General Motors Corp. and Chrysler LLC told the federal government they need at least $21.6 billion more combined in bailout loans to put them on the road to recovery, and outlined possible scenarios if either auto maker should have to file for bankruptcy protection.
Both GM and Chrysler, in the recovery plans submitted Tuesday to the U.S. Treasury, argue that bankruptcy would be more costly and drawn out than government-funded restructurings.
GM said it might need as much as $100 billion in financing from the government if it were to go through the traditional bankruptcy process. Rick Wagoner, GM’s chairman and chief executive, said the bankruptcy scenarios are “risky” and “costly” and would only be pursued as a last resort.
Chrysler’s plan said the company would likely have to file for Chapter 11 protection if it doesn’t get additional loans from the government and concessions from unions, creditors and dealers. It said it would need $24 billion in financing if the company were to file for bankruptcy. But company officials said in a conference call that they believe a Chapter 11 filing is “not necessary” for Chrysler’s survival.
As if that wasn’t enough, they are now also asking the swedish government to bailout SAAB (which is owned by GM but based in sweden).
Doesn’t almost every country heavily subsidize their automotive industry?
#2
NO
———
and if you were going for “everyone else is doing it” logic you might consider thinking instead.
#1: So GM ruined Saab? I think not. They’ve always been a quirky company (except for the jets) and have been going downhill since Erik Carlsson retired.
Can you say “Bottomless Pit?” Sagan-esque “Billions and Billions” will never be enough.
And, remind me…what is it we’re getting for our money? UAW clinging on to bloated obsolete jobs for another year is my guess.
Okay I don’t get this. If your REALLY for saving these companies capping executive compensation is not the answer. It’s firing everyone involved in any executive decision maker. CEO & Board members. They’ve all milked the by playing fraudulent number games.
Bloated obsolete jobs?
Why are people so ignorant about unions and worker’s wages?
Maybe if the execs took less pay, paid their workers better, kept jobs in the country… THEN MAYBE PEOPLE COULD FUCKING AFFORD TO BUY SOME SHIT!!!
As a taxpaying citizen of the United States, I now consider myself to be, essentially, a shareholder in General Motors.
GM and UAW, don’t fuck this up for us. You’d better start making quality cars that people will BUY. Not the shit that you’ve been making for the last 20 years.
And a message to the UAW: stop screwing around. I blame you 100% for the US auto industry being in this mess. I’m not giving you another fucking dime.
# 7 Troublemaker said, “Maybe if the execs took less pay, paid their workers better, kept jobs in the country…”
Companies go to where it is advantageous, for HQ AND labor. So, the gov’t can hand wring all it wants. If it doesn’t do something to create an environment that is attractive, all jobs will go bye, bye…
8,
You can consider yourself a shareholder of GM, but you’re not. In fact, if you try and stake that claim you’ll be arrested, charged, convicted and then possibly tortured.
GM, Ford, maybe. Chrysler, no. Let’s see what Cerberus Capital says…
“Cerberus Capital Management, L.P. is one of the world’s leading private investment firms. Cerberus specializes in providing both financial resources and operational expertise to help transform undervalued companies into industry leaders for long-term success and value creation.
Cerberus is headquartered in New York City with affiliate and/or advisory offices in Atlanta, Chicago, Los Angeles, London, Baarn, Frankfurt, Hong Kong, Tokyo, Beijing, Osaka, Taipei and Dubai.
Cerberus holds controlling or significant minority interests in companies around the world. In aggregate, these companies currently generate over $100 billion in annual revenues.”
100 Billion in annual revenues? I think they can manage themselves…
9,
So, why did Halliburton go to Dubai? Good labour there?
#1-Actually, GM wants sweden to buy saab. if not, then they are gonna discontinue it. But remember the facts here-if you let GM and Chrysler go under, that turns a 30-50billion problem for the taxpayers into a 120-150billion pension problem for taxpayers. Because the first second after a bankruptcy filing, both companies will pass on the pension obligations to the PBGC, which is a much more expensive proposition. And the loss of both of these companies then takes out approx. 8million vehicles out of the global market. How is ToyHonSan going to flip a switch and make up that loss of vehicles? Law of supply and demand says that will make the prices of their ‘cheaper’ cars go up then, which affects everyone.
#2- They do subsidize them when they are in trouble. Only countries not on board with helping their auto industry that Im aware of is Japan (yet) and U.S. Remember, these other countries gave money to their automakers, like we did with the banks. U.S. has given just loans. GM and Chrysler must pay this money back with interest (unless a bankruptcy filing happens, but thats another issue for another day).
On a personal note, I do work for GM. And I will say that all of this doom and gloom talk is beginning to wear on all of us at the company. We are striving every day to cut costs and make the best products in the world. Me personally would like this ordeal to just be over. Bankruptcy or not, turning on the news every day, and every discussion with everyone you know always beginning with ‘You guys gonna go out of business?’ is really getting old. I hope none of you have this happen to your company, because honestly, it sucks. Just my 2 cents worth, and please, dont beat me up too bad….hehehe
# 11 Named said, “So, why did Halliburton go to Dubai? Good labour there?”
Tons of cheap Indian labor there. Lax labor laws. You didn’t know that?
13,
What the hell does the HQ have to do with cheap labour? In case didn’t notice, it wasn’t the plant that moved, but the HQ. You know… white collars.
As for Indian labour, i know that Dubai just exported 80000 of them due to lack of work.
# 14 Named said, “What the hell does the HQ have to do with cheap labour?”
Nothing. YOU asked about labor conditions there. Why did you want to know?
Let them go bankrupt so they restructure. There is a lot of over capacity in the industry and they are going to have to shrink in size no matter how painful it is.
15,
Ah. Sometimes you’re too direct. My sarcastic comment was in response to your comments that corps move due to HQ AND Labour. In this case, labour has nothing to do with it but the benefit of getting tax dollars for contracts from the US without having to pay it back in the form of taxes contradicts the AND operator in your comment.
As CEO, I expect you to know that.
# 17 Named said, “My sarcastic comment was in response to your comments that corps move due to HQ AND Labour.”
A corps HQ & manufacturing/labor can be in 2 different areas. The HQ AND workers are both part of the “Corp”.
Get it now?
OK on the union wages thing.. Now if we could find a way so CEO’s, movie actors and sports stars pay was held to reasonable proportions, there might be enough money left in circulation for the rest of us.
Coupons?? – The money has to come from somewhere. There is no such thing as something for nothing.
These companies have a poor business model and are unwilling to change. Either evolve or die.
Don’t throw the money the government will have to borrow at interest after anything that will not be able to pay it back.
Well they gave bailout money to owners of banks(the shareholders got most of the money), so why not for some car companies?
Any agreement should throw out the union contract. The work rules make them less productive, with all the different job categories.
18,
You should have used the AND/OR operator. Now you’re just re-arranging English to suit your purposes. Do YOU get it now?
Any patriotic American will start by only buying from non-UAW automakers. When the union is gone, the first strep to recovery will have been taken.
# 24 Named said, “You should have used the AND/OR operator.”
Naw, anyone familiar with business operations would understand.
Do they have major corps in the country you live in?
26,
One of the most interesting things about English is that it does lend itself well to ambiguities. When you’re trying to prove a point you need specifics. Well WRITTEN specifics. I can’t see you in your moms basement shaking the mouse in anger as you telepathically fill in the blanks and shouting at the screen that the RAGU is almost finished.
We have well managed major corps in fact. As CEO of the larder, I expect you to know your competition.
25,
Just because the UAW fights for improving wages and conditions for their workers means they hate America. Question: Would you like to have the benefits and wages of a UAW member? If yes, STFU.
I don’t get it. Won’t foreign countries simply introduce oppressive duties on the import of cars from government-subsidized (bailout) industries in the same way the US introduced industry-killing duties on Canadian softwood imports when they determined that artificially lowering stumpage fees was a de facto government subsidy to the Canadian forest industry? (Nice run-on question.)
Or are these car bailout subsidies in fact a form of stock purchase? Even so, it would have to be at market rate to be legit.
RBG
# 27 Named said, “We have well managed major corps in fact.”
Really? What country?
29,
Soviet Cannuckistan. Number 1 in banking now.
# 30 Named said, “Soviet Cannuckistan.”
That’s where I figured you were from…
No.
Seems to me we are making a critical error in all this bailout business. Reminds me of nurse training in a hospital re the care of patients.
When a patient is falling, the goal is NOT to prevent that fall but rather to help guide the patient safely to the floor. This applies to most other areas of human endeavor. Gravity Exists. Ignoring reality creates more harm–to the nurse, to the patient. Instead, guide the inevitable to a softer landing and write an order for the patient to be restrained to bed, perhaps with a sedative drip.