The Wall Street Journal gets its fair share of flak from TTAC. Now it’s time for a pat on the head. Under a downright TTAC-ish headline (“Treasury to Ford: Drop Dead”,) the WSJ lambasts the Treasury for being a bunch of unappreciative sumsabitches: “When the Bush Treasury decided to bail out Detroit, GM and Chrysler quickly said yes to the taxpayer cash, but Ford Motor Co. said it didn’t need the money and declined. Ford’s reward for this show of self-reliance? Treasury is now helping GM again by giving it a credit pricing advantage against Ford in the marketplace.”
Farago wrote: “If I were the head of Ford or Toyota or Honda’s lending unit, I would be mighty pissed.” The Wall Street Journal agrees. Now that the U.S. Government effectively owns GMAC, it gives them the money to offer zero percent financing – for GM products. Says the WSJ: “The messy little policy issue is that these GM products compete with those sold by Ford, Toyota, Honda and numerous other car makers that won’t benefit from GMAC’s cash infusion. And with the cost of financing often crucial to buyer decisions, the feds have now put the muscle of the state behind one company’s products.”
We haven’t seen the rest of it, thinks the WSJ: “With the taxpayers now having a stake in GM and Chrysler success, the Washington temptation will be to take other steps to help the two companies gain market share at the expense of their private competitors.”
It’s not just the heads of Ford or Toyota or Honda’s lending units that should be pissed. We, as the US tax payers, should be very, very pissed. Says the WSJ: “Your neighbor who buys a GM SUV this weekend with 0 percent financing should thank you when he pulls into the driveway. He did it with your money.”
And while on the topic of heads… The way this is heading is towards a WTO complaint. Countries, the U.S.A. included, have sued for much less egregious unfair advantage than that one.
PS: The Washington Post has a similar story. Their head is even more TTAC-ish: “Cash Guzzlers.” Except that they are not harping on about free enterprise. The Wapo is hitting the green angle: “through the GMAC bailout, the U.S. government is enabling GM to overcome (or try to overcome) the market’s resistance to its inferior merchandise — and it is doing so in a way that directly clashes with public goals such as conserving energy and fighting global warming.”
I believe they refer to this as a “dick move” in the vernacular.
While the injustice is readily apparent in the micro, if you pull the lens back a bit you can get a different picture.
At the end of the day, the only one of the D3 that has made any palpable changes to corporate culture is Ford. The big F is seen as potentially the only dog that might be able to hobble away from this fight.
So, the other two scrappers will get bandages and Alpo treats thrown into the ring just to make their deaths appear a bit more merciful.
Yes, Ford will eventually have to do C11 just to be competitive with whatever is left of GM/Chrysler when the dust settles. But until that point, there may not be a lot of mercy shown to them.
This isn’t a new show. Pretty much every airline has done a BK. Or two. Or three. Except Southwest. It’s a bitch, but SWA keeps on despite having not availed themselves of the bankruptcy courts.
Okay guys, it was interesting for a while, but the whole ‘Bailout is evil’ shtick is getting old.
We get it: none of you like the bailout or GM and Chrysler.
It’s done and there’s not a thing anyone can do about it. So why don’t you guys take a deep breath and get back to the reviews and the thoughtful commentary. If you don’t, you’re going to lose any credibility you’ve built up with your readers, and eventually the readers themselves. (it’s called the New York Times syndrome)
Grow a pair and just stop covering it.
@Droid800: Last I looked, I still had mine and I will cover the news as I see them. If you want to know what America really thinks about the bailout, head on over to Chrysler’s own site (while it’s still there…) and read the comments.
Except this isn’t news. It hasn’t been news since the bailouts went through.
You guys are beating a dead horse and its getting old. Your readers are sick of it.
@porschespeed,
So, when do I get my free tickets from Continental?
I guess that the way this works is that the government decides that we should be a kinder, greener nation.
So what they do is enable GM to give us all 0% loans on medium quality gas guzzlers?
@Droid: If it’s not news, then write a letter to the WSJ and complain.
@porschespeed: That’s the way it appears.
What people need to understand…is that FORD DID NEED THE BAILOUT MONEY!!!
If they didn’t, then they wouldn’t have been there.
Sure, they didn’t need it directly, but Ford has said that if GM and Chrysler went under, they would be dragged down as well…ergo, Ford needed the money.
And with all of the problems I have had with my Ford…Ford could (maybe should) drop dead.
@Droid800,
I understand that you don’t want to hear about this stuff. But it is news. Just like the continuing stories of pissing our money away on the banking industry, it can get long in the tooth.
I really don’t understand the argument for not covering it. Most people that I know (some of them dedicated D3 buyers/collectors) find TTAC’s coverage some of the best out there – because they enjoy getting news that’s not cheerleading for a team that can’t win until it gets a new coaching staff.
As to the “anti-GM/Chrysler/bailout zealotry” I think you are missing the point. When your friends and physicians tell you to lay off the booze, drugs, $20 truck stop whores, it’s because they want you to be alive in 5 years.
When that person fails to alter their behavior, tells you everything is fine and then hits you up for money, out of your grandkids college fund – it’s tough love time.
@dgduris,
If I knew the answer to that one… The fun thing about aviation is that if you add up all the profits and losses – starting from the dawn of commercial aviation till right now – throw in the cost of airports and the FAA, the balance sheet is net negative. It’s subsidized transport.
@ porschespeed
As to the “anti-GM/Chrysler/bailout zealotry” I think you are missing the point. When your friends and physicians tell you to lay off the booze, drugs, $20 truck stop whores, it’s because they want you to be alive in 5 years.
I look out for your comments. Thank you.
I think you took the challenge to fix Chrysler the other day, but you would be a loss to Stuttgart.
@PeteMoran,
Thanks, I just call them as I see them.
Keep smacking them, as often as you like. And this wasn’t old news, it was pointing out another angle that gm boosters want to ignore; not only is this a waste of money, it will harm healthier competitors. It also highlights the underlying horror show about govt involvement. Once they take political responsibility, not to mention financial, they don’t want it to fail and they’ll do everything possible to keep it afloat to avoid political embarrassment.
CNBC.com is reporting the government will decide Citi style bailouts on a case by case system. There is a lot more here than the auto industry getting help…I wonder how the Washington machine will un-wind its positions, and decide the timing, could be used as a political time-bomb.
The bailout isn’t old news. It’s an ongoing and expanding scandal. And yes we can do something about it now: (a) Don’t buy GM or Chrysler cars, and (b) Make it clear to our Senators and Representatives that if they don’t take a stand on this we’ll elect someone who will in 2010 (or whenever reelection time comes in the case of the Senators).
Remember the old days- was it only a couple months ago- when free money from taxpayers given by the Big 3 (Congress, Administration, Fed) to private companies was done to “prevent total global thermonuclear financial meltdown?”
Although early press stories showed citizens overwhelmingly against it, the press stopped carrying such polls. In fact, the press simply rolled over and shut up.
And now the Big 3 throw out free money to everyone they want anytime they want, without explanation. Since nobody is complaining, they don’t even bother to put out bogus excuses anymore. It’s unending.
Time for a name change. Government Motors.
Seriously I see people getting a grip on reality, but, we are no where near where we need to be just yet. This is the silver lining of the economic downturn, people are coming down off of their greed inoxication, and seeing the house of cards for what it is. Like a computer, the economy needs to crash so we can restart it.
GM has been a contemptible company since the 80’s, if not the 60’s. Best thing they can do is to go out of business. Government propping up this medoiocre monstrosity is ridiculous, and to my mind”s eye, a good measure of just how much out of touch with realities we still are.
Heh Droid. Yeah, this bailout is done.
And if its the only money they ask for or get, I will be slurping strawberry flavored Icees in hell.
They’re bitching in preparation for the next bailout.
Ford’s dilemma is what bailouts are all about:
Successful companies/people are economically punished by being forced to support others (competitors) who can’t or won’t make their own businesses sustainable.
Round two will be even better when the Gov’t starts picking winners and losers in the Tier 1 supplier pools.
I for one am not bored of reading about the bailout. In a relatively short time the world economy has lost 30.1 trillion dollars of market value, the US banking and automobile industries have essentially been nationalized, states are going bankrupt – and some people think you guys should stop writing about some of this because they’re bored of it? The events happening are historic and unprecedented. I’m going to guess those that don’t want to talk about the bailout are for it, or perceive that they are benefiting from continuing gov’t largess.
To me, the bailout is moronic. Gov’t bailouts worldwide are an economic buttplug shoved up precisely at the time the world economy should be having a huge enema.
TTAC, keep up the great work on the economics of the auto industry. There are dozens of sites where I can read piffle about autos (“The dashboard layout is great, but the plastics are too hard..”) but not very many that tell the hard truth about the politics/finance of the auto industry. This crazy gov’t intervention may become the template for a host of other industries. God help us.
droid, you have an option not to READ the editorial or news content. Amazing, isn’t it, the freedom of choice?
This bothers me since, if I were to pick a product from a domestic maker as my next purchase, it would almost certainly be from Ford. GM and Chrysler have zero product on the lot or in the pipeline that remotely appeal.
i wasn’t aware that ford declined the money.
this is why i like ttac’s coverage of the bailout – usually learnin’ something good.
next car purchase will be a ford – turning down money because they don’t need it? most excellent.
At this point, I am angry enough at GM to wipe off the only GM product in my consideration set- the Caddy CTS- off my list. Unfortunately, Ford doesn’t make a car that interests me at this point…a gussied up Fusion doesn’t cut it for me. Looks like it will be all Japanese again for my next purchase.
I can see Ford willing to lose out on some cash for increased consumer confidence, but they probably didn’t think it would be THIS much.
Instead of a GM Chrysler Bandit Boycott how about something more positive? Level the playing field and say no to government bailouts — buy a Ford.