Congressional funding for the Department of Energy’s (DOE) $25b low-interest loans, designed to help Detroit retool 20-year-old (or older) factories to produce fuel-efficient automobiles, has just cleared the Senate. MSNBC reports that the $634b spending bill (which includes the provision) is now heading for President Bush’s signature, after passing the Senate by a margin of 72 to 12. Detroit’s lobbyists’ have little time or reason to rest or celebrate. The moribund new car market is feeding the flames of their cash conflagration right here, right now. The DOE’s “normal” timetable wouldn’t put the money in their mitts until 2010. Too late. As The Detroit News points out, presidential aspirant John McCain feels their pain. “McCain spokeswoman Sarah Lenti said the Arizona senator ‘is committed to a responsive and efficient government. In circumstances in which it is straightforward to anticipate the startup of a new program, he would insist that work would begin in advance and be completed in a timely fashion.'” Wiggle much? Only as much as Barack Obama. “After the progress of the past week this is disappointing news from the Department of Energy,” Obama spokesman Brad Carroll said. “Barack Obama understands that these loans are essential for keeping auto jobs here in America, which is why he would do everything possible as president to expedite this process.”
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An every other car maker can keep with this why? Because they have other markets that kept small engine cars profitable? Um…GM had more market share than all imports combined at one point though.
I’m interested in seeing whether GM will spew out even more of its “anti-C11” rhetoric with this money it has just secured.
This must be insulting to the transplants. It just says to them that the US government awards non-competitiveness and lack of innovation.
What a waste. So much money to slow down these industrial dinosaurs on their natural path to extinction.
All the taxpayer gets in return is a vague story about more fuel efficient cars. No hard commitments from the industry. The GM Volt was probably just a carrot to create goodwill for this bail out. The government should have called the industry’s bluff and demanded a minimum 40 miles all electric range for all big 2.8 offerings by 2015 in return. If this would accomplish oil indepency for America it would have been the best money the US taxpayer ever spend.
Now it’s just another unpaid bill in a humongous stack of unpaid bills this generation leaves behind.
I agree on requiring all cars to have a 40 mile EV only mode by 2015.
The imports all maintain their small car fleets through foreign markets – and why can’t Ford and GM do this too?
They have an excellent small car lineup in Europe. They should have the same flexibility as Honda or Toyota.
As well as begging for bailouts, Detroit needs to be begging for the USA and Europe to share safety, economy, and pollutions standards. That way anything that passes in Europe is available here with only a few exceptions.
joeaverage :
As well as begging for bailouts, Detroit needs to be begging for the USA and Europe to share safety, economy, and pollutions standards. That way anything that passes in Europe is available here with only a few exceptions.
I’m afraid you don’t quite understand the rational behind some US car regulations.
Many standards were influenced by the US carmakers to keep out imports. Notorious is the low speed impact regulations that favours big bulky (in a word: American) cars over sleeker imports.
Interestingly Bob Lutz has pleaded recently for a temporary suspension of these standards to allow him to drag in GM products from abroad to meet demand for fuel efficient cars. Of course only as a temporary measure. GM can’t afford a level playing field on the home turf in the long run if it wants remain the world largest (or second largest now) car manufacturer.
At some point in time, the silliness of the “energy independence” notion must start to dawn on people. We get our oil from very diverse sources – the most prominent one being Canada. Energy independence sounds nice, especially to the xenophobics out there, but it can only be achieved at astronomical cost and no genuine benefit.
Many standards were influenced by the US carmakers to keep out imports. Notorious is the low speed impact regulations that favours big bulky (in a word: American) cars over sleeker imports.
Most of these standards were influenced by adherents of Nader who were energized by his battles with GM and the smear tactics they used against him. If Detroit had there way, there’d be no NHTSA.
What did you expect was going to happen?
The U.S. government allowed rampant “free trade” that sunk the American auto industry.
There never was a “level playing field”.
Foreign automakers had their R&D financed by their governments. Or their labor costs were far lower than ours.
In any case, how could we compete with that? And the U.S. government just looked the other way. As long as people were buying cars, ANY cars, the economy was healthy….yeah, right.
A bailout is only fair.
Robbie :
At some point in time, the silliness of the “energy independence” notion must start to dawn on people.
And maybe at some point it will dawn even on people like poor Robby that every time he fills up he pays for the IED’s used against US soldiers in Afganistan and Iraq and violently anti- American jihadism (including efforts like the 9/11 attacks) around the globe, he pays for Venezuela’s Chavez’ petro dollar funded anti-Americanism, he pays for Putin’s ambitions to put the evil empire back together, and ultimately he funds the Iranian nuclear program, the fruits of which -like Obama stated in the debate- may one day find their way to the United States in a suitcase.
Better start wising up soon Robby. Hopefully an Islamist nuclear 9/11 style terrorist attack can still be prevented at this point, but if not at least you would have a clue what really made it all possible.
I’m certainly on board with not (indirectly) funding anti-American interests by reducing our use of oil from these countries, but China will certainly step in and fill any vacuum that we leave.
Then, the manufacture of cheap consumer goods from China will be fueled by the “terrorist’s oil”.
Will we then stop buying these goods, causing China’s economy to suffer? If so, will they cash in their chips (our debt that they hold) in retaliation?
We will live in “interesting times”.
And maybe at some point it will dawn even on people like poor Robby that every time he fills up he pays for the IED’s used against US soldiers in Afganistan and Iraq and violently anti- American jihadism (including efforts like the 9/11 attacks) around the globe,
Well, no. He pays for chrome-plated Bentleys for rich Saudis. If you think oil dollars fund terrorists, you’re mistaken. Oil barons, whether they wear turbans or suits, want the kind of radical change that Islamists are pushing.
he pays for Venezuela’s Chavez’ petro dollar funded anti-Americanism,
Well, yes. This he does pay for. So what? The man’s democratically elected and entitled to his opinion.
he pays for Putin’s ambitions to put the evil empire back together,
True, that. Russia is an ugly accident waiting to happen. Of course, we’ve been too busy gorging at the emerging-markets trough to do anything about either them, or China.
and ultimately he funds the Iranian nuclear program
This is true, too. Of course, since we were the ones who pushed out Mossadegh (you know, the democratically-elected moderate leader), installed the Shah and then about-faced and funded Iraq, it’s kind of our fault.
Never mind that Iran’s chief need for nukes is our steadfast refusal to call out Israel for having them as well. Any Middle-East interstate conflict of reasonable scale is going to result in Israel using weapons that, strictly speaking, it supposedly doesn’t have because there’s no way Israel could make it through another six-day war without a nuclear deterrent.
If I were the Iranian government, I’d certainly weaponize against a nuclear Israel.
Look, if you wanted cheap, blood-free, politically neutral oil, you’d be buying from Canada and possibly Norway. But that would be far too expensive (blood makes oil much cheaper), so it’s not going to happen, not as long as oil is a funglible commodity and there’s no stomach for humanitarian-based energy trade tariffs.
Well, no. He pays for chrome-plated Bentleys for rich Saudis. If you think oil dollars fund terrorists, you’re mistaken. Oil barons, whether they wear turbans or suits, want the kind of radical change that Islamists are pushing.
I’m guessing you meant to say that the oil barons don’t want the radical change that islamists are pushing.
But the oil industry of Iran is state controlled and radical change is exactly what mr Achmadinejad is pushing for (actually it’s called jihadism and it means that YOU are his enemy until you convert to Islam and subject your self to the islamic law, the Sharia; in fact “Islam” means subjucation)and America has in fact accused Iran numerous times of fuelling the insurgencies in Iraq and Afganistan.
The Saudi case is different. Their brand of jihadism is based on the wahabi doctrine and it’s a slow paced variant. They go with the flow driving their chrome plated Bentley’s abiding their time. They may not send checks to Bin Laden directly (that we know of)but they do invest a lot of money world wide in creating infrastructure for their extreme interpretation of Islam.
If you want to know what’s really behind “the war on terror” that is draining the US financially and that it appears to be loosing read Future Jihad by Walid Phares. This will explain exactly how you are financing your own downfall every time you fill up your car.
One of the major goals of modern jihad is the destruction of the state of Israel. Achmadinejad makes no secret of his ambition to destroy this country, but that doesn’t seem to bother you particularly. Whatever. Maybe it gets interesting for you that there is another country he wants to destroy even more desperately than Israel. This is the largest obstacle for his dream of global jihad and it’s called America.
Maybe Achmadinejad wanted to reassure people likes you when he hinted at Israel as the target for his nukes, and clearly he succeeded. The discussion seems to have degenerated to an “too bad for Israel” exercise. But if I had any real estate in New York I would sell it the second Iran did his first nuclear test.
The real power in Iran is Ali Khamenei. Ahmadinejad is president and merely executes policies set by Ali Khamenei. But we’ve got a convenient demon we can focus on as the problem instead of dealing with reality.
limmin :
September 28th, 2008 at 12:08 am
What did you expect was going to happen?
The U.S. government allowed rampant “free trade” that sunk the American auto industry.
There never was a “level playing field”.
Foreign automakers had their R&D financed by their governments. Or their labor costs were far lower than ours.
In any case, how could we compete with that? And the U.S. government just looked the other way. As long as people were buying cars, ANY cars, the economy was healthy….yeah, right.
A bailout is only fair.
Not to companies that refuse to make competitive products in the interest of short-term profits (i.e. trucks when oil was eventually going to skyrocket in price). You can’t be serious in saying that the three most dominant automakers in the world (until now) failed to build what Americans would want and need now simply because the government didn’t fund them? You’ve gotta be joking. It doesn’t take billions in R&D to figure out that Americans want cheap, smaller, dependable cars. It’s not a matter of R&D – they were just plain irresponsible and wrong. And even if it was – you think with those billions in profits and executive salaries they squandered they couldn’t figure out that a decent sedan is all they needed to build? Please. If you think a bailout for all three companies is fair, I’d like to see more from the Big 3 than just one company’s weak Volt.
Dutchchris: Many standards were influenced by the US carmakers to keep out imports. Notorious is the low speed impact regulations that favours big bulky (in a word: American) cars over sleeker imports.?
That will certainly be news to the domestic car makers, let alone the imports. (And given that foreign nameplates claim the four top-selling passenger cars in the U.S., it appears as though this sneaky plot failed.)
The standards were more influenced by Ralph Nader and his acolytes than by Detroit, who view vehicles as big bumper cars that should allow drivers to bash into each other without suffering any injury.
And if by low-speed-impact regulation you mean the 5-mile-per-hour bumper standard, that one was pushed by insurance companies over the heated objections of Detroit.
skygreenleopard: You can’t be serious in saying that the three most dominant automakers in the world (until now) failed to build what Americans would want and need now simply because the government didn’t fund them? You’ve gotta be joking. It doesn’t take billions in R&D to figure out that Americans want cheap, smaller, dependable cars.
No, what they wanted until the recent run-up in gas prices and credit crunch was luxury sedans and luxurious SUVs and crossovers. Which is why even Toyota and Honda were rushing to build vehicles that fit the description.
Even now, please note that the four best-selling passenger cars are the Toyota Camry and Corolla and Honda Civic and Accord. They are reliable, but the Camry and Accord certainly aren’t that small anymore, and not one of them could fairly be described as cheap.