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Can you give us some links so we can find out the details - like how much was loaned, and if the loans were paid back?
Do you think the B3 will need more than 1 loan? What do you think the total loan amount will be at the end of 2010? How do you think the B3 could repay this - look at the most they ever made in the last 5 years, and use that to figure when they can payback the total loan, that you figured.
As for the rest of your post, it is irrelevant to the issue of "Can the B3 repay the loans?". We don't care what happened in the past; get over the jealousy, and revenge issues.
The vendors (supplying parts for vehicles being being built), end up going bust, which means Toyota, Honda, Mercedes Benz, Hyundai and others will run into big time supply problems putting MORE people out of work.
Did you read the article I posted yesterday from CBS Marketwatch about Johnson Controls? I guess not, because they are a very large auto supplier, and yes they are cutting to meet a market of 9.3M vehicles; but they do not see their business failing if one or more auto makers goes out of business.
Despite sales going from 16-17M / year to 9.3M next year (about 45% drop), that the taxpayer should foot the bill to keep the suppliers and the B3 at the same 16-17M level? Is this correct?
I think most of us just naturally figure that the number of suppliers, workers at the suppliers, plants, UAW, and salary workers of the B3, would be cut 45%? This is what happens in every industry. Is there some disconnect here, that pro-Detroit people would not think this is normal!
Is normal in Detroit that everyone keeps their job and gets paid well, no matter what happens?!
If not, and you do agree 45% of all auto-producing workers need to be cut, then explain why the B3 should not be touched? when consumers have been voting with their wallets that they prefer non-B3 products.
GM Is Likely to File for Bankruptcy, Report Says
By Caroline Salas
Bloomberg News
Wednesday, December 17, 2008; Page D04
General Motors is likely to file for bankruptcy protection with government backing, giving bondholders a recovery of more than 25 cents on the dollar, according to Moody's Investors Service.
There is a 70 percent probability that the restructuring plan for U.S. automakers will consist of a prepackaged bankruptcy financed by government loans to get GM and Chrysler through to 2009, Moody's said in a report dated Dec. 15. Under that scenario, bondholders would be likely to lose less than 75 percent of their investment, Moody's said.
The Moody's assessment comes as the White House weighs a bailout of the automakers. GM and Chrysler are seeking $14 billion in federal funds to keep operating through the first quarter of next year. GM debt traded yesterday for as little as 7.7 cents on the dollar, so if Moody's recovery prediction is right, bondholders stand to gain.
Here is the link below. No real chance to escape bankruptcy in some form.
GM to File
Regards,
OW
like this? Right?
That is something not mentioned too often. The loan is to get them through the first quarter!!!!!!!
What happens in the 2nd quarter. GM sales will go through the roof because of the new 2009s. At this rate they will need $14 Billion for every quarter, if not more.
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Big error here. Direct labor. What about the corporate overhead, the retiree health costs, the engineers, etc? If only 10% of the cost is labor, then where does the other 90% go? It certainly is not the materials.
This shows the '08-'09 interior.
"That concerns me," he said. "And the other point is that I—I'm not interested in—in really putting good money after bad."
It looks like the money will be spent in restructuring through Chapter 11 bankruptcy or some facsimile there of. The only way I can see GM surviving. Chrysler will probably be sold as parts. Jeep and minivans have some value. Probably not as much as Cerebrus spent buying Chrysler. Though they wanted GMAC and it was all or nothing.
DETROIT, Dec 17 (Reuters) - Citing a credit crisis and dwindling sales, Chrysler LLC on Wednesday said it would shut down all of its manufacturing operations from the end of this week for at least a month.
The blanket shutdown marked a deepening of the financial crisis for the embattled U.S. auto industry and came as Chrysler and its larger rival General Motors Corp (GM.N: Quote, Profile, Research, Stock Buzz) both seek to shore up cash as they seek a federal bailout they say they need to survive.
Also, in the series of pictures they showed a Corvette instrument panel that seemed pretty plasticy and the famous Malibu which wasn't that special and it reminds me I sat in one at a mall. Not impressed, big bulky dash and that feeling of being low and peering out.
Thanks for pointing out those pictures......More Reasons to buy American? I don't think so.
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No. They're just trying to keep some of the $10 movie ticket revenues to stay in their State of Michigan instead of benefiting self-centered actors .
>Alabama was going after NEW business for the USA.
But Alabama was wanting companies who compete with US car makers to help drive them out of business...
2014 Malibu 2LT, 2015 Cruze 2LT,
My point is on the incentives. What difference does it make if you are seducing a car maker or a movie maker to set up shop in your state? It has been going on forever and will continue. I venture to say that 1000s of companies have left high tax states like NY, IL & CA to find a better place to do business. The South offers the most bang for the buck.
Joe the Plumber criminal state worker resigns instead of being fired during 30-day layoff as punishment. Concerned about her safety!!!?
Also in the article Ohio is "matching" Michigan by wooing the movie makers with tax incentives. I see lots of Hollywood cars driving through the area already looking for sites for shooting their next films. :P They probably figure it's warmer than Michigan.
Today's Rush Minute talked about the independent research company checking the validity of the October surprise need for 700 billion to help th financial companies that Bernanke and whats-his-name said we needed immediately. it doesn't seem to have been true. Was it a political ploy to make the economy view worse to help the election? Rush's point was the mainstream media aren't the ones who did any checking on the validity; instead it's a small research company.
The loan to the US car companies is much more needed than the 700 billion was needed.
2014 Malibu 2LT, 2015 Cruze 2LT,
The Associated Press
Thursday, December 18, 2008
WASHINGTON — The Bush administration is seriously considering “orderly” bankruptcy as a way of dealing with the desperately ailing U.S. auto industry.
“The president is not going to allow a disorderly collapse of the companies,” White House press secretary Dana Perino said Thursday. “A disorderly collapse would be something very chaotic that is a shock to the system.”
But, she added, “There's an orderly way to do bankruptcies that provides for more of a soft landing. I think that's what we would be talking about.”
President George W. Bush, meanwhile, said he had not yet made up his mind what action to take. (Why does this not surprise me - the lame duck pres)
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Regards,
OW
Regards,
OW
http://www.nytimes.com/2008/12/18/business/18auto.html?_r=1&partner=MARKETWATCH
1) so if Congress which is elected decides to kill a proposal, a non-elected appointee - the Treasury chief, from the Executive branch will simply override that decision?
2) The Treas. chief can then act as dictator deciding what industry should be saved and who in that industry should be saved? he can play favorites?
3) This czar can also decide how much to give to whom?
4) And the czar can determine if concessions are needed, and how contracts will be rewritten? Again, deciding who wins and losses.
5) And you setup the conflict-of-interest situation where the czar is giving money to possible former friends and golf-buddies like Dan Quayle's Cerberus-Chrysler?
We are a bunch of sheep, giving the government unlimited powers into our lives in all manners, as this is an example of! :mad:
Both of whom otherwise wail about corporate welfare and the Republicans who are supposedly solely responsible for it.
And Bush may be a lame duck, but he's good at ducking. :shades:
Let's see 61 percent of Americans were against the bailout as of 3 December
No reason to hurry there....
http://www.cnn.com/2008/POLITICS/12/03/auto.poll/
Bush is a Republican.
The poll also suggests that a vast majority of Republicans, 70 percent, oppose the bailout, with 62 percent of independents and 55 percent of Democrats also opposed
No reason there....
The UAW has actively opposed Bush and all Republicans in the last several elections- so he owes them zip, nada, nuthin'.
No reason there to ever do anything
The poll, conducted Monday and Tuesday, also indicates that a majority of Americans, 53 percent, don't think government assistance for the automakers will help the U.S. economy.
Nothing here....
"Only 15 percent say that they would be immediately affected if the auto companies went bankrupt," CNN Polling Director Keating Holland said. "Seven in 10 say that a bailout would be unfair to American taxpayers."
I just don't see George having any reason to be real eager to do anything.
Well there is a political benefit to the Rep. to provide some minimal funding - enough to get the issue onto the new Dem. administration and Congress. This is a No-Win issue, and the Rep. want to push the issue to the Dems.; to be the bad guys, one way or the other. So I see enough $ going to the B3 to just survive, so either Obama has to explain why he's pumping $25B/quarter into the Big3, or why he has to rip these companies apart.
Also, I've driven many old 1960s and 1970s vans and pickup trucks over the years and a last-gen CTS is far superior to any of them. You're just using ridiculous hyperbole and jreaching in any way possible to shine a bad light on GM.
About the only thing I on which agree with you is that the new CTS interior is a great improvement.
More stupidity from Rush.
Trust me, Chrysler's demise had little to nothing to do with their current or former owners! Chrysler's flame and light went out when they green-lighted the sale and release of their first 1995 Dodge Neon back in 1994.
With the sale of that car, Chrysler's fate was sealed :mad: :lemon: :sick:
They knew it at the time, and they didn't care, they took (stole?) people's money anyway! Profitable in 1994 and 1995 maybe? Death a decade later, inevitable!
What I can't figure out is why the Germans even adopted a red headed [non-permissible content removed] step child in the first place???? Why did they even pay more than $1 for Chrysler in the first place? Why did Cerebus?
CTS review
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Only reason were to get their foot in the door in the U.S. a little more. Also, there would be some savings with co-developing, that is, some of the MB engineering could be brought to Chrysler at a low cost. It did make some sense at the time.
Now, why Cerebus got involved, I can't give you a reason. They must have wanted a tax write off or, they thought they could turn it around and sell it again. It makes no sense.
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I can't figure this out either. If you look at the J3, in the late '80's they developed their upscale luxury brands. That filled a hole in their lineups. Mercedes was just the other way around. Below the 190/C models, they had nothing. Chrysler would have provided a good established company in which to "trickle down" Mercedes' technology, as well as established assembly plants in which to build Mercedes' and have a greater foothold in the US. I feel it was the German's superiority complex that kept them from doing this. They punted away a good opportunity to fill that "hole" in their lineup.
Huh? Can you rephrase what you're saying for me? :confuse:
2014 Malibu 2LT, 2015 Cruze 2LT,
it was about the money. chrysler had a pile of cash.
NADA Chairman Says 'Auto Bankruptcy of Any Kind is Not an Option'
Better get used to an organized Bank-job 'cause it's the BEST option for the money. Pay now or later, huge re-org needs to happen. Might as well start now...unless you want all the plants to close for 6 months to match '09 auto demand.
Regards,
OW
Regards,
OW
TOKYO (AP) — Toyota's mainstay vehicle operations are likely to post their first ever loss for the fiscal year through March 2009, Japanese media reports said Friday, highlighting the dire conditions faced by global automakers.
The Nikkei, Japan's top business daily, said Toyota's standalone operating result will be a loss for the fiscal year ending March 31, 2009. It did not cite sources. Kyodo News had a similar report.
The reports said that the Toyota group of companies — including Daihatsu Motor Co., which makes small cars, and truckmaker Hino Motors — will manage to post a profit for the fiscal year through March 2009.
Toyota declined comment on the reports.
Toyota Motor Corp., which makes the popular Camry sedan and Prius gas-electric hybrid, has never reported a full fiscal year loss since it began disclosing operating profit in 1941.
But Japanese automakers — which had until recently avoided the serious problems of their U.S. rivals — are getting hammered by plunging auto sales in the key U.S. market and elsewhere.
The surging yen, which erodes overseas earnings, have also battered their bottom line. The dollar has fallen to 13-year lows below 90 yen.
Analysts say calculations show that a loss for Toyota alone may be inevitable, given the strong yen and plunging auto sales.
"It looks as though Toyota will fall into red ink for the full year," said Mamoru Katou, auto analyst at Tokai Tokyo Research. "Things have clearly gotten worse since the earlier outlook of breaking even."
He noted even Honda Motor Co., which has fewer models, is suffering, and damage to Toyota's bottom line was unavoidable.
Rest of the article;
Toyota Loss
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BARRIE McKENNA, GREG KEENAN AND SHAWN McCARTHY
Friday, December 19, 2008
WASHINGTON, TORONTO, OTTAWA — Worried about a chaotic industry unwinding, the White House said yesterday that it is exploring a form of orderly bankruptcy to deal with the rapidly deteriorating financial condition of the Detroit Three auto makers, particularly Chrysler LLC and General Motors Corp.
Experts warned, however, that a prearranged auto industry bankruptcy could doom Chrysler and decimate a vast North American supply chain.
U.S. President George W. Bush insisted he hasn't yet made up his mind what course of action to take.
But White House spokeswoman Dana Perino confirmed that a so-called prepackaged bankruptcy is now on the table.
"There's an orderly way to do bankruptcies that provides more of a soft landing," Ms. Perino told reporters.
"That would be one of the options," she said.
There is widespread belief in industry and government circles that Chrysler no longer has a future as an independent auto maker.
One industry source said a prepackaged bankruptcy amounts to the U.S. government using the Chapter 11 process under the U.S. Bankruptcy Code to bless a marriage between Chrysler and GM.
Such a deal would involve Chrysler's parent, Cerberus Capital Partners LP, effectively trading its ownership in Chrysler for a piece of GM's 49-per-cent stake in auto financing firm GMAC LLC. Cerberus owns the other 51 per cent.
"Chrysler can't operate without significant support," said industry analyst William Pochiluk, president of consulting firm Automotive Compass LLC. "They are no longer self-sustaining."
In a prepackaged, or prearranged, bankruptcy the key players agree to a restructuring deal before a company formally files for bankruptcy protection. This type of arrangement effectively stifles dissent from other creditors, allowing a company to operate as close to normal as possible.
But experts and industry officials said GM and Chrysler's problems may be too severe to do anything orderly. "I'm skeptical it can work," said Barry Adler, a law professor and bankruptcy expert at New York University. He pointed out that auto dealers, workers, suppliers and debt holders have very divergent interests.
GM, Chrysler and Ford Motor Co. have all announced extended plant shutdowns in recent days to deal with plummeting sales and rapidly dwindling cash reserves. GM and Chrysler have said they could run out of cash by year's end.
If suppliers aren't given some kind of preferential treatment, many of those already teetering on the brink of insolvency could go bankrupt, one industry source said.
"I don't think [prepackaged bankruptcy is] possible with companies of this size," said Gerry Fedchun, president of the Canadian-based Automotive Parts Manufacturers Association. GM and Chrysler are too large, and with too many stakeholders, to get an agreement without a formal bankruptcy process in place, he said.
GM denied yesterday that it had reopened merger discussions with Chrysler.
© The Globe and Mail
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According to ABC News, which first reported details of the plan, the loans come with strings attached. The automakers will need to restructure, getting tough concessions from creditors, suppliers and the labor union.
The loans will come from the $700 billion Wall Street rescue fund. Of the $17.4 billion, $13.4 billion will be doled out in the next two months. The loans will be called back if the companies are not viable by March 31.
Tough talk. Sounds a lot like the strict conditions of a bankruptcy to me. I hope that this means we're getting around to getting them to actually restructure and not simply trying to avoid that pain.
Do the automakers now hold the "bankruptcy stick" that will let them get those UAW concessions? Sort of like, "We have to meet conditions to not have the loan called back. If you don't give us these concessions we'll actually file Chapt. 11 and get them anyway."
The thing I found most interesting is that President Bush said that bankruptcy is not what the American people want. I'm not so sure about that from what I've heard. I think there are many people out there who really could care less.
What I predict is a streamlining of product lines. GM currently has four vehicles on the same platform with the Acadia, etc. I could see that perhaps rather than offering different trim levels in each vehicle such as GS, LS, LE, LX, etc. that the brand could indicate the trim level. Ford the base model, Mercury the mid-line, and Lincoln the luxury. Isn't that sort of how it used to be forty years ago?
White House expects GM, Chrysler to tap loans immediately • Loans give car makers three months to restructure • Limits on executive pay
This plan is probably the best solution overall. It would be a huge shock to the nation if the B3 were left to struggle on their own. Just the financial numbers alone, unemployment, suppliers closing, lack of parts for other car makers.......on and on.
And, even more important, "W" can stall the problem until he is out of there!
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Many people do not care if GM and Chrysler go into C11, but this really is the best solution. Give them 3 months to try to get their act together. It isn't a time for 3 million people to lose their jobs. It will ease the pain for awhile at least.
I am sure George doesn't want to have the end of the American auto industry on his resume, along with everything else.
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