Imagine Rick Wagoner, Alan Mulally and Bob Nardelli’s displeasure when they open this morning’s Detroit News and read the “Government May Delay Auto Money.” While you’d hope The Big 2.8’s CEOs knew this before now, it’s still pretty sobering stuff. “We have significant doubts about whether distribution of [$25b worth of federal low-interest] loans by January 2009 is realistic,” Department of Energy (DOE) spokesman Healy Baumgardner warned. “There are a number of legal and administrative requirements with which the Department must comply, such as the National Environmental Policy Act, we anticipate it could take at least 6 to 18 months or more, after necessary funds are appropriated.” Beaumgardener’s remarks unleashed John Dingell’s ire. “It appears that DOE is making excuses for its own anticipated failures,” pronounced the chairman of the House Energy and Commerce Committee. “This is unacceptable; this investment is too important to Michigan for the Department of Energy to drag their feet,” U.S. Rep. Mike Rogers, R-Brighton pronounced. Instead of asking for a federal bailout, Detroit calculated they could alter the DOE “retooling” loans to suit their needs AND get the cash pronto. In this, as in so many other things, they may be entirely, disastrously wrong.
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The only thing they might be able to obtain “pronto” is chapter 11.
The Titanic has hit the iceberg long time ago.Now the question is how deep in the water is she?
Don’t matter the cards have already been dealt. The Big 3 are only the canary in the coal mine and the tidal wave of economic collapse is only starting. This is gonna get a lot worse.
“I’m from the government and I’m here to help you”.
And this, ladies and gents, is why you don’t put your eggs in one basket. It’s called strategy, or at least a backup plan.
(and yes, putting all their eggs into one basket is what put them in mind of a bailout in the first place)
Warning: Dead Horse Beating about to take place.
The government has a bailout plan still available to the automakers. It’s called chapter 11. It’s not as fun and easy as spending hundreds of thousands to lobby congress for tens of millions (Does one ever tire of hopping on the G for golf and thousand dollar dinners with our country’s leaders?), but it’s still a BAILOUT PLAN.
If only they had asked honestly for a bailout instead of this retooling scam. They might have recieved it in time, but that might have meant changes in top management and they couldn’t allow that.
Even if they were to get bailout money they still don’t have the products Americans want to buy. A whole generation of people have grown up using high quality reliable Japanese electronic consumer items. They also have grown up with high quality reliable Japanese automobiles. Why would they want to buy American ?.
There is no more consumer brand loyalty left in American made vehicles anymore, karma has finally caught up with detroit. This is merely the end result of 30 years of producing 2nd rate crap. Bailout or no bailout, the Japanese have caught up and passed the U.S. auto manufacturers, it’s now Detroit who has to play catch up, and they can’t do it because they’re in complete denial.
What basket would you put your eggs in?
The whole of the economy is collapsing and CH 11 won’t help. That just throws the hundreds of thousands of pensioners onto the federal government. Soon people will learn how impotent the government is, Granholm has already shown the way in Michigan. And the sheople voted her back in.
Looks like Ayn Rand got it right. Buy gold.
Where is the USA Death Watch series?
Funny thing that the words uttered years ago will prove true.
“How goes GM so goes the country”
Somehow I never saw this coming. Apparently Congress either a) stupidly believed this wasn’t a bailout and will pay the consequences or b) knew it was a bailout and wanted a politics-free way of saying “screw you”.
Because these companies won’t be around long enough to collect this money unless they declare Chapter 11.
Excellent job, Democratic Congress. Hopefully a decent company will give these workers new jobs.
2010 is the perfect time. After all, then it will be midterm elections and the politicians can use it for political mileage.
Looks like Ayn Rand got it right. Buy gold.
The part that people forget in talking about Rand is that you’ll also need to buy guns, and that winner is whomever has both the guns and the gold.
Good. Hopefully at least one of them go belly up and the other two will emerge stronger and worthy of our investment. I wouldn’t mind much if either Chrysler or GM filed C11 before these loans hit. I don’t think Ford’s in danger with their cash hoarde (although, depending on Ford Credit’s fortunes, things might get tougher).