Vote: Should the Federal government bail out the Big Three?

The FED bailing out anyone equates to the “citizens” having to foot the bill for a private corporation who failed to deliver their products in a profitable manner. In years when they made money, did the corporations refund any money to the customers? I doubt it.

As a beleagured tax payer, what return am I going to see on my “investment”? The American auto company executives made poor decisions to put all their eggs in one basket. They took a poorly calculated gamble on making SUV’s, large trucks, and minivans the cornerstone of their business. If the govt. gives the “big three” a bailout, I want to be able to buy any car that I want at employee pricing.

If the auto industry were totally market driven, I would say no to any kind of bailout. The fact is that it’s not. The government is a big part of the problem with regulations such as CAFE and safety standards. Since a major cause of their problems IS the government, I am not opposed to loan guarantees like those that worked for Chrysler back in the 70’s.

Funny, it says there are three comments, but when I click to see them, it says there are no comments…

Anyway, the feds should only step in if there is no other choice *and* there is hope for continued prosperity in the future. No sense dragging out the death if its inevitable. That will of course be balanced against how much it would cost them in welfare if one of the manufacturers went under.

Before any money comes in, all parties must show they are willing to make concessions. That includes the unions agreeing to a pay cut.

No. Chrysler never recovered. Maybe some paper was pushed around to make it look as though they did. If they had recovered then what was Daimler all about? Since then Daimler has run the other way. So what’s the plan? Rescue car companies from their own horribly negotiations with unions. We should have benefits, pensions, healthcare, but it has bleed the big three dry. Let foreign money interject some new life in those dinosaurs. Investment like that would be good for all of us. Federal bailouts are for when the country will suffer as a whole if action is not taken. These three must still have unexercised options. I’m not in favor of throwing good money after bad but we as a nation do. I guess that is why New York is out and London is in.

How many times does the gov’t have to do this before the auto management nitwits get it right.

Instead of fixing known issues they keep reaching for glamor bandaids to gloss things over and in 5-10 years they have the same problems all over again. Cars that can’t compete.

The Japanese Government supplements there auto industry. The Europeans to a certain extent do(VW is partially owned by lower Saxony). Airbus is also governement funded and proud to be so. Citreon for a longtime was government run.

Why can’t our auto industry get a check to offset the huge costs for alternate drivetrains, new and ever changing safety regualtions, CAFE requirements. The hard thing to consider is GM, Ford, Chrysler put there eggs on SUVs here in NA because people wanted them.

GM, Ford and to Chrysler are all pushing for better small and midsize cars. The real problem for them was leveraging there global assets. We should support them.

Well if they don’t help, wouldn’t it be the end of American automakers? I never buy cars from the big three, but doesn’t America need them around?

I certainly don’t want domestic auto companies to go away, but I just see so little momentum to move away from UGLY sedans and gas guzzling trucks/SUVs. Any form of assistance would have to include an air tight plan to offer more vehicles that are needed or even desired?

The problem is that you would have to put together a panel and try to keep in non-political. I don’t think it can be done?

This entire thread just infuriates me that we are even moving in this direction? Just look at the crappy looking cars Ford, GM and Chrysler offer? Oh sure, there are a few bright spots but for the most part, cars like the Taurus, Impala, any Chrysler sedan, Lucerne to name a few, are just plain lousy investments. I just don’t see how this is so difficult? The publlic has made it clear they want cars like the Civic, Accord, Altima, Maxima, Camry. And as far as luxury vehicles go, Ford, GM and Chrysler are DOA.

They won’t change without some kind of motivation.

C

If I get myself into financial issues, who will bail me out?

I hate how people state things that aren’t true. This guy Chuck says that the Civic, Accord, Altima, Maxima, Camry are what people want. He also says that teh big 3 make lousy sedans lol. The fact of the matter is that the Impala has been in the top ten selling vehicles for the last 10 years!

So last month the top ten vehicle also included 3 from Chevrolet. The Impala, Cobalt and Silverado. The Malibu is an excellent vehicle, along with the revamped Taurus who is an excellent vehicle as well. The fact is the Altima, Maxima aren’t even in the top ten selling vehicles and I wouldn’t feel out of line to say that they aren’t what people want.

The Civic and Accord IMHO are design failures. The Civic looks like a wedge and the FE is equivalent to any small car in the domestics inventory, they are however well build vehicles I give them that. The new Accord is also a design failure, I think they threw together alot of design cues from different vehicles. The new Accord sales were actually going down before the upshot in gas prices.

i don’t think everyone understands what a bailout involves. it is not an investment. there is no return. the government would not have a say in the running of these corporations, which no one wants. the axis of the suggested topic turns on whether a bailout will remedy the situation. this is an extreme option to propose without first knowing whether other options have been exhausted. before i’d be on board, as if i had a say, more fat would need to be trimmed from their budgets. the product is what it is and the government has no say in that regard.

I agree with Kyle. Trim the fat first. Bailout should be a last resort with strict guidelines.

From what I understand, the big 3 are hurting pretty bad due to the current management fat (overpaid excess layers of management), the union, and large pension/retirement payouts… am I right? Correct me if I am wrong, I just want to know the facts… someone, please inform us on the real numbers and the viable options!
(Maybe cars.about.com can save the US auto industry. hehe)

Hate to be pragmatic but it comes down to just this.
if (bailout

It saddens me that our auto companies still don’t get it. They ignored the smaller and better cars coming from Asia and Europe 40 years ago, dismissing them as cheap and good only for gas mileage gains. They didn’t give styling or reliability a thought. GM still holds on to car lines which don’t sell (Saab, Saturn, Hummer, etc.). Ford has been dumping losers but tells us that new products are still 2 years away and Chrysler manages to come up with cars which look cheaper but cost more. These are management problems and I resent the huge paychecks and golden parachutes paid to those who have trashed our auto industry. Why is it that the public always has to bail out dumb execs and poorly run companies ? Another S&L or marginal credit bailout plus lousy products. Enough is enough.

Sorry Andre, but the only reason for your numbers is the fact that they sell a ton to rental car companies at slightly over the cost of building the damn things. Rented one last week from Budget. I should have set it on fire rather than let someone else suffer behind the wheel. The other day I was sitting at a light and noticed all the cars around me were hondas and toyotas. There were 5 civics at the light. All I ever see are imports. Let the big 3 fail. Maybe one can figure out a way to survive. But I will NOT buy any of there crap and I damn well will not bail out those union contract monsters until they have a serious change of heart.

Sure bail them out, help them out ..whatever you want to call it. But stop the outsourcing, you want our money, then have American plants do the work. From top to bottom, no outsourcing IT to India, Customer Service to India. Auto plants in Mexico …

Make the phrase Made in the USA true ..if you’re going to use OUR MONEY … oh and the million dollar bonuses … put it in the health care that was PROMISED to the retires.
(btw I’m not a automotive employee in any way)

I could never go along with allowing the goverment to bail out the big three (not really so big any more). When will they ever learn, you can’t build cheap, poor handling cars then pay off the scale union wages and expect people to buy them for the same money that they can get a japanese or european car. Example looking for a 4 door sedan looked at the Ford New Taurus and the BMW 328i by the time I dressed the Ford up the way I wanted it, it was as much as the BMW, but no where near the same car. So why buy the Ford ??

They did it for Chrysler have a clue was lead the charge .there’s no one in original big three that have that kind of leadership and then pay back the money early and paid it all back .if they made quality cars with it by more .if it wasn’t for imports we would still be driving cars like you saw the sixties and seventies .after three years you better get rid of it .

Can’t totally buy the arguement that the Big Three were completely negligent in their building practices over the last 20 years. They built what sold, which was big trucks and SUV’s. Since our economy is market driven, and the market demanded these vehicles, there was no monetary incentive for the Domestic car makers to invest much in smaller more fuel efficient cars.

I also don’t buy the arguement that the domestics are making sedans, etc that nobody wants. If the Domestic car makers made any mistakes here, it was in that they went sedan crazy, making literally everything with four doors. The latest moronic trend is the four-door coupe. I’m waiting for the Corvette sedan personally. I mean, Porsche is supposedly considering a 911 sedan…….

I like traditional sedans (not so-called “sport sedans”), 2 door coupes/sedans and wagons. I apparently happen to be one of the 5 people in America who love the cars from the 60’s, and really enjoy some of the modern retro designs…IF THEY’RE DONE RIGHT (some of which are not-IE: Charger)! Those 60’s designs, many of them anyway, at least had character; a quality that many modern designs lack entirely. The modern retro versions are better quality cars in most cases than their 60’s namesakes.

I don’t care at all for the latest crop of hatchbacks. There is little if any cargo space behind the back seats when they’re in the up position. I have two children still in car seats, so I can rarely put the back seats down for extra storage. I far prefer a separate trunk.

I see the logic in the domestics streamlining and bringing their designs from Europe to the States, that doesn’t mean that I care for the designs.

I never did answer the original question. I want to say “no” because government gets far too involved in things it shouldn’t, and things never seem to go well when it does stick its nose in.

However, that being said, I also feel that the Domestics current situation was caused by a combination of the buying habits of the American consumer in concert with the continuously demanding and frequently stupid regulations of the Federal Government (IE: lower CAFE standards for light trucks).

The Domestic car makers are in business to make money. Can we really blame them for making what most of us Americans wanted to drive, especially when the rules for building them were so much less restrictive and costly? Now the popular response is “let them die for making poor decisions.”

I think we should bail them out. We (consumers and government) put them in the position they’re in. There are enough Americans losing jobs every day with the economy in it’s current slump. I guess a few thousand more Americans out of work will make things even better.

We have heard the nay sayers before when chrysler was given money and paid it back early in fact. Millions of peoples lives depend on the big three here in the U.S we should treat our industry just like Japan , china , russia, canada , england and all the rest of the world does. America can not all be computer geeks some have to work. The car insustry is vital to the U.S Get real and help them survive.

How many jobs would be lost if any or all of these companies fail?

Marcia Purse
About.com Guide to Bipolar Disorder

Any gov’t assist should be in the form of lower corp taxes, and loosening some regulations which may have contributed to the Big Three being less competitive. Open up the market to a more free trade, but restrict executive multimillion dollar salaries and parachutes, and let’s see some of that corporate profit directed into some forward thinking design and engineering. As far as cash grants or loans – I don’t think there is a cash shortage at the big three, it just needs to be redistributed away from the country club and back into the design studio.

I think it’s a little harder then just saying yes or no. I think the government should support the big three, however some things need to be conceded by the auto industry as well. The government needs to stop mandating CAFA standards. The free market will determine what cars are bought and sold determined by how much money people can or want to spend on fuel. I believe everybody knows the unions have destroyed any ability to be competitive by the unwillingness to bargain in good faith. The pay and benefit package’s that have historically been “won” by the mafia influenced AFL-CIO and its counterparts has nailed the coffin shut. If the government agrees to bail out the big 3, the unions need to be dissolved. Of course the unions (socialist organization) are praying for the ability have “change” in office, knowing that he (obama) will work hand and foot to push other socialist ideals, with the ultimate goal of having one happy (UN mandated) world.

I voted Yes for support, but it definitely depends on the type of support. The question is too vague.
And others who commented on the willingness of American buyers to continue buying 12 mpg monster SUVs are exactly right – what happened to the gas guzzler tax? Use that to reduce corporate taxes on a strict temporary schedule! Of chief concern is to safeguard as many jobs as possible, and preserving the economy at the same time.

I would say that any assistance should be in grants for future energy saving technologies to help the big 3 develop vehicles to meet the new EPA requirements. This would be a win win win for the governement, evironment, the companies, and consumers.

RE: MikeD [#17]…
I don’t think we can exclusively make a 100% American car… how can you compete with Mexico’s minimum wage around $5/day? and China is about $5/week! US Laborers for manufacturing and assembly probably won’t work for under $20/HOUR!… and then factor in the unions, etc… We wouldnt be able to afford an American car that was assembled in America from 100% American parts also from American origin,… right?

The Federal government needs to stop bailing out everybody and everything. The “Big 3″ were more concerned with profits and shareholders interests than producing quality vehicles.

Eg. Take a look at the interior cloth headliners of BMW, Mercedes, Honda, and Toyota’s five years later. Chevy, Ford, and Chrysler headliners are typically loose and hanging down. It’s a dumb example, but shows that the Big 3 don’t care about the quality of their products. If I was an exec at the Big 3 I’d be embarrassed that there is such a lack of quality and commitment with the cars and trucks.

I stopped buying Big 3 vehicles long ago and my 1993 BMW has 210,000 miles on it. And no, the headliner is not flapping in the wind…

Who is going to bail out the US Government when our dollar is reduced to nothing? Just my two cents worth.

The feds should not bail out the big three. They have been riding high on big profits due to American consumers not economizing or caring about MPG in favor of horsepower. The EPA has done nothing to improve fuel economy or air quality in recent history. Now it’s the Oil Companies of the US’s turn to reap profits, while the auto industry can’t get rid of land yachts. Too bad, they already made their money. Tell the US oil companies to stop acting like terrorists in our own country. They are trying to force feed the American public in hopes of opening offshore drilling in the US, and to build nuclear reactors and do away with fossil fuel power plants. That should have been done 20 years ago.

The Big 3 need to realize the car business is a global game and use the platforms from their overseas operations just like Renault-Nissan and Toyota. There is no reason Jeep shouldnt be selling cars all over Africa, why GM and Ford shouldnt be selling box trucks in Asia. The USA is 300 million people, the rest of the world is 6 billion – the simple economics is to sell more cars overseas.

I hope the goverment will step in and give my boss some money so that he does’t close the doors next week! Once the gov. starts where does it stop!!!!

We the people can’t afford to bail anyone out.
The automakers have dug this hole themselves,
much the same way I did when farming during
the embargo years and when interest rates were
at 18.5%. No one bailed me out and it took me
years to do it myself but I did it. Pull in
the belts and it can be worked out.

No, we should not bail them out. They are the ones that pretty much put themselves in the hole by making all the trucks,SUV’s Hummers and such. We the public did’nt really have much choice when buying vehicles. This was all their bad choices and they need to learn to bail themselves out just like we have to. Can the government bail all of the US citizens out of debt they put us in? Higher Gas,[government] High food cost[government] Loss of homes[government] High cost of everything else[government] So NO! We as tax payers should NOT bail them out.

NO WAY!!! Since the so-called US Automakers sold out the American auto worker years ago by buying outsourced parts and building assembly plants abroad, while “foreign” companies did the opposite… well, I think that patriotism like that deserves the “Middle Finger Salute”!!!

Andre,

And I hate it when people misrepresent what I say. I was speaking of the design and look of the U.S. cars. I never said they made crappy cars. In fact, I like my crappy GMC and it’s been incredibly dependable. But, the fact is, Ford, GM and especially Chrysler make butt ugly cars that they sell to the car rental giants.

And Andre, compare the resale values of a Honda or Toyota to your “Taurus” or Impala? That alone is an indication of what cars people want to buy.

Let the big 3 go under. I’d be happy driving an Accord, Lexus, Infinity, Toyota, Volvo, Audi, BMW or even a Subaru.

C

Hey, the feds are bailing out investment firms, banks and homeowners that made bad mortgage decisions. Why not help in the restructing of our manufacturing base. If not, we will continue to loose manufacturing in the US and send it all to Mexico because the reason the big three are in trouble is because of the financial decisions made in the 1980’s to keep manufacturing in the US. GM as an example has great cars now, so great, we can not keep any in stock. While the government allows big oil to make huge profits during these “oil” times they are killing the american worker. Why?

Our government spends about a billion dollars on Iraq/Afghanistan every 2 days. The government spends our money on other countries but will not spend dollars to take care of our own country. A sad government we have!!

When those high-profit SUV and PU trucks were selling so well, the Big Three should have put some of those profits away for the inevitable rainy day when the market was saturated or fuel got too expensive. I have no sympathy for them!

The worm always turns! While, foreign companies are providing jobs and are profitable, there will come a time when they will not be profitable and they and the jobs they now provide will leave. Also, the pensions GM, Ford & Chrysler provide are federally insured. If they(GM, Ford & Chrysler) go bankrupt the taxpayers will be stuck with the bill. Remember this is a loan albeit low interest and unlike other government give aways, will be payed back, so there is no real cost to taxpayers. Besides when did the government make any money on investments with our money? Our government has spent half a trillion dollars on the Iraq war. Money that will not be recovered. I don’t think loaning money to these companies is a boondoggle.

I was a Vendor to both Ford & Chrysler for over ten years. During that time I saw them WASTE so much Non-Production materials that at times it made my head SPIN! NO absolutly NOT! They need to pay for all of their mistakes that they made during those good times. I would REFUSE to give them a dime to pay for a total lack of respect to consumers and us as taxpayers!! NO!

I think that they have to. Anyone that lives in the metro Detroit area understands that our economy depends solely on the automotive industry. With the nation’s economy teetering already we can’t allow that many people to lose their jobs. True, many things need to be done, however, instead of thinking of the big CEO’s, maybe some thought should be paid to the thousands of workers that depend on these jobs. And, its not just the people working directly for the Big 3, especially in this area. All of the distributors, contract employees, etc. are all impacted by this.
The government is bailing out Fannie Mae & Freddie Mac…without which people are saying we could be facing times as bad as The Great Depression.

Should The US government bail out American corporations?

Does corporate America share its profits with the tax payers? The answer is absolutely not.
Do they share the profits with the tax payers? The executives are paid millions.
The US Government should bail out all corporations large and small is that right? The answer is no. If it is a viable business, they can raise the money from investors, if not, let them close shop.
If the government decides to bail them out if should be at a cost (like shares in the company) where the government will make money and have a say in running the company. Even better have a public referendum where the voters decide.
Carmakers want money from the government; the financial institutions want money – where does it stop.
It is about time corporate America should learn they have to stand on their own feet. Where is corporate America financial responsibility?
They claim the government is abusing its financial responsibility; it seems Corporate America is no better. They also go to their workers to take a pay cut, is that fair? It seems the little guys are the ones that always pay the price for corporate financial abuse and miss-management.
Other corporations in the world are not asking to be bailed out – they go out of business.
Jay Draiman

The corporate barracudas have no conscience they will step on anyone, stab anyone in the back and fudge the numbers to climb up the corporate ladder and receive the hefty bonuses.
As family values have declined in the last half a century so has corporate integrity and honesty, it seems that corporate America will do almost anything for the buck ($) no holes barred.
What a shame that corporate America has sunk so low.
The government is no different, honesty and integrity is a foreign language, they only serve the special interest groups. (We all know why).
What happened to the American people who placed their trust in the government? (The public officials they voted for).
We are faced constantly with another corporate or governmental scandal of wrongdoing. When is the American public going to wake up and demand an honest government and honest corporate America? Americans wake up before it is too late.
Jay Draiman

Wow good thoughts , I have made my living in the auto industry for many years and have seen lots of things against the consumer. I
love cars its an American thing, most of us are very impressed with them. We are greedy ,
we think you are what you drive and do.
Unfortunetly we have to turn a corner here,
I do not by any means think we should bail them out. The unions have ruined things completely. I think we need to speak up not
sit around this is still America and all the
handouts are killing the middle class

Why not bail out the big 3 automakers, they will get tax cuts etc as will all the other affected industries, but we need to make sure the millions and billions are not padding ceo’s pockets then the average joe like you and me have to split the bill and make some ceo even more rich..

No, do not approve the Bailout

Yes to bailout… there are trickle effects people dont realize. Companies that make nuts bolts screws all the way to seats body frames welding machines rivet guns glue glass for windows lamp assemblies bulbs brake pads rotors wiring… they would be affected.. plus all the people who depend on them to fix their vehicles to get them to work..school buses church buses auto parts… what part would effect you?? All of it would effect me. I dont ride a bicycle or walk to work… maybe some of you do.

I make $12/hr. I lost my previous job at the same salery but a lot more benifits because of the economy. Today I have to drive 25 miles one way to work and I have no benefits. Before, I was able to keep up with credit cards and doctor bills comfortably. Now I am $20,000 in dedbt. I don’t know where the money will come from to pay for my gas to get to work or for my food each week and according to the government I make to much to get government aid. But yet you want to take my tax money and bail out a company that pays there line workers $26/hr. + benifits to make gas guzzling cars that I can never afford. I would think it would be more finacially beneficial to the government to let the companies go under and pay maximum unemployment wages rather than bailing out the companies. this way the government should save a lot of money and the workers will be making more on unemployment then I do working.
I really couldn’t care less about the auto workers who make over double of what I make and make cars only for the rich. I have no pity for them whats-so-ever. I would like to know, who’s going to bail me out?

yes they should help states Mi, oh are in bad shape and Chrysler or G.M going out will not help!! We do not need more forclose homes or more people on the state tab that is ,What would happen. Cut the top 10% of the manage ment pay !! Stop with the big money to people that get billons good or mostly bad of late. The little guys are one heart not them. management.

yes we should states like Mi and Oh are in bad shape and this would not help if Chrysler and G.M went out. There are more then enought people bying kick out of there homes. Put some string on it like the job have to stay in the state they have to put out a small car th people can afford or a small truck that get some milage. Cut back on the top 10% of the pay of management.The small guy on the line is just trying to make it day to day.

I have always purchased American made cars to support workers in the U.S. If the big 3 ar given a bailout, I will NEVER purchase one of their cars again. Their inventory can rot in Detroit.

the big three never kept up with what was going on. If this action continues after bail out, then the need of removal of ceo,s along with giant salary. then the need to force big embargos on europen and asian car makers importing cars into this country. forcing them to employee americans. the tool for real economic domanation.

NO!!!…..America….Do not bail-out the Automotive industry. Look, I have bought 12 new cars in my life. In my younger years, I was a die-hard chevrolet guy because “my father said so”. I lost so much money….especially trading in vehicles that I took care of but were worthless as a trade.
I bought my first foreign vehicle in 1988 and have never looked back. I am very sorry that the US auto maker lost its way. BUT, I am not sorry for their financial problems. They sold me junk and took my money for many years. The executivesof the big 3 are doing just fine. I am tied of crooks riding the backs of workers of this country. I HOPE THEY FAIL….they did the american people wrong and now they want money. I SAY NO WAY!!….thank you

After the oil crisis in the 1970s, the American auto industry pleated that it “needed time to grow strong enough to compete with the imports on the free market” and the Reagan Administration agreed to limit auto imports. The auto industry did not respond with the promised development of more fuel-efficient cars but merely increased its price an average $2,600 per new car and achieved record profits while selling fewer cars than in their record sales year in 1977! (Hudgins, Edward, 1985, The Heritage foundation, The costly Truth About Auto Import Quotas, http://www.heritage.org/research/energyandenvironment/EM74.cfm). This incident indicates that governments have to be more critical prior to interfering as they cannot only hurt consumers but can also ruin international relations with import restrictions.

Despite of this fact, I believe that our politicians in Washington will bailout the American Auto Industries. Why you asked? Because they already sent their lobbyists carrying bags full of money up capitol hill and deposited into those politicians’ campaign contribution funds.

why should the american people help bailout any of the businesses that are failing. They are failing because they did not run them properly to begin with. The auto industry builds inferior products and overprice them due to union labor that is inferior to other companies, but well over paid. The banks and insurance companies miss used their assets/ If they get bailout monies they will use it for raises and bonuses they certainly don’t deserve and they will not fire they big shots that miss led the company to begin with.They will blame the consumer for their problems.

if the big three go . who will build retro cars in the future?

everyone was buying suvs and trucks. toyota trucks and suv have become big. i am missing something i guess?

mr. bush gave 100% tax write off for expensive suvs. he is the goverment. now they should help.

Until the CAW agrees to make measureable concessions to wages and bebefits, there should be no loan or bailout. Everyone else in Canada is suffering cuts to salaries, wages and benefits, and those really unlucky ones don’t have a job. Mr Lewenza and the CAW Union shouldn’t be allowed to maintain the status quo at taxpayers expense. If the government grants these loans without extreme concessions, they will pay for it in the next election, and I am not the only one who thinks this way.