For some reason, The Detroit News columnist Daniel Howes reckons the average Joe will blame the bankers when—sorry “if”—Chrysler goes Tango Uniform. Yes, the money men will take the hit “whether they deserve it or not. I say this not because it would be entirely fair, either, unless ‘fiduciary responsibility’ and the duty of lenders to determine whether a Chrysler allied with Italy’s Fiat SpA would have a shot at survival now are quaint notions that no longer apply. In normal times, lenders are supposed to decide where credit-worthiness ends and recklessness begins. But these are not normal times and bankers, as one of them quipped privately to The Detroit News, ‘are the most hated people in America.'” I know TTAC is guilty of first degree inside baseball, but I’m not feeling that at all. The average American will place the blame squarely on Chrysler for not building competitive products. But it’s interesting that Danny “I can’t get off the fence but I know who’s on either side” Howes would see it that way; it shows that Detroit still can’t take responsibility for its failures. Or admit defeat . . .
A flurry of discussions during coming days could still produce an out-of-court solution.
This from another DetN article on Chrysler’s forthcoming Thelma and Louise moment. What I don’t get: who gives a flying you-know-what if the next chapter in Chrysler’s saga is settled in or out of court? The only real question is whether or not more of our money will disappear down the ChryCo-shaped rathole. To which the only possible answer is yes—no matter what.
In Washington, the Obama administration’s auto task force continued intensive negotiations with the United Auto Workers on an agreement to protect the bulk of workers’ health care and pension benefits in the event of bankruptcy.
One thing’s [even more] for sure: the money flowing towards what’s left of Chrysler won’t be Fiat’s.
In Italy, Fiat SpA Chief Executive Sergio Marchionne said he was still committed to concluding an alliance with Chrysler, but reiterated that the Italian automaker would not inject cash to close the deal.
Ever.
Marchionne said demands that Fiat put cash into Chrysler are “unjustifiable.” He said Fiat might put some cash into Chrysler later on, noting that the company would have an option to increase its holding in the Auburn Hills automaker. “We are going to commit cash at the relevant time, if the situation arises.”
Hang on; if putting money into Chrysler is “unjustifiable,” what’s the Presidential Task Force on Automobiles reasoning for propping-up the Auburn Hills zombie? Answer on a postcard. Void where prohibited by law.
The banks that own most of the Chrysler bonds are the ones that the government controls. They are willingly going along with the UAW bailout. The hedge funds are resisting. Why would you take ten cents on the dollar when bankruptcy gives you 65 cents?
Yeah everyone will be really upset with the companies that funded Chrysler with the money to get them where they are today. Right. So the Government is the savior for giving Chrysler money NOW but the bondholders that gave Chrysler money previously are somehow at fault??
bluecon:
Why would you take ten cents on the dollar when bankruptcy gives you 65 cents?
The relevant question is, “Is 10 cents on the dollar is so appalling that litigating (for years) is principaled.”
Is it correct that a lot of these smaller firms have taken no TARP funds.
And regarding the UAW’s potential haircut: Ex-union members of the steel and airline industries took some brutal haircuts.
I can’t see how the morons of the PTFOA are blind to the fact that Fiat’s just after money from any government that will give it to them, and why they haven’t shooed them off yet. Chrysler is going down in flames, and they’re going to hit the ground really hard. Everyone with any sense is staying away from Chrysler, and the vultures are starting to circle the body to see what meat they can pick from the bones. Liquidation is imminent, so how are they going to justify pumping more of our money into this piece of absolutely useless shit of a zombie automaker? I am so not happy with this situation at all, and watching my thousands of dollars of taxes getting pissed into this fire is extremely frustrating.
Actually, the average Joe isn’t as stupid as congress, Chrysler, or the press make us out to be. We blame Daimler. We remember when Chrysler was flush with $7 BILLION in CASH. Because of that Chrysler was bought out by Daimler in what was billed as a “merger of equals” Why was this allowed to happen? Daimler even admitted it was a ruse, after the fact, to get the deal done. The justice department, under the Clinton administration, completely ignored it. But the reality is we were raped by the germans and all they left was a stinking corpse. Chrysler management left in droves. Designs stagnated as the germans lost interest once they had pillaged the $7 BILLION in cash. I’m surprised they stuck around as long as they did. Really, once you are done screwing the fat girl, aren’t you supposed to leave before she wakes up?
I would just like to note that in a recent episode of “Chuck”, all the bad guys drove Sebrings.
@ timbo58: The problem, I wager, is that the average Joe probably doesn’t know much of anything about Chrysler except that their current product line is crap.
I would just like to note that in a recent episode of “Chuck”, all the bad guys drove Sebrings.
I knew there was a reason Fulcrum seemed extra evil.
I assumed Fulcrum just used rentals
The Taxpayer is the world’s greatest fool.
The US Treasury is going to put US taxpayer money into Fiat in this Communist/Fascist hybrid corporatist arrangement…This could have only been thought up by some Ivy League University Humanities Twit.
We have seen this happen for years and years where the unions are involved. They tie the hands of corporations, threaten strike, the company pays more, management realizes they cannot compete, executives hold it together as long as there is a paycheck, the company fails, union workers start all over, lose pensions, union leaders keep their salary and pension, unions hopefully organize the sheep at the new company they plan to pillage.
We don’t buy union label at our house. We do not support socialism.
X-union member who saw it happen first hand!
Kudos to Kilroy in the preceding post – he’s got the unions’ number.
I presently own a 2006 Jeep.
However if there’s a “government sponsored” packaged bankruptcy in which the UAW doesn’t take a meaningful haircut, the Jeep will be the last UAW assembled vehicle I ever buy.
I’m sick and tired of greedy special interests buying politicians and using them as middlemen to pick my pocket.
Amen Kilroy. Fact of the matter is, whenever I see “union made” on any product I do not buy that product on principle. In fact, I run in the other direction.
The banks that own most of the Chrysler bonds are the ones that the government controls. They are willingly going along with the UAW bailout. The hedge funds are resisting. Why would you take ten cents on the dollar when bankruptcy gives you 65 cents?
Funny how the banks have a different attitude when they owe money.
Really, once you are done screwing the fat girl, aren’t you supposed to leave before she wakes up?
What if she falls asleep on top of you?
I would just like to note that in a recent episode of “Chuck”, all the bad guys drove Sebrings.
And on the Timothy Hutton TNT series Leverage the bad guys all drive domestics (they even put the Lincoln star hood ornament framed right in the middle of the screen just to get the point across) because Hyundai has a cross promotional product placement deal with the producers.
Leverage also has a product placement deal with Tesla.
Speaking of Chuck, Sarah or Chuck’s sister?
@Ronnie Schreiber: You mean hotter? -Chuck’s sister.
She could knock down half of midtown with those hips.
Ronnie Ronnie Ronnie, NEVER let the fat chick on top!
I wish I could buy American non-union, but you just can’t. I love my Chevy, and hope they’re around when it comes time to replace it. If they’re not, I will consider the union partially to blame, but Detroit is just as much at fault as the union for their demise. Years and years of turning out absolute crap is what killed them, not union labor costs.
If GM (Ford, Chrysler, take your pick) built the world’s best cars, paying a premium for them wouldn’t be much of an issue. As it is, they are behind the competition on most products, and to add those costs to the bottom line makes the vehicles even less palatable. Detroit, especially GM, was smug back in the day, and they kept that attitude for a long time, until Toyota started handing them their asses on the sales floor. Then they just shifted to highly profitable trucks, which backfired when gas prices started creeping up. There have been a few decent cars to come out of Detroit in the recent past —Chrysler 300, Ford Fusion, Chevy Malibu are each company’s best efforts as of late—, but nothing to make people swarm the showrooms. As for compact offerings, the only thing that’s been even close to competitive was the first Focus, and Ford let that one die on the vine.
Bottom line, to me, is that unions did screw Detroit a little, but Detroit is to blame for the half-assed efforts they designed and put on the road. To rebuild, the U.S. auto industry would be better off without the UAW, in my opinion, but they also have heaps of other stuff to work out before they’re fixed.
It’s quite amusing to the see the plebs now blaming the cleanup crew. The damage to the individual companies were already done by their poor management and planning, the damage to the economy is already done by the financial thieves, and now that the shit’s been dumped (ie. externalized) to society at large (front line defense being the representative government with our money), the plebs are trying to distance themselves as if it’s a burden that’s unrelated to them.
I guess it makes sense in a way, but sad nonetheless.
Disclosure: I am not now, nor have I ever been, a union member. In fact, I am a partner in a small business, which puts me smack dab on the management side.
With that said, why is the MSM obfuscating the real story on who’s to blame for the present state of Chrysler and General Motors? It sure isn’t the fault of the UAW or the banks.
The UAW wasn’t the only signatory to the bloated contracts, was it? It certainly wasn’t the UAW that designed and engineered thirty years of substandard automobiles, was it? It wasn’t the UAW that offered poor warranty and service work, was it? It wasn’t the UAW that continued to support a bloated and sleazy dealership network, was it?
The finger of blame can be pointed directly at GM’s BoD’s, and it’s upper and middle management. With Chrysler it’s obvious Daimler was the worst offender (to support this claim, I direct you to Allpar.com, wherein several stories relate tales of Daimler’s mistreatment of the staff and products, and callous disregard of the “partnership of equals”).
At any point during the past forty years GM’s BoD’s had multiple opportunities to stand up to the UAW in contract negotiations, but didn’t. To blame the UAW for what’s ailing GM is just flat out wrong. In no way am I excusing the UAW for the recalcitrant position they’ve taken in regards to sacrificing wages and benefits to help salvage GM, but that’s a different story.
Rick (Red Ink Rick) Wagoner and his predecessors always took the “short term gain” position in every bargaining session with the UAW, and in fact, took the short term position with regards to every decision, or non-decision, that they ever made. There are very few examples of GM looking forward much past the next quarter’s profits. Why should this be the fault of the UAW?
The MSM and the blogosphere are chock full of stories and editorials about the gross amount of pay and benefits earned by members of the UAW, but it’s a red herring, really, because the UAW wasn’t ever responsible for what transpired in the boardrooms in Detroit.
GM’s BoD’s was (criminally) negligent in my opinion, and are almost wholly responsible for what is ailing GM. It is not the fault of the banking sector that GM was ill-prepared for an economic crisis, it’s not the fault of the car-buying public that GM has manufactured sub-standard product, it’s certainly not the fault of the UAW that GM has sold product at a loss for the last several years, it’s not the fault of white-collar employees that GM has sold off seemingly profitable divisions to raise cash to support the unprofitable core business. This situation can be entirely ascribed to GM’s BoD and senior management.
Just my opinion of course.