According to Automotive News [sub], Boot ’em Bob is having visions of Carmegeddon. “Bob Nardelli, just 14 months into his tenure as CEO of Chrysler LLC, now fears the collapse of an ‘extremely fragile’ auto industry amid the credit crisis and Wall Street meltdown.” Uh, I think Big Bob means the domestic auto industry. And anyway, why would the ChryCo’s CEO conjure visions of doom when his company is OK? I mean, Chrysler’s doing fine right? “Nardelli said cash is ‘the number-one metric for the auto industry.’ In Chrysler’s case, he said: ‘We’re concerned about it. We’re monitoring it, but we’re not on the edge.'” The entire industry’s about to collapse but we’re good? Parse that. Meanwhile, the rest of the article makes it perfectly clear (in the Nixonian sense) that Nardelli’s comments are a prelude to a kiss. With Uncle Sam. “Nardelli said federal officials, preoccupied with trying to unfreeze credit, don’t appreciate the importance of the auto industry.” I know, insulting the feds doesn’t seem like the best way to make them want to give you billions, but, well, that’s how Bob rolls. “Nardelli said the auto industry faces unique federal regulatory burdens, such as increased fuel economy requirements. ‘I’m not sure it’s registered at the highest levels the impact of losing the auto industry. When I say the entire industry, it’s not only the OEMs; it’s the Tier 1, Tier 2, Tier 3 suppliers.”
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I can’t believe I am writing this….
Maybe the the US government should increase the sales tax on vehicles sold in the US from non Big 3 automakers (Toyota/Honda/Nissan/etc). You know protect US companies? The big 3 will try to increase prices accordingly as they have in the past. The stipulation of this tax increase would be that if the Big 3 increase prices in excess or equal to this tax increase then this action would be canceled and the Big 3 would see the sales tax on their vehicles double as a penalty.
American Motors NMC
http://www.theautochannel.com/news/2008/10/12/169387.2-lg.jpg
(NMC = “Nationalized Motor Company”) owned by the FED, of course. (i.e. bankers).
Wow, would every car come with a free toaster? A piggy bank between the front seats? Of course, it’d be computerized so if you didn’t make your payment on time, the car wouldn’t run.
I can see it now. Chrysler quality plastic interiors (aka Play Skool). GM quality brakes and modern (i.e. 1955 tech) overhead valve engines complete with oil & water leaks, standard equipment! Ford “flaming” cruise control (not forgetting Firestone tires). Wow, what a combo!
They may as well go whole-hog and be historically correct about it.
The subcompact could be called “Gremlin” (appropriate – since Gremlins were originally a term for mystery problems on aircraft during WWII).
The compact could be called the Pacer (naturally!)
The mid-sized car the Matador (may as well play up the idea of selling to illegal aliens as well – a twofer!)
The luxury car, of course, would be the Ambassador.
And the sports car, the AMX, of course…..
The minivan could be the AMC Rambler Cross Country.
And the trucks could be the Jeep Gladiator.
The other Jeep to continue would be the current Wrangler. Mustn’t forget to offer a Wrangler Jeans edition, though!
Oh yeah, almost forgot, the crossover would be the Eagle, and the SUV would be the Jeep Cherokee.
As for an electric and electric hybrid cars, hey, the name’s obvious. AMC Edison.
“U.S. Auto Industry About to Collapse”
About to?
Ah, Bobby goes public with gloom and doom just in time for nation-wide employee buyout offers.
I read in the WSJ last week that the Home Depots in Phoenix are just now unloading their inventories of riding lawnmowers that Commander Bob and his MBA friends decreed should be stocked as part of a “nationwide standardized inventory” approach.
might be interesting to run a chronology of bob’s statements before, during, and after the credit crisis…
im gonna take a wild stab and suggest ‘cognitive dissonance’ might be a decent title for the edit…. orrrrr the obit
You can’t just target part of an industry to tax to benefit the other half. Its actually unconstitutional … something about bills of attainder? My con law is rusty.
You’d have to find some justification for it, but what? I don’t think a tax on smaller, more fuel efficient vehicles is going to go over too well with the American public. And if you only go for the cars that are actually imported from Japan (which would be ok) you’d be slapping a tax on Fits and Priuses mostly. That’s… not so hot or likely to change much.
Let them die if it comes to that. The problem is with those companies in particular; its not like an American car manufacturer HAS to be bad; it’s just these companies. If they go, we might actually see an American car company that could compete without relying on flag-waving. That would be a good day.
The Big 3’s survival until today was based on the exact thing that is causing so much chaos now; lots and lots of loose credit. Gas prices killed their cash cow, the credit crunch is going to kill whats left. If they hadn’t ridden those two trends into a frenzy of SUV selling, they probably would have died years ago. This whole thing is a whole hell of a lot of chickens coming home to roost.
“I look forward to doing for Chrysler what I did for Home Depot … pissing off customers and employees so much that the board finally tossed me off the loading dock. I know how to hire lawyers and I know how to use a parachute.”
“American Motors NMC” …. they got the name wrong. It’s American Leyland!
So, John, would the subcompact then be called the American Leyland Allegro, the mid-sized car the Maxi, the sports job the Stag, the luxury car the Princess, etc?
Nah, they’d just take a GM strategy from the GM playbook and have two or three more nameplates to put on the “XYZ-body” vehicle.
So if the markets have a complete turn around next year – do you think Detroit will pat themselves on the back for a job well done (what job well done?) and go back to business as usual?
Are things dire enough that Detroit management, union leadership and employees will have an epiphany about what’s pushing their livelihood into the dumpster?
How close to the edge of the cliff does Detroit have to get to find religion i.e. become a leaner and meaner business to compete with the imports with similar products and similar quality?
Look Bob is a new guy in here, he is an outsider. He needs some support. If it was Wagoner who said all of this i’d laugh in his 17 million dollar a year face. But Bob is new, fresh and i think(hope) he can really turn Chrysler around.
toxicroach: “You can’t just target part of an industry to tax to benefit the other half. Its actually unconstitutional … something about bills of attainder?”
No, the 14th amendment’s “equal protection” clause would be relevant. The constitution’s prohibition of Bills of Attainder stemmed from the abuses of power back in Britain. Wikipedia:
“The word “attainder”, meaning “taintedness”, is part of English common law. Under English law, a criminal condemned for a serious crime, whether treason or felony (but not misdemeanour, which referred to less serious crimes), could be declared “attainted”, meaning that his civil rights were nullified: he could no longer own property or pass property to his family by will or testament. His property could consequently revert to the Crown or to the mesne lord. Any peerage titles would also revert to the Crown. The convicted person would normally be punished by judicial execution as well – when a person committed a capital crime and was put to death for it, the property left behind escheated to the Crown or lord rather than being inherited by family. [What a temptation for the Crown!]
Due to mandatory sentencing, the due process of the courts provided limited flexibility to deal with the various circumstances of offenders. … the property of offenders who died before trial, including those killed during the commission of crimes, could not be forfeited, nor could the property of offenders who refused to plead and who were tortured to death through peine forte et dure. [Piling stones upon the accused until he confessed or died. This was used in Salem’s infamous witch trials.]
… In some cases (at least regarding the peerage) the Crown would eventually re-grant the convicted peer’s lands and titles to his heir. It was also possible, as political fortunes turned, for a bill of attainder to be reversed. This might even happen long after the convicted person was dead. [Thereby benefiting the heirs.]
…
Bills of attainder were sometimes criticized as a convenient way for the King to convict subjects of crimes and confiscate their property without the bother of a trial—and without the need for a conviction or indeed any evidence at all.
…
Although deceased by the time of the Restoration, the regicides John Bradshaw, Oliver Cromwell, Henry Ireton and Thomas Pride were served with a Bill of Attainder on 15 May 1660 backdated to January 1, 1649 (NS). [Talk about ex post facto!] After the committee stages the Bill of Attainder passed both the Houses of Lords and Commons and was ingrossed on 4 December 1660. This was followed with a resolution “That the Carcases of Oliver Cromwell, Henry Ireton, John Bradshaw, and Thomas Pride, whether buried in Westminster Abbey, or elsewhere, be, with all Expedition, taken up, and drawn upon a Hurdle to Tiburne, and there hanged up in their Coffins for some time; and after that buried under the said Gallows: And that James Norfolke Esquire, Serjeant at Arms attending the House of Commons, do take care that this Order be put in effectual Execution.” This also passed both Houses on the same day.”
You can see why the Founders wanted to put fetters on the national government.
Maybe the the US government should increase the sales tax on vehicles sold in the US from non Big 3 automakers (Toyota/Honda/Nissan/etc). You know protect US companies? The big 3 will try to increase prices accordingly as they have in the past. The stipulation of this tax increase would be that if the Big 3 increase prices in excess or equal to this tax increase then this action would be canceled and the Big 3 would see the sales tax on their vehicles double as a penalty.
Why should the Big 3 be protected? They drove their customer base away. They did not lose customers based on price points, they lost customers based on decades of inferior products. I could understand this argument if it were solely price-based discrepancies.