General Motors (NYSE: GM) and Ford (NYSE: F) want you to pick up their tab for their decades of excess and managerial incompetence.
The Associated Press reports that the Detroit automakers are likely to ask Congress for $50 billion in low-interest loans to fund modernization efforts, and help them build more fuel-efficient vehicles.
What a load of crap. In 2007, Ford paid cash-burning CEO Alan Mulally $21 million, and GM's Richard Wagoner got a 41% raise to over $14 million for the same year. In effect, our tax dollars will be subsidizing this pay for pulse orgy of bad governance. GM also paid out more than half a billion in dividends in 2007 -- if the company needs billions to invest in modernization, why didn't it cut the dividend a long time ago?
It appears that the auto industry has been counting on a bailout all along, and why not? It looks like they'll be getting it.











Reader Comments (Page 1 of 2)
8-24-2008 @ 8:32AM
Joe said...
A Load of crap? Americans's in general have lost their ability for critical thinking.
American bashers couldn't find anything good to say about an Ameican automaker if you paid them. Were the auto makers responsible for not being able to see $4.00 gas? or even $2.00 gas.
Look to Washington for the source of the problems, not Detroit!
These guys have right idea, put all the Americans out of business and watch our economy sink even further into oblivion.
Do you think the writer can understand the concept of " enlighteded self interest"?
8-24-2008 @ 9:06AM
sonnype said...
Congress seems to have no problem bailing out greedy bankers whom almost destroyed our financial system with thei greed and helping home owners who bought more expensive houses than they could afford.Congress approves billions to rebuild Iraq while that country has billions in oil revenue that draws interest .So I dont see why my tax dollars should`nt be used to make loans to the automakers after all its loans and not a hand out as in trhe cases of the banks and Iraq .To me it makes sense to save American jobs for once instead of sending them overseas
8-24-2008 @ 10:06AM
PHIL said...
WELL ZAC WE HAVE HAD HOW MANY WELFARE BAILOUTS OF THE FINANICALS ? LOL LOL WITH IDIOTS LIKE YOU WHO DON'T SEE BANKS DON'T HAVE ANY MONEY ! WALL STREET IS BROKE AND FAILING FASTER THAN ANY OF THE BIG THREE.. WHAT WE DON'T HAVE ANY WALL STREET CODE WORDS? LIKE WRITEDOWNS FOR WALL STREET BANKS THAT LOSE BILLIONS PER QTR! OR WHEN THE DOW DROPS 300 PTS ITS CALLED A CORRECTION ! lol ANOTHER ANAL-YST! HAH!
8-24-2008 @ 10:16AM
PHIL said...
AND YOU WRITE THIS?their decades of excess and managerial incompetence.
WELL WHAT ABOUT ALL THE HOME LOANS FROM THE WALL STREET BANKS WITH NO CREDIT CKs AND NO EMPLOYMENT CKs AND NO SS#s WHAT ABOUT THAT ? "THATS INCOMPETENCE" ! AND NOW THE FEDS AND FDIC ARE GIVING WELFARE WALL STTREET BANKS BAILOUT AFTER BAILOUT ! AND LETS NOT FORGET THE SAVINGS AND LOAN FAILURES OF THE 90's FROM ANOTHER BUSH CALLED NEAL! ... DAAAAA ! NO WONDER THE BIG THREE CAN'T GET LOANS ! THE BANKS HAVE NO MONEY SO THEY HAVE TO GO TO CONGRESS FOR LOW INTREST LOANS ! NOT A BAILOUT LIKE THE BANKS.. I DON'T SEE THEM PAYING BACK ANYTHING!!
8-24-2008 @ 10:44AM
PHIL said...
OH ZAC ONE MORE THING ? WHY IS IT WHEN A REPUBLICAN CONSERVATIVE LIKE YOU, HAS NO PROBLEM WITH TAXPAYERS PAYING 6.2 TRILLION TAXPAYER DOLLARS, BORROWED FROM COMMUNIST CHINA FOR TWO WARS / OCCUPATION AND CALL THAT FREEDOM ? BUT TRY TO SPEND JUST HALF THAT ON A NATIONAL HEALTHCARE PROGRAM FOR AMERICANS ? AND GET HEALTHCARE OFF THE BACKS OF AMERICAN COMPANIES LIKE THE REST OF THE WORLD DOES! THE SAME CONSERVATIVE REPUBLICANS LIKE YOU, RUSH,HANNITY AND THE FOX NEWS CREW lol lol "MORE ANAL-YST"!! CALL THAT COMMUNISM / SOCIALISM !WHY! ASK THE NEXT REPUBLICAN THAT QUESTION ?
8-24-2008 @ 10:58AM
Connie said...
Why not bail them out? Congress seems to like bailing out big businesses! Why not let wagoner write their bail out package like they let the bankers write their bail out package? And while they're at it why not send a couple more billion to third world countries? The US taxpayers have money trees growing in their back yard! But by ALL MEANS DO NOT GIVE US AN ENERGY BILL!
8-24-2008 @ 11:21AM
Hankster said...
Let's remember that Ford and GM are only losing money in North America. Buick is a hot selling brand in China, and Ford owns the British car market. Other than in North America they are making money. They are in trouble here because of their blind reliance on large SUVs and pick-ups on which they earned from 10k up profit, while cars only earned a few hundred. They, and the unions successfully fought CAFE standards since Reagan took office, and now their chickens have come home to roost. They rail constantly about the "free market, let the market decide, get gov't off the backs of business, no regulations", etc. until they get in trouble. Now, we need to do this for "the greater good." Please! They couldn't see higher oil prices coming? Please!
8-24-2008 @ 12:01PM
PHIL said...
HANK , YOU MAKE A GREAT POINT ? BUT ONLY ON THING IS WRONG . MOST OF THE CARS THEY PRODUCE IN EUROPE CANNOT PASS THE FMVSS SAFTY STANDARDS FOR CRASH TESTS IN THIS COUNTRY ! BUT LIKE REAGAN I LOVE IT WHEN CONGRESS GIVES TO AMERICAN COMPANIES , STATES AND CITIES "UNFUNDED MANDATES"!! AND I DO MEAN "UNFUNDED" !! IF THE CONGRESS MAKES A LAW THAT PUTS "UNFUNDED COSTS", ON STATES , CITIES AND AMERICAN COMPANIES !! WELL I CAN SEE WHEN REAGAN WAS PREZ WE PAID $900 FOR A HAMMER!! SO TAKE A GOOD LOOK ! lol
8-25-2008 @ 5:53AM
Gus Reifenkugel said...
You are all wrong. The big rollover is coming no later that 2009, perhaps sooner. The dollar is toast and both demos and repubs are responsible. Their only interest is reelection; not you; not me; not our childrens future. Only themselves.We the voters are responsible. They play us for the suckers we are.
8-24-2008 @ 12:25PM
Larry said...
Fine, if the Government does give a loan guarantee to the auto companies, let them mandate what type of car they can make and sell. Like 50 mpg for a car, 40 for a pickup truck, no SUV's at all this type of vehicle is not needed. Also the companies will have to go forward in research for a electric to be produced by 2010 no later. This will also pretain to any car sold in the USA. Now if these companies want to produce a limited production high horsepower cars they can as long as no more that 1000 limited production cars are produced per year per company line. Also cut the pay for the top people in these companies, no one needs to make over 1,000,000 per year.
8-24-2008 @ 1:35PM
cal said...
It is immature to think that the government can bail out the automakers, but if we try, we need to default on the interest payments Fannie and Freddie are paying against the outstanding loans to China and the Arabs. That is who the tax payers are bailing out, the Chinese and the Arabs, without the Feds being upfront about wher the necessary funds are going. I believe we need to go into a 5 year freeze on our outstanding debt to these folks to give us time to revamp. And stop playing this default game month by month.
8-24-2008 @ 3:53PM
MAtt said...
You are correct. Do not grant the companies the loans, and inevitably they will face bankruptcy because they can not operate efficently. Now, how many people will be hurt by the Hundreds of millions.. NO BILLIONS of dollars in write off's due to a Bankruptcy? Will destroy the economy more than could be imagined. GM is the largest US Conglomerate, it going bankrupt wiuld be detrimental to the economy. The Govt bailed the airlines out, why not automakers?
8-25-2008 @ 6:08AM
Don said...
They are not asking for a hand out. They are asking for a loan! In a way, our government is at fault for allowing the Japanese into this country knowing that they did not even have one person that they had to pay a pension to. While, GM on the other hand had to pay for over half a million retirees. Just that in itself was enough for GM to try to jump out of the hoop and by doing so quality suffered. GM and the UAW have made many positive changes (wages cut in half) and if given a chance, they will go back to their glory days.
8-24-2008 @ 6:30PM
Chris said...
At the beginning of 2006, the Big 3 automakers directly employed 377,000 people – or 8 out of 10 US auto workers. Another 7.2 million jobs - including dealers, suppliers – are tied to the US automakers. Last year, the Big 3 spent $21 billion in the United States on research and development. More than three-quarters of a million people rely on the Big 3 for retirement, pension and health benefits. (http://www.house.gov/dingell/documents/press_releases/109th_Session2/08-21-06.htm)
My point is.... millions of Americans are involved in the auto industry and don't work directly for any of the Big Three. The trickle down effect that the Big Three has on the economy cannot be denied. If taxpayers are going to give out low interest loans, then this might be the best instance to do it.
8-24-2008 @ 9:33PM
PHIL said...
thought this was interesting.
1. Which country can boast that their brands occupy 2 of the
top 3 spots for long-term reliability?
a. Germany
b. Japan
c. Korea
d. United States
2. As of August 2007, which manufacturer had the most recalled
vehicles in the U.S. for that year?
a. Chrysler
b. Ford
c. GM
d. Nissan
e. Toyota
f. Volkswagen
3. Pick the brand from each group that has the highest initial
quality.
a. Acura, BMW, Cadillac (all luxury makes)
b. Honda, Mercury, Nissan (all non-luxury makes)
c. Acura (lux), Chevrolet (non-lux), BMW (lux), Mazda (non-lux)
4. Which midsize sedan has the highest initial quality?
a. Accord (Honda)
b. Altima (Nissan)
c. Camry (Toyota)
d. Malibu (Chevrolet)
5. Which large sedan has the highest initial quality?
a. Avalon (Toyota)
b. Grand Prix (Pontiac)
c. Sable (Mercury)
6. Which midsize pickup has the highest initial quality?
a. Dakota (Dodge)
b. Ranger (Ford)
c. Tacoma (Toyota)
7. Which car is the most economical overall?
a. Aveo (Chevrolet)
b. Fit (Honda)
c. Prius (Toyota)
8. Which car did the LA Times describe as a better car than
BMW or Mercedes or Lexus or Infiniti?
a. A6 (Audi)
b. CTS (Cadillac)
c. RL (Acura)
9. Which company makes the winner of the 2008 Green Car of the
Year award?
a. Chevrolet
b. Honda
c. Toyota
10. Which car was selected by the North American automotive press
corps as the North American Car of the Year for 2007?
a. Aura (Saturn)
b. Camry (Toyota)
c. Fit (Honda)
11. Which car won the same award for 2008?
a. Accord (Honda)
b. Altima coupe (Nissan)
c. Malibu (Chevrolet)
12. Which company had a luxury vehicle, a midsize sedan, and a large
truck removed from the Consumer Reports recommended vehicles list in
October 2007 because of mounting quality problems?
a. Chrysler
b. Ford
c. General Motors
d. Hyundai
e. Toyota
f. Volkswagen
ANSWERS:
1. Which country can boast that their brands occupy 2 of the top 3
spots for long-term reliability?
Answer: United States.
Per J.D. Power Vehicle Dependability Study, Mercury and Cadillac are
in the top 3, along with Lexus. And in 2007, Buick was tied with Lexus
for the top spot.
http://www.jdpower.com/corporate/news/releases/pressrelease.aspx?ID=2...
2. As of August 2007, which manufacturer had the most recalled
vehicles in the U.S. for that year?
Answer: Volkswagen.
According to Business Week, Volkswagen had the most recalls at this
time a year ago. The second worst was Toyota.
http://www.businessweek.com/autos/content/aug2007/bw20070810_455098.htm
3. Pick the brand from each group that has the highest initial
quality.
a. Answer : Cadillac (better than both Acura and BMW)
b. Answer: Mercury (better than both Honda and Nissan)
c. Answer: Chevrolet (better than Acura, BMW, and Mazda)
This is according to J.D. Powers Initial Quality Survey.
http://www.jdpower.com/corporate/news/releases/pressrelease.aspx?ID=2...
4. Which midsize sedan has the highest initial quality?
Answer: The Chevrolet Malibu has better initial quality than any
competitor, including the Honda Accord, Toyota Camry and Nissan
Altima. The Ford Fusion also beat all 3 Japanese competitors.
This too is from the J.D. Power Initial Quality Survey, which also
reveals that above average are American brands Mercury, Ford,
Cadillac, Chevrolet , Pontiac, Lincoln, and Buick. Below average are
import brands Acura, Kia, Nissan, BMW, Mazda, VW, Subaru, and Scion
(and several others).
http://www.jdpower.com/autos/articles/2008-Initial-Quality:-Midsize-a...
http://www.jdpower.com/corporate/news/releases/pressrelease.aspx?ID=2...
5. Which large sedan has the highest initial quality?
Answer: Again per J.D. Power, the highest quality large car is the
Pontiac Grand Prix, beating the Toyota Avalon. Two other Detroit cars
that beat the Avalon are the Mercury Sable and Mercury Grand Marquis.
http://www.jdpower.com/autos/articles/2008-Initial-Quality:-Midsize-a...
6. Which midsize pickup has the highest initial quality?
Answer: The Dodge Dakota has the best quality for midsize pickups,
proving that Chrysler too can beat the imports. Both the Dakota and
the Ford Ranger beat the Toyota Tacoma.
http://www.jdpower.com/autos/articles/2008-Initial-Quality:-Pickups-a...
7. Which car is the most economical overall?
Answer: Per Edmunds.com, the premier automotive analysis site, the
most economical car in America, taking into account not only mileage
but all costs, is the Chevrolet Aveo. The Honda Fit is #3 and the
Toyota Prius is a distant #34.
http://www.edmunds.com/help/about/press/127806/article.html
8. Which car did the Los Angeles Times describe as a better car
than BMW or Mercedes or Lexus or Infiniti?
Answer: Cadillac makes a better car than BMW or Mercedes or Lexus or
Infiniti, and that car is the 2008 CTS. No other car in the mass
market dares so much as this expressive and audacious bit of
automotive avant-gardism. Dan Neil, LA Times.
http://www.latimes.com/classified/automotive/highway1/la-hy-neil12dec...
9. Which company makes the winner of the 2008 Green Car of the Year
award?
Answer: The Chevrolet Tahoe Hybrid is the winner of this award. How
could a full-size SUV defeat the media darling Toyota Prius? Read the
link below and you will discover, Whats equally eye-opening is that
the Tahoes 21 mpg city fuel efficiency rating is the same as that of
the city EPA rating for the four-cylinder Toyota Camry sedan.
Did you catch that? A huge, full-size SUV from Chevrolet that gets
the same city mileage as a 4-cylinder Toyota Camry!! Chevy obtained
this remarkable achievement through the use of its 2-mode hybrid
system, a technology that Toyota does not have.
http://www.greencar.com/features/2008greencar/
10. Which car was selected by the North American automotive press
corps as the North American Car of the Year for 2007?
Answer: Not only was the Saturn Aura picked by the automotive press
corps as better than the Honda Fit and the Toyota Camry, When a panel
of 47 journalists named the Saturn Aura the North American Car of the
Year over the Toyota Camry, the vote wasn't even close, 205-89.
Chicago Tribune, 1/15/07
http://www.northamericancaroftheyear.org/news.html
11. Which car won the same award for 2008?
Answer: GM again crushed the Japanese competition in 2008 when the
Malibu received 190 votes to the Honda Accords 95. The Accord
actually came in 3rd since GMs other finalist, the Cadillac CTS,
received 165 votes.
http://www.northamericancaroftheyear.org/news.html
12. Which company had a luxury vehicle, a midsize sedan, and a large
truck removed from the Consumer Reports recommended vehicles list in
October 2007 because of mounting quality problems?
Answer: Toyotas much publicized quality problems resulted in
Consumer Reports actually removing from their recommended vehicles
list the Lexus GS luxury car, Camry V6 sedan, and Tundra pickup. This
demotion occurred in October 2007.
If you are one of the many Americans who gave up on Detroits cars
because of a bad experience many years ago, its time to rethink your
position. Rethink Detroit.
Detroit automakers: 79 U.S. jobs per 2,500 cars sold in America.
Foreign automakers: 33 U.S. jobs per 2,500 cars sold in America.
http://levelfieldinstitute.org/
"NUFF SAID" IDIOTS...
8-25-2008 @ 7:30AM
javier said...
Since it will happen anyway, why not make the tax payers, who are really bailing them out, a shareholder who will be eligble for dividens
8-25-2008 @ 9:36AM
jpdr1100 said...
Joe, yes, Detroit should be held responsible for not foreseeing expensive gas. the rest of the industry seems to be able to accept the change and adjust, why can't Detroit?
As for them only asking for a "loan:" BS. They are asking for low interest loans than no bank would give them. Too much risk. So they are asking we taxpayers to take the risk for them.
8-25-2008 @ 10:47AM
Bruce Hall said...
1. The Japanese and Korean automakers have protected home markets. Just try to sell U.S. cars there. A reciprocal "agreement" would kill the auto industries in those nations.
2. Rather than relying on market forces, the government relies on forcing markets... not at the expense of the government.
3. The U.S. auto industry... particularly Ford... has vehicles that equal Toyota and approximate Honda in quality.
4. Where were those customers clamoring or itsy-bitsy cars just 5 years ago? Why did Toyota create the "Tundra" and "Highlander"?
If our next President, Obama, wants to mandate specific product mix by a specific time, then our government should be willing to be an "enabler" rather than a burden on our auto industry.
8-26-2008 @ 1:07PM
Rajesh said...
If America believes in equality then Fredie,Fannie, bear stern, GM, Ford , Chrysler should be treated equally period.
8-27-2008 @ 11:56PM
Dave said...
Maybe the real concern is...getting people to go to the gym more often so we can cram American's fat asses into smaller cars! Ever think the weight of a average American family has gone up 500 pounds over the past 5 years? Just think shedding 500 lbs could get you an extra 3-5 gallons per mile!