Automotive industry bailout: yay or nay?

[VerseD]

Should the US government bailout failing automotive corporations like they did with the banking industry earlier this year?

Congress has been discussing rescue loans for Ford, Chrysler, and General Motors for the last few weeks. Today they said they are on the verge of passing a $15 billion short-term loans to Chrysler and General Motors, which includes oversight of how the funds are spent.

I think that this is necessary. It will save a lot of people from unemployment, and not just people in the automotive industry who screwed up. Congress needs to do it right, though, with enough oversight to actually know where the money is going.

[Generation ABXY]

I say no...or, um, nay, that is.

These companies have failed to evolve, and many of the workers who will be put out of work are the same ones who helped drag them down. The UAW waited until the last possible moment to make any sort of concession, and they are now (rightfully) going to pay the price for their persistent greed. When/if these companies go under, new companies can rise up and take their place, which works out better for us all. It is survival of the fittest, baby, and nothing good can come from artificially keeping the failures alive.

[Variable Gear]

I'm with Gen. Any company (or animal) that fails to evolve deserves to die. If you can't evolve, you won't be in the marketplace very long. Obviously, no one told the big three about this fact.

In addition, I would like to complain about big companies being "to big to fail." In a market economy such as ours, the ability to fail puts extra motivation on companies to continue to react to their consumers. Smaller businesses always have this pressure, but, in our current environment, bigger companies are allowed a ridiculous safety net that prevents failure. This fact should embarrass the entire financial community, although they have a great deal to be embarrassed about as of late.

And, of course, they deserve it. Just like the automakers do.

[KingGorilla]

Here is the thing. The One industry the US should have been subsidizing and "bailing out" is the only one we really make compete internationally. Telcos-Bailed out, monopolies and no foreign pressure, Banks-Bailed Out, name me one foreign bank with a US presence for housing?, Airlines-Bailed out several times, still do not have to compete with foreign carriers in the US.

The one industry that occupies the largest portion of American Jobs was left high and dry. Why were they not developing hybrids and smaller cars? Because we were subsidizing oil, and not paying for R and D into alternatives like the US government promised in the 1970's. How much money has been spent in the last 30 years for alternative energy? How much has been spent to get recharging stations out there for electric vehicles?

So yeah, give them enough rope to hang themselves with, to develop better cars. But also throw them a fucking bone and see what they do with it. At the very least, all three CEOs admit that change is needed, which is more than I can say for the other bailouts that we dished out to a bunch of fucking kids looking for their allowance.

[rein]

I work for one of them.... ...They do not get my sympathy even if I lose my job over it. Wasteful spending knows no bounds.

[Seconds Out]

I say no...or, um, nay, that is.

These companies have failed to evolve, and many of the workers who will be put out of work are the same ones who helped drag them down. The UAW waited until the last possible moment to make any sort of concession, and they are now (rightfully) going to pay the price for their persistent greed. When/if these companies go under, new companies can rise up and take their place, which works out better for us all. It is survival of the fittest, baby, and nothing good can come from artificially keeping the failures alive.

What has killed the Big 3 IMO is the years of pussyfooting with the UAW. The reason that American auto manufacturers dont turn a profit is because the UAW's CBA has them making somewhere around $70 an hour in some cases. Honda, Toyota, BMW, Hyundai, Nissan, are all manufactured in the US, and they manage to turn a profit. The reason is because they don't let the Unions bend them over the table.

[Tron]

I say no on principle. Businesses need to fail when they can't compete. Yes I acknowledge there are reasons to bail them out but I don't think the US government should be in the business of bailing out private companies.

[Generation ABXY]

Of course, we also can’t forget that we’ve bailed out Chrysler once before. While it is true that they managed to pay it back (and early), it seems pretty ominous that when they find themselves in trouble again, they simply return to our doorstep. When and where does it end?

Just to head off the discussion early, I’m also not in favor of a newspaper bailout. Keeping journalists employed at a publication no-one wants to buy – and that you cannot make them buy – is simply “make work” and nothing more.

What has killed the Big 3 IMO is the years of pussyfooting with the UAW. The reason that American auto manufacturers dont turn a profit is because the UAW's CBA has them making somewhere around $70 an hour in some cases. Honda, Toyota, BMW, Hyundai, Nissan, are all manufactured in the US, and they manage to turn a profit. The reason is because they don't let the Unions bend them over the table.

I’ll just assume you’re agreeing with me, since one of my points was that was that the UAW contracts need to be renegotiated to be more competitive (though perhaps I didn't make my point too clearly); all parties involved are responisble for this.

[JayK47]

Yeah, considering who they have bailed out already, I'd say the auto industry is an obvious yes. Funny thing though, I bet they don't get bailed out. Ass backwards over here.

[Generation ABXY]

Here is the thing. The One industry the US should have been subsidizing and "bailing out" is the only one we really make compete internationally. Telcos-Bailed out, monopolies and no foreign pressure, Banks-Bailed Out, name me one foreign bank with a US presence for housing?, Airlines-Bailed out several times, still do not have to compete with foreign carriers in the US.

The one industry that occupies the largest portion of American Jobs was left high and dry. Why were they not developing hybrids and smaller cars? Because we were subsidizing oil, and not paying for R and D into alternatives like the US government promised in the 1970's. How much money has been spent in the last 30 years for alternative energy? How much has been spent to get recharging stations out there for electric vehicles?

So yeah, give them enough rope to hang themselves with, to develop better cars. But also throw them a fucking bone and see what they do with it. At the very least, all three CEOs admit that change is needed, which is more than I can say for the other bailouts that we dished out to a bunch of fucking kids looking for their allowance.

The only problem with that is, some of these car companies did have electric cars once. In the 90’s, the California Air Resources Board mandated that electric cars be sold, and so Chrysler, GM, Ford and some others all released EVs. Unfortunately, they were too deep in the pockets of the oil companies (probably the same reason fuel efficiency didn’t evolve as fast as it could), and they lobbied to have the mandate overturned. It eventually was, and all but a few of those cars were taken back and destroyed, with nary a glance back at the technology until today.

These car companies were greedy and they made their own bed, so I say, make ‘em sleep in it. You may want to give them a bone, but when that bone is coming out of my pocket – and could be used to feed other, more deserving causes – I’d prefer to be a little more discerning, especially when I now have proof that they have no qualms about crawling back for more in a couple of decades.

[zarathstra]

I'm going to say yay, but only because of the economic climate. Credit hard to come by, and starting a car com[any requires MASSIVE investment, even if you're buying up the bones of the Big 3. Without access to large amounts of credit, who exactly has the money to start these new companies to fill the massive hole left by Detroit? No one, domestically at least.

If we don't so this, it will spell the end of the American car for decades, maybe forever. AND you have millions of people out of work. I hate how piss poor those companies have been run over the years, but circumstance demands that we patch over the holes... for now.

[Generation ABXY]

I'm going to say yay, but only because of the economic climate. Credit hard to come by, and starting a car com[any requires MASSIVE investment, even if you're buying up the bones of the Big 3. Without access to large amounts of credit, who exactly has the money to start these new companies to fill the massive hole left by Detroit? No one, domestically at least.

If we don't so this, it will spell the end of the American car for decades, maybe forever. AND you have millions of people out of work. I hate how piss poor those companies have been run over the years, but circumstance demands that we patch over the holes... for now.

I could be wrong, but if there is a gap left by the Big Three, I imagine that might make some people all the more eager to invest in a start-up company - particularly if they have a solution to our consumer woes (like a fuel efficient hybrid, electric or whatever motor) - I mean, now they at least have a chance at competing.

[diablopath]

I'm with Gen. Any company (or animal) that fails to evolve deserves to die.

Would you refuse medical care if you had some awful disease?

Look, they fucked up.
They really fucked up.
But there are a lot of jobs riding on this.
Not just UAW jobs. There is a horizontal relation to so many other industries, it cannot fail.

They need the money, but how it's used needs to be heavily, HEAVILY, regulated. Fuck, offer the companies up for sale to Toyota for christ's sake, but they HAVE to save those jobs.

[Generation ABXY]

Would you refuse medical care if you had some awful disease?

Look, they fucked up.
They really fucked up.
But there are a lot of jobs riding on this.
Not just UAW jobs. There is a horizontal relation to so many other industries, it cannot fail.

They need the money, but how it's used needs to be heavily, HEAVILY, regulated. Fuck, offer the companies up for sale to Toyota for christ's sake, but they HAVE to save those jobs.

Just as a note, plenty of people are denied an organ transplant because they are too sick or lead a poor lifestyle. So, if applicable, I'm not sure your hypothetical is really a supportive argument.

I mean, the U.S. auto industry has already proved it will stand in the way of the consumer demand and that it doesn’t have a viable business model. If we give them money now, you stifle the chance for other companies to spring up by holding the current failures above water. What happens if the car companies fail again, and again? It sounds as though you think we should just keep handing them money because, “Oh, hey, they’re too big to fail!”

So, I ask again: if not now, where and when does it end?

[bean]

I don't know.

It seems like shoddy, stupid business to bailout a company that is failing because they have a shit business model so that they can continue to bleed out, and it's not like the entire U.S. automobile industry is in trouble. The companies who have adapted to the market are surviving and should fill in the gap.

Maybe instead of giving the billionaires that own these companies a bailout, the federal government should just give each of the workers who become unemployed as a result of this a $100K severance. It would probably be cheaper and maybe then they could afford to pay for the loans the bailed out finance industry should have never given them.

But this might be naive. I've taken one college course on economics and all it did was familiarize me with the various terms and an elementary understanding of economic theory. No clear answer was given on how to recover a collapsing economy. . .

Throwing money at businesses with poor business models certainly doesn't seem smart though.

[Generation ABXY]

I don't know.

It seems like shoddy, stupid business to bailout a company that is failing because they have a shit business model so that they can continue to bleed out, and it's not like the entire U.S. automobile industry is in trouble. The companies who have adapted to the market are surviving and should fill in the gap.

Maybe instead of giving the billionaires that own these companies a bailout, the federal government should just give each of the workers who become unemployed as a result of this a $100K severance. It would probably be cheaper and maybe then they could afford to pay for the loans the bailed out finance industry should have never given them.

But this might be naive. I've taken one college course on economics and all it did was familiarize me with the various terms and an elementary understanding of economic theory. No clear answer was given on how to recover a collapsing economy. . .

Throwing money at businesses with poor business models certainly doesn't seem smart though.

Exactly; you don't keep a broken clock on the mantle.

[cassiusregicide]

As painful as it could be if the companies bankrupt, more damage will be done if we reward poor business models. Our ideal market is based off the idea that if companies cannot run efficiently they will either change or go out of business. There will be more long term damage if we support failed businesses to keep failing.

[Variable Gear]

Would you refuse medical care if you had some awful disease?

Look, they fucked up.
They really fucked up.
But there are a lot of jobs riding on this.
Not just UAW jobs. There is a horizontal relation to so many other industries, it cannot fail.

They need the money, but how it's used needs to be heavily, HEAVILY, regulated. Fuck, offer the companies up for sale to Toyota for christ's sake, but they HAVE to save those jobs.
I'm open to conversation on this issue. However, I struggle with how such a policy would be explained. How do you measure whether or not Detroit is using the money effectively. I understand that the jobs are very important, and that the big three have a large impact on other industries, but I'm not sure how the bailout should be structured.

I continue to dislike the concept of bailouts, as it appears as if big companies have a wide safety net. It's too wide, in my estimation. With this kind of safety net, where's the motivation to innovate? Where is the will to succeed going to come from? If a company is big enough and needy enough, our government will stop at nothing to come to their aid. That needs to be changed. There must be implications for all the poor decisions these companies have made. Those in power who did little to prevent this failure need to be brought to justice. Going through the motions doesn't cut it.

The connection between the oil industry and the automotive industry needs to be brought into discussion as well. If the automakers are still in bed with oil producers they will continue to make decisions that have a definite benefit for the oil industry. In addition, I'm not sure that a company can ever prove that they aren't engaging in this kind of action. It's kept in the dark for a reason.

It's a difficult problem, that's for sure. I wish there was an easy answer, but there isn't one.

I would be much more willing to donate this money to the auto industry if we hadn't already helped out people who did not deserve anything. The financial industry bailout was one of the biggest mistakes in American history, and we see its implications to this day. Credit crunch, check. Banks who are unwilling to lend, check. Small businesses, who don't deserve national attention, closing every day. Bailouts only go to the richest companies. That's what irks me most. They had the resources to succeed, but they failed. It's unwise to promote that kind of behavior. It results in the jobs being retained, but for what? For further failure (see Chrysler)? In order to continue to lag behind foreign automakers?

For some reason, I don't want to donate my money to that cause.

[AbeLincoln]

I would've preferred if these guys had gone under before the banks did, so that this would be happening in reverse. Bailing out the auto industry making them more cautious and careful with the banks. Cause the auto industry gives us cars, and jobs that span the spectrum of collar colors, the investment banking firms... not so much.

[ShivaX]

Of course part of the reason they need the money is that the banks aren't loaning it to them. I mean its not like we've thrown a years worth of tax revenue towards banks to get them to loan again... oh wait.

I don't really have an issue with this since its not at all a bailout. Its purely a loan, something the people we did bailout were supposed to be covering, but aren't. So really this comes back to the banks which so far have been happy to take our money and give us jack shit in return for it.

Its a loan, not a bailout, if you want to call it a bailout loan or whatever, fine I guess. Its not like we're throwing away the money with no hope of return (you know like we did with 20 times as much money a month or so ago). The loss of the Big Three would be the loss of a huge chunk of our workforce that would cost us the amount of the loan fifty times over before we recovered.

[NoName]

This thread needs a poll :).

I'm mostly leaning towards no. Though, the Daily Show last Thursday gave compelling and humorous commentary that made me start considering it not being a bad thing.

[Ancalagon]

Here is the thing. The One industry the US should have been subsidizing and "bailing out" is the only one we really make compete internationally. Telcos-Bailed out, monopolies and no foreign pressure, Banks-Bailed Out, name me one foreign bank with a US presence for housing?, Airlines-Bailed out several times, still do not have to compete with foreign carriers in the US.

The one industry that occupies the largest portion of American Jobs was left high and dry. Why were they not developing hybrids and smaller cars? Because we were subsidizing oil, and not paying for R and D into alternatives like the US government promised in the 1970's. How much money has been spent in the last 30 years for alternative energy? How much has been spent to get recharging stations out there for electric vehicles?

So yeah, give them enough rope to hang themselves with, to develop better cars. But also throw them a fucking bone and see what they do with it. At the very least, all three CEOs admit that change is needed, which is more than I can say for the other bailouts that we dished out to a bunch of fucking kids looking for their allowance.

I agree with this. Its ironic that the government bends over backwards to help the banks after they screw up, but are dubious about helping the auto makers. How about demanding the banks give up their private jets and holidays? Oh wait, you wont do that since many of them used to work at said banks.

[Narradisall]

No.

Imo they have ben running their companies terribly and wastage has been huge. They do employ a lot of people but are not a key industry (although I think the banks should have sunk or swam too).

I don't think the US car industry has changed much in the last few decades, and in the modern market you can't just sit on your hands a say 'buy American' when you offer little real incentive.

[Raen]

Maybe instead of giving the billionaires that own these companies a bailout, the federal government should just give each of the workers who become unemployed as a result of this a $100K severance. It would probably be cheaper and maybe then they could afford to pay for the loans the bailed out finance industry should have never given them.

This makes a lot more sense to me honestly than bailing out an industry that may well still fail. Bailing out companies just generally has no effect.

[Wraith]

I think they need to stay alive through the short-term financial bust, and if that means a loan, then it's probably going to be worth it, considering all the jobs involved, both at the big 3 and interconnected industries.

But I don't think anyone believes that this alone will be enough to turn things around for the long term. There's obviously something that Toyota, Honda and the rest are doing that GM, Ford and Chrysler aren't, and it's not just limited to their small car and truck/SUV lineups, though that's part of it.

This is a list of the top 20 best selling vehicles in the U.S. through October 2008:
Following is a list of the top-20 selling vehicles, ranked by total units.
RANK VEHICLE 2008 2007 '07 RANK % Chng
1 Ford F-Series P/U 436,022 588,952 1 -26.0
2 Chevy Silverado-C/K P/U 402,191 526,575 2 -23.6
3 Toyota Camry 386,118 398,868 3 -3.2
4 Honda Accord 333,011 332,815 6 +0.1
5 Toyota Corolla 307,071 317,796 4 -3.4
6 Honda Civic 304,297 278,764 8 +9.2
7 Nissan Altima 241,529 239,800 9 +0.7
8 Chevrolet Impala 231,841 270,504 7 -14.3
9 Dodge Ram P/U 213,684 301,689 5 -29.2
10 Ford Focus 175,958 145,977 15 +20.5
11 Honda CR-V 171,193 184,003 11 -7.0
12 Chevrolet Cobalt 168,940 169,400 14 -0.3
13 Chevrolet Malibu 151,429 108,930 26 +39.0
14 GMC Sierra P/U 145,067 174,621 12 -16.9
15 Toyota Prius 142,365 150,572 16 -5.5
16 Ford Escape 135,558 139,911 17 -3.1
17 Ford Fusion 128,381 123,729 20 +3.8
18 GM Pontiac G6 126,494 121,278 28 +4.3
19 Toyota Tundra 121,451 162,348 23 -25.2
20 Honda Odyssey 121,249 144,718 21 -16.2

I'll probably add more later... but even this year, the big 3 are selling a lot of trucks. It's that Camry-Accord-Corolla-Civic section where they're getting beat the most, though the Malibu-Fusion-Cobalt-Focus are still in the top 20.

[Mr. Murphy]

Nay, because it appears that the auto industry failed not because of the economic problems, but because they refuse to modify their business model to fit the current day and age.

In other words, their problems are their own fault - after all, cars are pretty important, right behind housing for a lot of people. Their problems aren't because nobody is buying cars, but because people are choosing foreign vehicles over American, and that's because of their own business choices.

That's how it appears to me, anyway.

[Ancalagon]

Interesting thought experiment - whats the difference between Big Content (ie RIAA and MPAA) and the automotive industry?

I think the difference is that Big Content has cleverly got the government on its side.

[itchyeyes]

I vote nay.

It's not an issue of the current market climate, and it's not an issue of sales. As Wraith pointed out US autos still sell in large quantities. In 2007 GM brought in 50% more revenue than Honda. Yet while Honda turned a $6.5 billion profit, GM lost nearly $40 billion. It's an issue of costs, and not just in terms of UAW compensation. At nearly every level these companies are grossly mismanaged, something that in some part can be attributed to previous bailouts of the industry.

The current state of Ford and GM has nothing to do with the current economics downturn. These collapses have been coming for nearly a decade. They add no real value to the US economy as demonstrated by their financial losses over the the last several years. Yes, auto workers will be hurt, but given that they share a good portion of the responsibility for these companies financial insolvency I have little sympathy. Many foreign auto makers operate plants in the US and there will continue to be jobs available, albeit in much lower quantities for the near future at least..

The only legitimate reason I can see for US tax-payers shouldering the burden of the companies yet again is if their collapse will exacerbate the current recession to unacceptable levels. Of course you also have to weigh that against the even further debt the federal government has to withdraw in order to support these bailouts. Personally, I feel that the pros of bailing out these companies simply do not outweigh the cons.

[itchyeyes]

Interesting thought experiment - whats the difference between Big Content (ie RIAA and MPAA) and the automotive industry?

I think the difference is that Big Content has cleverly got the government on its side.
Well one key difference is that the issues facing big content are very much dependent on how the government defines property laws. So regardless of which way it goes, it's still very much in the realm of the governments responsibility to determine those laws. The auto makers however are facing no such issues. Their problems arise almost entirely from the free market. Government action here is an intervention in the working of the free market. Not only do they need to justify that such intervention is necessary, but also why it applies specially to these companies as opposed to others. It is not government's place to pick and choose what companies deserve to be successful and what companies don't. If they're going to intervene they have to have some other reason that shows that it's in the public's interest to do so.

[Ancalagon]

Well one key difference is that the issues facing big content are very much dependent on how the government defines property laws. So regardless of which way it goes, it's still very much in the realm of the governments responsibility to determine those laws. The auto makers however are facing no such issues. Their problems arise almost entirely from the free market. Government action here is an intervention in the working of the free market. Not only do they need to justify that such intervention is necessary, but also why it applies specially to these companies as opposed to others. It is not government's place to pick and choose what companies deserve to be successful and what companies don't. If they're going to intervene they have to have some other reason that shows that it's in the public's interest to do so.

True, but when the RIAA and MPAA attempt to define how the government defines property laws, it all gets a bit confusing.

I'd say, in both cases, companies are wanting intervention from the government to help them deal with pressures in the free market that they are ill equipped to deal with.

[Wraith]

The current state of Ford and GM has nothing to do with the current economics downturn. These collapses have been coming for nearly a decade. They add no real value to the US economy as demonstrated by their financial losses over the the last several years. Yes, auto workers will be hurt, but given that they share a good portion of the responsibility for these companies financial insolvency I have little sympathy. Many foreign auto makers operate plants in the US and there will continue to be jobs available, albeit in much lower quantities for the near future at least..I think the current economic downturn exacerbated an already bad situation. Yes, they were in trouble long before this, but would they be begging for a bailout now if the economy hadn't taken a nosedive? If there wasn't a credit crunch? If gas prices hadn't seen such a huge fluctuation in the last couple years?

[diablopath]

Just as a note, plenty of people are denied an organ transplant because they are too sick or lead a poor lifestyle. So, if applicable, I'm not sure your hypothetical is really a supportive argument.

I mean, the U.S. auto industry has already proved it will stand in the way of the consumer demand and that it doesn’t have a viable business model. If we give them money now, you stifle the chance for other companies to spring up by holding the current failures above water. What happens if the car companies fail again, and again? It sounds as though you think we should just keep handing them money because, “Oh, hey, they’re too big to fail!”

So, I ask again: if not now, where and when does it end?

Y'know, I'll retract my last statement.
I know that they really don't deserve the money. They are failing horribly because they failed to keep up with the times. Detroit has always been stubborn to change its ways (better vehicles with better fuel economy, etc etc etc).
I'm not defending the car companies at all, I hate their business practices. I just don't like the idea that so many people are going to suffer while the people who made those decisions already have enough money to fall back on for the rest of their lives. That really bothers me.

I guess there aren't any real good solutions here, though.

[Ancalagon]

Y'know, I'll retract my last statement.
I know that they really don't deserve the money. They are failing horribly because they failed to keep up with the times. Detroit has always been stubborn to change its ways (better vehicles with better fuel economy, etc etc etc).
I'm not defending the car companies at all, I hate their business practices. I just don't like the idea that so many people are going to suffer while the people who made those decisions already have enough money to fall back on for the rest of their lives. That really bothers me.

I guess there aren't any real good solutions here, though.

Its like a mass murderer telling you to give him all the guns he wants or he will blow 500 people away. You know that giving him the guns is wrong, but you also know that letting 500 people die is wrong. You just wish he would learn to stop being a mass murderer.

[Mr. Murphy]

Y'know, I'll retract my last statement.
I know that they really don't deserve the money. They are failing horribly because they failed to keep up with the times. Detroit has always been stubborn to change its ways (better vehicles with better fuel economy, etc etc etc).
I'm not defending the car companies at all, I hate their business practices. I just don't like the idea that so many people are going to suffer while the people who made those decisions already have enough money to fall back on for the rest of their lives. That really bothers me.

I guess there aren't any real good solutions here, though.

It is unfortunate how this affects the average auto worker, but bailing out the companies would only be a temporary solution if they don't have a viable business model.

[itchyeyes]

but would they be begging for a bailout now if the economy hadn't taken a nosedive? If there wasn't a credit crunch? If gas prices hadn't seen such a huge fluctuation in the last couple years?
I seriously think so. GM hasn't had a profitable year since 2004. The credit crunch, housing crisis, and surge in oil prices are all events that happened in the last two years, and some of them in the last 12-18 months. The company was already losing money hand over fist before everything went to hell. The current financial crisis may have accelerated things, but it was only a matter of time before GM came to the federal govt hat in hand looking for a handout.

This isn't the first time these companies have looked to govt to keep them afloat, and it won't be the last if we bail them out this time.

[Wraith]

It is unfortunate how this affects the average auto worker, but bailing out the companies would only be a temporary solution if they don't have a viable business model.On the other hand, if they don't get a temporary fix, will they fail regardless of whether they have a viable business model going forward?

There are a few things on the way that show the big 3 are trying to adapt.

Ford Fusion Hybrid
Saturn VUE Plug-in Hybrid
Chevy Volt
Building fewer trucks, more small cars (http://www.autobloggreen.com/2008/11/26/big-shift-ford-plant-produced-last-truck-today-will-start-maki/)
Chevy Cruze (Cobalt replacement with turbo 1.4L engine expected to get 40+ MPG hwy)
Bringing efficient European models to the States (http://www.autobloggreen.com/2008/09/24/ford-to-bring-six-fuel-efficient-european-models-stateside/)
Investment in hybrids, electric, and fuel cell technology


*Edit* Even going so far as to apologize (http://www.autobloggreen.com/2008/12/08/gm-apologizes-for-betraying-american-consumers-focusing-on-ga/).

[Mr. Murphy]

On the other hand, if they don't get a temporary fix, will they fail regardless of whether they have a viable business model going forward?.

That is a good point. Thanks for the links!

[itchyeyes]

On the other hand, if they don't get a temporary fix, will they fail regardless of whether they have a viable business model going forward?

There are a few things on the way that show the big 3 are trying to adapt.

Ford Fusion Hybrid
Saturn VUE Plug-in Hybrid
Chevy Volt
Building fewer trucks, more small cars (http://www.autobloggreen.com/2008/11/26/big-shift-ford-plant-produced-last-truck-today-will-start-maki/)
Chevy Cruze (Cobalt replacement with turbo 1.4L engine expected to get 40+ MPG hwy)
Bringing efficient European models to the States (http://www.autobloggreen.com/2008/09/24/ford-to-bring-six-fuel-efficient-european-models-stateside/)
Investment in hybrids, electric, and fuel cell technology


*Edit* Even going so far as to apologize (http://www.autobloggreen.com/2008/12/08/gm-apologizes-for-betraying-american-consumers-focusing-on-ga/).
People make a big deal out of Ford and GM's late arrival to the fuel efficient vehicle party. I think that point is way oversold, though. For starters hybrids have only become really big sellers in the last year or two. And even this year, with gas prices at their highest in decades, the Prius is the only hybrid to crack the top 20 selling vehicles at #15 on Wraith's list. Also take into account that even if the big 3 missed a big opportunity on hybrids they were raking in money hand over fist with SUV's and big trucks when gas prices were low while foreign auto makers were missing out.

Also, consider that with gas back at $1.50/gal many of these late moves to adopt fuel efficient vehicles may backfire on these companies as consumers re-evaluate just how much an extra 10-20mpg is really worth.

Like I said before, I really don't think that the problems with the big 3 stem from lack of sales. It's a cost issue. Their vehicles simply cost too much to make compared to their competitors. These are companies that were struggling to stay competitive when oil prices were still at $20/bbl. So while hybrids have a lot of play in terms of public perception, I'm very skeptical of just how much of an impact they're really had on the companies' bottom lines compared to other factors here.

[bean]

People make a big deal out of Ford and GM's late arrival to the fuel efficient vehicle party. I think that point is way oversold, though. For starters hybrids have only become really big sellers in the last year or two. And even this year, with gas prices at their highest in decades, the Prius is the only hybrid to crack the top 20 selling vehicles at #15 on Wraith's list.
Isn't the reason that hybrids have only recently become big-sellers that they only made very limited amounts of them until recently. The people I know who own a hybrid had to wait on a list for it for six months while also paying a premium for the car due to it's low availability.

Instead of making and marketing ridiculous Ford F-350's, maybe they should have gotten back to their roots and designed the first highly affordable hybrids.

In England, they have these little electric cars that are only used for getting about town. They are tiny and are about the speed of a scooter or high-performance golf cart (35-40 mph). If I could get one of these for $5K (or less), it would suit my needs. For distance travel, I fly, and while it would take me 30 minutes taking the access roads to get into the large town of which my little college town is a suburb (instead of 15 minutes), I only have to get up there on rare occasions. If they engineered this to be a bit larger (size of a Volkswagon Bug), I think this would be a great primary town car for a lot of people.

Ranchers, farmers, construction workers, etc. actually NEED trucks, so we'd still see a lot of them around this area in Texas, but I think a lot of people would choose to use energy efficient cars if they were relatively inexpensive.

[Generation ABXY]

I agree with this. Its ironic that the government bends over backwards to help the banks after they screw up, but are dubious about helping the auto makers. How about demanding the banks give up their private jets and holidays? Oh wait, you wont do that since many of them used to work at said banks.

Well, we also have to remember that the government is at least partly responsible for the housing crisis, which is one of the biggest factors in our economic tailspin. People like to say we need more regulation on these loans, but a regulator has no power when the government they are reporting to is mandating that loans be giving to people who didn’t deserve one.

Did the banks get carried away with it? Perhaps, but I’m not really surprised considering these loans had some sort of backing and there was a swell of idiotic congratulations that swept them all up.

“You managed to get a house for someone who didn’t have the down payment, credit or a job? You’re a pillar of the community, young man; let’s go make a press statement!”

Again, that doesn’t absolve the banks of all wrongdoing and their failure runs much deeper, I’m just pointing at through GSEs and the like, the government did have a hand in it. While I don’t support that bailout either – especially after seeing what became of it – I can at least look at it as the government trying to right some of its wrongs.

[Stmfuller]

I'm from michigan and killing the big three kills the state.
I'd like to go back someday...so please do let them die.

That being said, I disagree in principle to the bailouts as a whole...so as you can see, I'm a little torn by this.