I caught the following on fordmuscle.com. The author agreed to let me republish it here:
There’s an old saying, “Everyone is a capitalist on the way up and a socialist on the way down.” While GM’s circumstances are tragic, we need to let capitalism take its course. Propping up GM hurts the competitors who aren’t asking for handouts. It makes the playing field un-level. Ford is the fittest, and when resources are scarce, the fittest shall survive and the weak potentially go extinct. Ford stands to increase its market share dramatically if GM (and Chrysler) were allowed to fail. By doing so Ford would be able to make more cars, hire more workers, and be a better competitor in the global automotive market.
Now that’s its all over bar the shouting (Saab has filed for the Swedish equivalent of bankruptcy), the shouting begins. Saab’s new owners (themselves) say they need $1B to stay in the game, and they want GM to pay it. (Reparations?) Automotive News [sub] reports that GM is willing to surrender a big chunk of your taxes to cut bait and [Swedish] fish. But not a billion. “GM Europe’s head of communications Chris Preuss said GM was prepared to provide some funding for Saab but the brand needed outside money as well.” And who in their right mind would provide the lion’s share of this IV drip? “We have asked the Swedish government for loan guarantees for $600 million to give Saab a balance sheet as an independent unit which will allow it to continue.” The Swedish government has said no. So Saab is hitting up the European Investment Bank for a €500m loan. So . . . now what?
“On thursday, supplier P-E Plast stopped their delivieries of parts to Saab in Trollhättan.
The owner, Patrik Ekwall, who runs the company since some months back, is afraid he won’t get paid for his deliveries, reports Swedish Radio (SR).
At Saab, no one answered when he phoned them. “We are wating for a reply” he says.
The last month, P-E Plast has delivered parts for 400 000 kronor (around 80 000 dollars) to Trollhättan. The company makes plastic details for the car industry, and a third of its sales goes to Saab.
In spite of the current circumstances, Patrik Ekwall hopes to keep the eleven employees.”
Since the beginning of Detroit’s slide into federal dependency, TTAC’s Best and Brightest have applied their razor-sharp wit to this sad, sad situation. But the bailout boondoggle beggars belief—overwhelming any attempt to subdue it with sardonic humor. To wit: the TTAC meme called American Leyland. On a scale from absurd to certifiable, the marriage of the two ailing American automakers comes pre-wrapped in a straitjacket. Earlier today, I suggested it was too stupid a concept to fade from federal consideration. And the more I think about it, the more it seems inevitable.
Alternative headline: “Extortionists Are People Too”
“It’s worth wondering why Detroit’s automakers are still having such a tough time winning public support. Do Americans still not grasp the consequences of a GM bankruptcy? Have the companies so soured confidence in their products that Americans think them unworthy corporations? Are their CEOs so uninspiring that Americans just don’t trust that they’ll turn things around?
Hard to figure how these companies, which employ millions, and whose spinoff industries reach into every nook of the manufacturing sector nationwide, can’t get more support than they are. They’ve got detailed plans. They’ve been forthcoming about their circumstances.
Do people really believe the nation would be better off if they didn’t survive?”
The Daily Mail reports on a warning by the UK’s Unite union to Chancellor Alastair Darling. The union told Darling that 100k jobs are at risk by the “imminent” closure of a car factory. “We made it absolutely clear that the prospect of a plant closure will have a devastating effect on UK manufacturing,” Unite’s Derek Simpson told the paper. “Immediate and effective intervention is required from the Government.” That would be a £13b bailout. Yes, yes. Who’s in danger of going belly-up, then? As, the Brits would say, that would be telling. Keep in mind, that the union boys are throwing around the 100k number in the same way that the infamous CAR study claimed 3m U.S. jobs would be lost if Detroit didn’t receive a federal bailout. You know, counting anyone even remotely affiliated with the car biz, like gas station attendants. Anyway, according to the Mirror, “All the major car manufacturers denied they are considering shutting down factories in Britain.” So I’m thinking . . . Vauxhall told its UK CEO to “send the boys ’round.”
Boston.com reports that Massive Taxes’ Governor is pledging to freeze toll charges throughout The Bay State. Before you get out your huzzahs, see: above. “Governor Deval Patrick said today he is looking at a Hummer tax—adding higher registration fees for gas-guzzling cars [ED: presumably SUVs will be rounded-up and shot] and offering discounts for those that do less harm to the environment.” The battle lines are drawn across entirely predictable boundaries, with common sense going out for a cup of Clover (at the taxpayer’s expense).
Now that Chrysler and GM have submitted their “viability plans,” the Congressional corridors of power have been eerily silent on the subject. Oh sure, the White House Press secretary said something patriotic about preserving this, that and the other thing. And the presidential clusterfuck committee charged with sorting this shit out is meeting even as I obscene. But I was expecteding a lot more public political positioning on Motown’s second round of trough snuffling. Never mind. I reckon Chrysler and GM will get their/our money and soldier on. I also predict the feds will direct Cerberus to toss the keys to Chrysler to GM. Political expediency—the need not to “throw in the towel” on any aspect of the U.S. economy—makes ChryCo inviolate. So why not lump all of Detroit’s “troubled assets” together and create a federally controlled—sorry, “supervised” American Leyland? It’s such a horrendous idea on so many levels it just has to happen. Or not. What say you?
A New Zealand resident who wants a red light running warning citation sent to a stranger or an enemy only needs to call a toll-free phone number. On Tuesday, the Manukau City Council unveiled its program that allows anyone to contact the police and accuse someone of an intersection traffic violation. “We’re asking the community to join the council in sending a message to these drivers that it’s not on,” Manukau City Council member David Collings said. “If people see drivers running red lights they should dial 0800 STOP 4 RED.”
Yet again, a manufacturer is releasing an image which shows a bit of a car to generate excitement at the prospect of seeing . . . the rest of the car. Wasn’t there a board game like this, where you had to guess the whole image as little pieces were revealed? Well, I find the hide-and-seek, slow-reveal automotive press release shtick an inherently infantile practice. Resisting the urge to blame Autoblog for this outbreak of electronic peek-a-boo, thrilled as they must have been with the 235 “teaser” shots provided by FoMoCo in the run up to the entirely predictable 2010 Mustang, I will not resist the urge to call this technique the autoblogospherical equivalent of dickless porn. Do I really care what a new fender vent looks like?
Looks like President Obama’s team has a loose grasp on the realities of the U.S. automotive market, as in who builds what where. Either that or a firm grip on what the public needs to hear to sign-off on the roughly $100b’s worth of taxpayer money headed in Motown’s direction, pissed away trying to resurrect the dead and forestall the inevitable. I mean, preserving an important part of America’s industrial base and protecting America’s middle class.
Ingvar, Swedish member of TTAC’s Best and Brightest, translates a report in today’s Aftonbladet:
“Aftonbladet can disclose today that Secretary of Industry Maud Olofsson fasttracked GM into the Europan Investment Bank. But GM said no. A source says: GM wasn’t interested in saving Saab.
In the late fall, Maud Olofsson had talks with GM Europe boss Carl-Peter Forster. Olofsson offered GM government loan guarantees if they turned to the European Investment Bank. But his response was lukewarm. It takes too much time to go through EIB, was his answer.
But Olofsson didn’t give up. In early december, she contacted EIB and asked them if they could fast track GM’s eventual case. The answer was positive. But when GM was told, they were only making excuses. There was obviously no interest from GM in pursuing the case, they only kept stalling, a source says.
Between holidays, the Swedish government called in consultants to review the numbers for GM and Saab. They shook their heads in despair, there was no reality in the numbers, a source says. The advice they gave: Forget about Saab.”
Sorry about the pun (referring to the yearly sales rate), but Automotive News [sub] nailed the headline, and I couldn’t just repeat it without a little TTACitude. Sometimes, though, the simple truth is all there is. The fact that America’s largest publicly traded dealership group has cut new vehicle orders by 60 percent is… stunning. It means that that the U.S. new car market is dead in the water. Federal bailout or no, someone’s going to take a dirt nap. Not that Mike Jackson thinks so. The AutoNation CEO reckons U.S. new car sales have stabilized at a rate of 10 million per year, and expects that number to climb over 11 million by the end of the year. What’s more, the formerly pessimistic Jackson has looked at Chrysler and GM’s new viability plans and put Smash Mouth’s “I’m a Believer” on his iPod. “I felt the outline of the direction they gave back in November was too optimistic on the sales side and not deep enough on the cuts side. These plans are much more realistic and it’s the right approach.” So another one bites the rust. Or something like that.
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