Comments on: Bail Out the Big Three? History Suggests “Don’t Do It”!

By: uni

uni — Wed, 05 Jan 2011 07:07:59 +0000

very nice car post, i love that

By: Wil - Indy

Wil - Indy — Mon, 17 Nov 2008 16:02:18 +0000

I hear little commentary about the foolishness of self insuring by the big three. In what universe is it advisable to co-mingle profits, R&D funds with medical insurance, retirement and credit union liabilities? In my corporate working life, 401Ks, medical insurance and other benefits managed by separate carriers or isolated in independent growth funds. Self insurance is a formula for self immolation. Was the rationale behind this, pure greed and the desire to leave the door open to loot those funds?

Wil
Indy

By: Wil - Indy

Wil - Indy — Mon, 17 Nov 2008 15:35:42 +0000

Friends;
I see most straw polls & media vox populi opinion readins show 70%-90% population AGAINST the auto industry bail-out. The politicos may do the opposite as if hypnotized by an evil demon and forced commit suicide. The common citizen either instinctively or overtly understand that a UAW bail-out is like a transfusion without stopping the bleeding from a major artery. They need a union house cleaning. Unfortunately the good life in Detroit is over.

Do you remember when H. Ford raised the pay for Model T workers on his Flanders assembly line to $5 a day? The best paid workers in Detroit in 1919. Doubtless the union thugs will want another sit-in and stoppage like the 1930s when the Ford’s Pinkerton regulators and “off duty” cops shot and whipped the UAW squatters and beat up Walter Ruther. Might be some nice homes available on the Cheap in Detroit. Those middle class neighborhoods north of town are pretty nice, with huge 3-4 bdrom ranch houses and wide 4 lane divided boulevards and beautiful parks and shopping malls, now mostly empty.

Repopulation. Frankly, because of the self-destructive practices of the current and former politicos and coprporate managers, we will need the illegals to pay the taxes to keep the ship afloat. The self fulfilling suicidal policies of deficit spending on dependancy generating social programs has had a debilitating effect on the character of Americans. It has had just the opposite effect of the traditional American system of stimulating lean self motovated individualistic self reliant population of healthy fiesty patriots. That was the old world. This is the new whining, mewling world of parasites and panderers.

They (the corrupt politicos), must transplant the migrants of Nogales, Tijuana and Juarez and the cab drivers and janitors of Yemen to Detroit and repopulate with four families to a foreclosed $400K house selling off at auction for $75K. Learn to speak Spanish and Arabic and get along fine with neighbors. The unoccupied houses can be broken up for firewood.

Trivial aside; Did you ever drive in Detroit? In the north suburbs like Warren and Sterling Heights they have a no-left-turn traffic pattern and all left turns are made mid-block in special turn outs so that intersections remain clear. They used to have some innovative thinking and built a strong, well conceived civic structure with a high standard of living for themselves. Then it went sour and rotted from the inside.

Greedy corrupt unionism. Crass obnoxious corporate marketing and mimicry in styling. An absurd imbalannce of cost vs profit margins compared to the unencumbered Asian and European mfg. It costs $75+ an hour per union worker to make an US car in a UAW plant, and $48 an hour on average for a foreign competitor to make a competing car.

Wil
Indy

By: Chris Phillips

Chris Phillips — Fri, 14 Nov 2008 04:18:36 +0000

Thanks for some very helpful perspective on the Big 3 bailout plans. I agree that a complete rebuild of US auto manufacturing/sales/delivery/service has been sorely needed since the original Chrysler bailout and the days of the infamous K-car. Like the Brits and BL, I suppose we have ourselves to blame for propping up the old model of our industry. We did it with sales of minvans and SUVs for every driveway. We did it by buying artificially cheap oil and by securing artificially cheap credit. The race for battery technology and emergence of visionary, nimble, venture-capitalized enterprises may become an important factor in a rebirth of our passion for things automotive. Oil prices will become the ultimate fertility drug for a rebirth, but I wonder whether our public will have the political stomach to reshape a whole economic sector at a time when the banking and investment sector is already rolled over in the ditch? Holding on to the outdated business models and cultures of our automotive past will be like trying to play Atari games on our Nintendo wii consoles. It’s going to be painful to reboot, but the old game is over. How quickly can we learn the new one?

By: fourwheeldrift

fourwheeldrift — Wed, 12 Nov 2008 19:56:40 +0000

Alan,
There is absolutely no doubt that labor relations and the oil crisis were contributing factors in BL’s financial problems, just as the same conditions plague the Big Three today. Just like GM, Ford and Chrysler, BL helped create the labor problems. One might argue that with the Mini/Minor, BL was better positioned with the oil crisis then than the truck/SUV-heavy Big Three today.

The point of the statement was that labor problems and the oil crisis were only a couple of the factors. Poor quality, behind-the-times design,as well as criminal activity on the behalf of BL and its suppliers (remember those paper gaskets that were really made of sawdust?) also helped to sink BL.

In other words, external factors deserved some blame, but extremely poor management also needed to accept its fair share. (The same is true today, as well.)

By: alan perry

alan perry — Wed, 12 Nov 2008 19:27:06 +0000

“BL executives blamed the economy (including an oil crisis) and labor.”

Are you saying that the oil crisis and their severe labor relation problems were not a major contributor to BL’s problems?