug ugly. I recall a co-worker who bought a Camry and the water pump failed after only 17K miles. The dude was practically in tears because he literally believed Toyotas don't break!
You got that right. Would you like your security guard to be sleeping while guarding your life? No. So why should any supplier be relaxed/sleeping when supplying the parts? Every job needs to be done honestly and with the intention of supplying the best that you can deliver. The day you start thinking that I can cut back a little on quality so that I can earn more or maybe Ican leave early to watch the NFL game, is the day you also start digging your own grave.
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2015 Kia Soul, 2021 Subaru Forester (kirstie_h), 2024 GMC Sierra 1500 (mr. kirstie_h)
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Unless the D3 agree on making more attractive cars, loans/bailout package is not going to help them out.
Anyways, as a last favor....
>Must depend on the angle and the lighting, because it doesn't look so good in the picture I got;
Is this picture you are referring to?
An unconditional bailout would be the worst thing that could happen to the domestics.
The car I drove also had the lousiest gearbox I've ever driven this side of a 70's Dodge Ram with "3 on the Tree", the steering wheel was cocked to the left while the wheels were turning straight and the acceleration off the line was completely non linear. There was no way to feather the gas pedal in slower traffic.
The interior on the new one is 1 million times improved
yes, but kirstie is right this is not about that, or quality, or mpg, or what other industries got money years ago.
What you are pointing out is something that the B3 might have to take care of next year or 3 years from now. What this topic is about is the NOW and the next few months!
That means:
1) whatever the perception or reality of quality is or pricing, it is not going to change presently. IT IS what it IS right now.
2) the cars and their designs are what they are right now. What they have on the lots and rolling out the doors in the next few weeks determines their life or death.
This loan package is about the Present and the next FEW months. Do 1 or more of them survive past then?
Do we throw the first of many bailouts/loans to the B3, and expect them to pay it back, given that vehicle sales are going to likely be less than 10M units for the foreseeable future? Will the B3 cut their workforce, plants, pension costs, and other costs to match the reduced volume? Or w/o Ch11 does the B3 keep most of their expenses and continue to need $15-$25B every 3 months? Should we give them the first $15B or just let them go Ch11, or whatever they wish?
Or ask yourself why the government needs to manage their business, when the Big3 have hundreds of managers, and could solve this themselves. To me the B3 problems are their family problems, and they should get all the members together and say this is what we're bringing in and we have to cut, or else we go out altogether.
With that kind of leadership, it's no wonder GM is in the situation they are in. Two options: Pre-packaged Chap. 11; or no money and let another company buy GM after they declare bankruptcy. It's no ones fault but the management of GM for their huge legacy costs and poor decisions over the years. They agreed to the contracts with the UAW, now live with them. If you can't, sayonara!
Too many people are losing their jobs across the country. Businesses are going under every day. for some reason, GM deserves to survive???? Some company will buy them once they declare bankruptcy.
Now, does this mean GM doesn't want to spend extra money on battery cars now, is it subtle black mail, or are they having second thoughts about the technology...
GM delays building Volt engine factory
The Associated Press
Wednesday, December 17, 2008
DETROIT — General Motors Corp. says it has put the brakes on construction of a new factory in Flint, Mich., that will make engines for two of its most important new products.
The cash-strapped automaker has delayed big-ticket purchases such as buying structural steel to build the factory.
The plant will make 1.4-litre four-cylinder engines for the Chevrolet Cruze small car and to generate power for the Chevrolet Volt plug-in electric car.
GM spokeswoman Sharon Basel said Wednesday that Volt and Cruze development will continue as scheduled and the company still plans to bring them to showrooms in 2010.
She says the construction delay is probably temporary while the company figures out its cash situation.
GM is seeking government loans to help it survive the worst U.S. auto sales environment in 26 years
2017 MB E400 , 2015 MB GLK350, 2014 MB C250
I loved the 58 Golden Hawk. I had a 1955 Studebaker 2 door hardtop. That was my first car that I made payments on. I bought it in 1962 after getting a job with the phone company. Those old V8 Studebakers would get easy 22 MPG. Much better than anything GM sold at the time.
I'm with you NO BAILOUT for the B3.
White House Wants to See Concessions Before a Bailout
The White House said a decision on whether to provide an emergency loan to Detroit automakers is not imminent and suggested it's not definite either.
Seems that all parties concerned are still in a vise that's going to squeeze more concessions out in a timeframe not of their choosing.
Wagoner has been CEO 14 years. He has never broken 5% profit for GM. He has lost $72 billion in the last 4 years. I think it would be difficult to find a CEO willing to take on the GM mess without Bankruptcy. Kind of like asking a different Captain to take the helm of the Titanic when it was taking on water and headed to the bottom. Wagoner was at the helm all during the 1990s when some folks here claim was great for the Auto industry. If he did not make a decent profit selling 40% how will he do it selling less than 20% with the same amount of legacy expenses?
I'll admit I want revenge and my pound of flesh out of Chrysler, but I'd rather Ford and GM (especially Ford, where they seem to have half a brain) don't go out of business.
However, given the choice between paying my own money or my own tax money to bailout the Big 3, and them going out of business, I'm choosing the latter. That doesn't mean I WANT THEM to go out of business, just that I"m not willing to pay to keep them in business. I like the fact that there are suckers born every day who will buy the Big 3 crap which helps to provide some competition to the really good cars coming out of Japan and Germany and keep their prices in line and in check. Yes, less competition will raise prices from the good cars being built out there, but is the Big 3 even capable of competing? It's almost like the major leagues vs. single A baseball right now.
http://www.msnbc.msn.com/id/28239206/
I see the CTS of that vintage has the same cheep looking and feeling turn signal stalk and windshield wiper stalks as my wife's 07 GP. I wonder if the CTS also features the sound of a breaking finger when using those controls. The gauge cluster looks fine but the rest is bland and certainly non upscale looking.
and even added further to that story, Mercedes alone, which got both Federal, State and Local incentives to locate in AL., after all is said and done, (about 20 or so years) received $220K per job at that facility alone. As of 2007, they were 47th in the country for education, with only three states lower than Alabama. Road maintenance budgets have been cut back as well as education spending being cut. Dumbing down a population serves one purpose and that's to keep them ignorant so that it won't be clear as to what will effect them longterm. The people of SC and AL, at a minimum, don't really see the long term adverse affects by the choice of a few! Sad sad sad.
Merle from Michigan
The Big 3 don't deserve anything because they are just a black hole to finances. They don't have anything to sell to me at a price I'd pay right now.
I'm against bailouts and subsidies (which is really just coporate welfare and white collar welfare), but if someone should get money, it is the transplants in the US and not the Big 3.
So how is that any different than Michigan offering incentives to the Movie industry. At least Alabama was going after NEW business for the USA. Michigan is trying to steal movie companies from CA. How low life is that?
A low-interest loan program will be offered, in addition to an investment tax credit and an infrastructure tax credit program as well as a workforce development rebate for hiring and training current Michigan crew members to a higher level of expertise.
Michigan Film Office director Janet Lockwood said: "With amazing bipartisan support, there is little doubt in my mind that the package will pass, giving Michigan a remarkable incentive."
Legislation is expected to reach the governor's desk next week and go into effect April 1. Features shot in the state include DreamWorks' "Dreamgirls," Fox's "Jumper" and New Line's "Semi-Pro."
http://www.variety.com/article/VR1117982647.html?categoryid=8&cs=1
Under Michigan's program, producers get 40 cents back for every $1 they spend on filming (double the existing rebate) and qualify for an additional 2% spending rebate if the film is shot in designated "core communities," including Detroit and Flint.
The rebate covers salaries of crew members and above-the-line talent up to $2 million per person (so that wouldn't cover the typical fees commanded by the likes of a Brad Pitt or a George Clooney). Additionally, the new law provides a 25% tax credit for companies that invest in new film and digital media studios in the state and would cover 50% of on-the-job training expenses for Michigan residents working as crew members
How long Michigan enjoys its moment in the sun -- yes, there's sun in Michigan -- remains to be seen. The state doesn’t have the quantity of crews or the production facilities of more established locales such as Vancouver, Canada, and New York. And, of course, there's nothing to stop another state from coming along and cooking up even more generous incentives.
Who knows maybe Alabama will offer the movie makers a better deal than Michigan. :shades: