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Bailing out the Big-3 Automakers: Your opinion?
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26 / M / California
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Posted 11/19/08
We've known for years that the big-3 automakers (GM, Chrysler, and Ford) have been in trouble due to diminishing sales and their inability to adapt to changing market trends.

However, the Big-3, after seeing how easily the government gave a bailout to banks with loopholes in abundance, they suddenly say that they need 25 billion dollars in emergency aide loans or else they'll be out of money by the end of the year.

Thankfully, our state senators are not a bunch of cocky dumbasses, so they've been scolding and ripping apart the big 3 top brass since day one of the plea meeting.

Supporters of this bailout have been throwing around a statistic that the auto industry supports one in ten jobs in the US, and that if we don't help these guys out, the whole industry will collapse.

Realistically, the statistic is a 2003 study by the "Center for Auto Research" on the 'economic contributions of motor vehicles to the US economy'. The study concludes that "new vehicle production sales, and other jobs relat3ed to the use of automobiles, are responsible for one out of every 10 jobs in the US economy". the term 'responsible for' is actually insanely broad and includes jobs in steelwork, glass and electronics, as well as company expenses. *cough-privatejets-cough*

Also, the study on auto-related jobs accounts for ALL automakers, from Audi and Ferrari to Toyota and Volvo.

It in no way states that this statistic is ONLY for the big three.

Now with that aside, I'm strongly against the bailout as a lot of people are.

What was it that caused this failure? The big 3's decisions themselves.

First of all, they had the opportunity to invest in hybrid and alternative-energy-consuming vehicles. They laughed at the idea while continuing to build and release newer SUV's and trucks... interestingly enough, even with this huge economic crisis to date, they are still releasing a new Hummer truck as well as a newer fleet of SUV's.

Remember the firestone tire failures? That practically destroyed them for good. Firestone is only partially to blame. The big one was Ford, because they demanded that Firestone build a tire setup to their designers' specifications and not to that of what Firestone deemed both safe and acceptable.

I've also heard people argue that the American public wants cars that have good horsepower and that such a thing is something japanese and euro automakers can't provide.

C'mon, we ALL know that isn't true. You can buy a used Japanese car for a couple grand, invest a couple grand into a turbo or supercharger or hell even a few minor internals kits, and you've got yourself a car that's fast and yet is still cheaper than buying anything the big 3 can put out.

Even when they went up to the senators with their pleas, the big 3 didn't even have a plan or even a spreadsheet of exactly how much they need and for what reasons. That proves they don't NEED the money, but are merely looking for a new freebie.

So once again, my opinion is that they shouldn't get the money and if the big 3 will end up closing down for good, then let them. It's survival of the fittest and they are now reaping what they sowed.

What's your guys' opinion on all this?
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Posted 11/19/08
Not a chance. You cant ask for bail out money when you messed on your own company. Also they travel in private jets and expensive cars yet they have the balls to ask for bailout money.
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24 / M / Toronto, Ontario
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Posted 11/19/08
im not a big fan of nascar but u have to see that if the big 3 go out of business nascar will pretty much be gone cuz all they got left is toyota... and nascar is the biggest american entertainment which would be funny if it was japanese run xD HAHA

but ya TBO id say fuck that the big 3 should pay for there mistakes it was there choice to make SUV's and trucks while the BIG crisis this summer went on. They should just pay there dues and move on even if that involves going out of business, its not like they made anything THAT great anyway no offense to there cars.... but they just aim there cars at bargen hunters now they dont even make anything adaquite for there buyers anymore.

so all in all, i dont think they should get bailed out. besides if the bailout goes thru for them there gunna end up getting 100+million for nothing and just gunna burn it all again at there own expense....
if they havent started picking themselfs up yet, chances are they wont later. ESPECIALLY if they get a large sum of money to cover all there expenses...
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28 / M / Houston, Texas
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Posted 11/19/08
Who cars about Ford and Chrysler but GM make some pretty good cars. I dont think none of them need money.
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M / Nowheresville, MI
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Posted 11/19/08 , edited 11/19/08
Sure, why not? Didn't we bailout the mortgage industry despite their the fact they're largely responsible for their situation? The big three are just looking for their cut of "corporate wellfare" like what the banking folks got. They'll survive this.
This is going off topic, but kinda related. I find it interesting how the republicans don't support the big three bailout, but where all for the mortgage bailout. I'm sure they have their reasons(automakers didn't give enough to republican election campaigns?) and the democrats support it because so many of their constituents are employed by automakers (ie. union workers)......
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25 / M / San Francisco, Ca...
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Posted 11/19/08
I need to bailout. Just give me that money, I'll just bailout this economy by me spending it by making roads like the Nurburgring Nordschleife all over America.

OR give that money to families who owe large amounts on home loans or other loans to be paid off, so they can start financing in other things. Were in this mess cause investors sold most of their stocks and keeping it for themselves. People should just start spending and paying things back and just freeze interest rates at 2% for a year or half a year. After that, people can get jobs again.
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22 / F / Nebraska
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Posted 11/20/08
I'm personally against the bailout.
I mean, when they're generating profit, no company wants government intervention. But as soon as they can't succeed on their own, they're on their knees begging for it.
Forget that, the idea of capitalism is that if you can't succeed as a business yourself, you're not fit to be there. Their problem as a company is not miss management but rather they couldn't adapt to the changing economy.
Besides, for every company that fails, another will take its place. The end of the big 3 does not mean the end of the domestic car market.
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Posted 11/21/08 , edited 11/21/08
Ford, Chrysler and GM have all been exhibiting weak sales, especially GM. These morons never considered the idea of hybrid cars or alternative energy sources which resulted in the decrease in demand of their cars. The economy is at the point of slump, no one has the money to afford high fuel consumption vehicles, which is why they decide to visit their local Toyota/Honda dealers for their car. This is their fault for their current situation. Even though they are starting to take into account the hybrid/fuel efficiency issues, it is already too late. They never gave consumers the idea that their cars/trucks are fuel efficient until they are in trouble. It will take a while before consumers realize their cars/trucks are fuel efficient, but by the time it passes the recognition lag, their company should be bankrupt.

As much as I would like to say "no" to the bailout, I would have to say "yes" to it. Although their situation is caused by their unwillingness to explore new ideas, we also have to remember that much of their investments are within North America. The current economic crisis continues to ripple across the world because everyone has lost confidence in large corporations. This decrease in confidence causes us investors to pull out all our investments because everyone else is doing it ("bull rush effect"), and no one dares to turn back. This is why Warren Buffet says "be greedy when others are fearful, be fearful when others are greedy". He is one of those investors that actually turns around and looks at the situation than to follow the crowd. By doing so, he will suffer losses in the short run, however when investor confidence returns, these investments will BOOM. As for the bailout, if there is no bailout, MANY people will lose their jobs, and therefore consumption decreases dramatically, demand decreases and once again... this will ripple across America like the Wallstreet crisis.

Moreover, all the unemployed workers will be coming to the government claiming UI (unemployment insurance). With that in mind, the government HAS to pay out money anyway, and in the long run, if they continue to be unemployed, our government is in for one hell of a ride.

In addition, for those who think that without the Big 3 America will survive, I disagree. Sure Honda/Toyota will invest by building new plants, however that is only if they see profitable to invest in a plant in America. In addition, it depends where they see fit to invest. They would invest to take advantage of the shipping costs, however since no one has money to buy things, why would they invest? In my area (Toronto), Honda is giving away $7000 rebates on vehicles to draw customers. Sales aren't doing that great even in a major city like Toronto, what makes you think they will open back plants in the Detroit area? Moreover, by the time they invest in new plants, they have to look for workers, train workers, etc. to the point where this time lag will cause America to lose so much money from UI & decreased consumption that it can't recover.

The only problem with the big 3 right now is that they have NO plan whatsoever to go along with the bailout. So until then we can say no, but if the plan is seen reliable, we have to give it a go. Without investors confidence, the only power large enough to turn back the economy is the government, and if the government doesn't help them, they are over. With the bailout, we can give them more time to regain consumer confidence and hopefully by then the economic crisis will be over. At least the bailout will save the economy for a while.

BTW the corporate executives can flaunt their money driving fancy cars and riding in planes/helicopters b/c the company is required to give them those benefits. When they leave the company, they get a huge severance pay, so regardless of whether or not the company goes bankrupt, they get A LOT OF MONEY.
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Posted 11/21/08

TheTsukiyomi wrote:

Ford, Chrysler and GM have all been exhibiting weak sales, especially GM. These morons never considered the idea of hybrid cars or alternative energy sources which resulted in the decrease in demand of their cars. The economy is at the point of slump, no one has the money to afford high fuel consumption vehicles, which is why they decide to visit their local Toyota/Honda dealers for their car. This is their fault for their current situation. Even though they are starting to take into account the hybrid/fuel efficiency issues, it is already too late. They never gave consumers the idea that their cars/trucks are fuel efficient until they are in trouble. It will take a while before consumers realize their cars/trucks are fuel efficient, but by the time it passes the recognition lag, their company should be bankrupt.

As much as I would like to say "no" to the bailout, I would have to say "yes" to it. Although their situation is caused by their unwillingness to explore new ideas, we also have to remember that much of their investments are within North America. The current economic crisis continues to ripple across the world because everyone has lost confidence in large corporations. This decrease in confidence causes us investors to pull out all our investments because everyone else is doing it ("bull rush effect"), and no one dares to turn back. This is why Warren Buffet says "be greedy when others are fearful, be fearful when others are greedy". He is one of those investors that actually turns around and looks at the situation than to follow the crowd. By doing so, he will suffer losses in the short run, however when investor confidence returns, these investments will BOOM. As for the bailout, if there is no bailout, MANY people will lose their jobs, and therefore consumption decreases dramatically, demand decreases and once again... this will ripple across America like the Wallstreet crisis.

Moreover, all the unemployed workers will be coming to the government claiming UI (unemployment insurance). With that in mind, the government HAS to pay out money anyway, and in the long run, if they continue to be unemployed, our government is in for one hell of a ride.

In addition, for those who think that without the Big 3 America will survive, I disagree. Sure Honda/Toyota will invest by building new plants, however that is only if they see profitable to invest in a plant in America. In addition, it depends where they see fit to invest. They would invest to take advantage of the shipping costs, however since no one has money to buy things, why would they invest? In my area (Toronto), Honda is giving away $7000 rebates on vehicles to draw customers. Sales aren't doing that great even in a major city like Toronto, what makes you think they will open back plants in the Detroit area? Moreover, by the time they invest in new plants, they have to look for workers, train workers, etc. to the point where this time lag will cause America to lose so much money from UI & decreased consumption that it can't recover.

The only problem with the big 3 right now is that they have NO plan whatsoever to go along with the bailout. So until then we can say no, but if the plan is seen reliable, we have to give it a go. Without investors confidence, the only power large enough to turn back the economy is the government, and if the government doesn't help them, they are over. With the bailout, we can give them more time to regain consumer confidence and hopefully by then the economic crisis will be over. At least the bailout will save the economy for a while.

BTW the corporate executives can flaunt their money driving fancy cars and riding in planes/helicopters b/c the company is required to give them those benefits. When they leave the company, they get a huge severance pay, so regardless of whether or not the company goes bankrupt, they get A LOT OF MONEY.


Ford received a little bailout money a while back. You know that they did with it? They advertised a 2010 Ford F150.
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Posted 11/21/08 , edited 11/21/08

Ford received a little bailout money a while back. You know that they did with it? They advertised a 2010 Ford F150.

Really? Thats not good...

On the brighter side Ford introduced 2 new Hybrid sedans, the 2010 Ford Fusion Hybrid and the 2010 Mercury Milan Hybrid.

2010 Ford Fusion Hybrid



2010 Mercury Milan Hybrid



The City Fuel Economy of Ford's Hybrid twins is 39 MPG, thats around 6 MPG better than its main competitor, the Camry Hybrid.

I understand why many people in North America don't like Ford.
Most of their recent mainstream models have been so-so and of course those useless gas guzzling trucks (same goes for GM and Chrysler)

Ford models outside North America are much better (styling, build & quality) specially the new global models (Fiesta, Euro Focus, Mondeo) which are all developed by Ford of Europe (who is in much better shape than Ford of America).

By 2013 small and medium Fords in the US will be the same as the European developed (global) models starting with the sub-compact Fiesta which goes on sale early 2010 in the US.

All this trouble could have been avoided if Ford acted earlier by bringing in the better euro developed models.
It was only when Alan Mulally became CEO of Ford in late 2006, that they considered adopting Euro Ford models.



Now with GM...
GM's solution to survive might be the 2011 Chevy Volt plug-in electric car. Now the big question? Will GM last long enough to build it?




Chrysler? They released electric concepts based on their Dodge Minivan and Jeep Wrangler, the other model was an electric Lotus Elise badged as a Dodge? Hmmm... I also wonder if they will last long enough to build or sell any of these vehicles.


RossoCorsa wrote:
What's your guys' opinion on all this?

As of this moment... I'm for the bailout because millions of people will loose their jobs if these companies and their suppliers go down.
When you let the parent company die there's a big chance it will drag down its divisions around the world (even if they are doing well).
That means aside from the millions of jobs that might be lost in the US, millions of jobs could also be lost in their other plants around the world.

Its tough... some people say "Let the big 3 go down so they will learn their lesson" of course another way to say this is "let millions of people loose their jobs so the big 3 will learn their lesson".

Lets wait and see...
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Posted 11/21/08 , edited 11/21/08

veyron1001 wrote:

Ford received a little bailout money a while back. You know that they did with it? They advertised a 2010 Ford F150.


thats why i said that they would have to come out with a reliable plan before we accept the conditions, afterall the government can keep surveillance over their projects.

BTW obviously they would want to advertise their products, i dont see whats the problem with advertising the F150. You need your customers to notice your products afterall, if they dont... who is there to know you even improved your car or whatsoever? However if they excessively advertised 150 and did not spend any bit of it on r&d then thats bad. But i dont see that, Ford has been coming up with hybrid and fuel efficient cars, so obviously they're doing something more than just advertising the 150. Dont base everything on one or two things.

The point of the bailout is not really saving the companies, its saving the companies so the economy doesnt worsen up because of all the unemployed workers. The bailout comes down to giving the unionized workers a chancer of survival (fuk unions, they cost too much, lower salary!!!!)
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Posted 11/21/08

TheTsukiyomi wrote:

The point of the bailout is not really saving the companies, its saving the companies so the economy doesnt worsen up because of all the unemployed workers. The bailout comes down to giving the unionized workers a chancer of survival (fuk unions, they cost too much, lower salary!!!!)


I completely ageree with The Tsukiyomi. Seriously can you imagine the consequences of letting The Big 3 hit the bucket? We're talking thousands...no hundereds of thousands of jobs would be almost instantly lost. The United States cannot afford something of that magnitude to happen. Especially with the weak dollar...it would result in something far worse than the great depression.

However, this bail out must be with conditions. If these companies are not able to clean up their acts within a certain time and if they should be in the red again..they really should be left out to dry. I know it sounds selfish but the government cannot afford to waste billions or possibly trillions of dollars constantly rehabilitating companies that should not need the bail out in the first place. As for the casualties of this condition, the government can give that money to other promising companies so as help those unemployed find jobs.


As for the CEOs..well a probe should be in effect as to how each respective company was run and if there is any sign of foul play...they should be punished severely.

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Posted 11/21/08

thanos369 wrote:


TheTsukiyomi wrote:

The point of the bailout is not really saving the companies, its saving the companies so the economy doesnt worsen up because of all the unemployed workers. The bailout comes down to giving the unionized workers a chancer of survival (fuk unions, they cost too much, lower salary!!!!)


I completely ageree with The Tsukiyomi. Seriously can you imagine the consequences of letting The Big 3 hit the bucket? We're talking thousands...no hundereds of thousands of jobs would be almost instantly lost. The United States cannot afford something of that magnitude to happen. Especially with the weak dollar...it would result in something far worse than the great depression.

However, this bail out must be with conditions. If these companies are not able to clean up their acts within a certain time and if they should be in the red again..they really should be left out to dry. I know it sounds selfish but the government cannot afford to waste billions or possibly trillions of dollars constantly rehabilitating companies that should not need the bail out in the first place. As for the casualties of this condition, the government can give that money to other promising companies so as help those unemployed find jobs.


As for the CEOs..well a probe should be in effect as to how each respective company was run and if there is any sign of foul play...they should be punished severely.


Its not like they are going to demolish the factory after the failing 3 go bankrupt. The bigger auto companies will just buy them out.
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Posted 11/21/08 , edited 11/21/08

veyron1001 wrote:


thanos369 wrote:


TheTsukiyomi wrote:

The point of the bailout is not really saving the companies, its saving the companies so the economy doesnt worsen up because of all the unemployed workers. The bailout comes down to giving the unionized workers a chancer of survival (fuk unions, they cost too much, lower salary!!!!)


I completely ageree with The Tsukiyomi. Seriously can you imagine the consequences of letting The Big 3 hit the bucket? We're talking thousands...no hundereds of thousands of jobs would be almost instantly lost. The United States cannot afford something of that magnitude to happen. Especially with the weak dollar...it would result in something far worse than the great depression.

However, this bail out must be with conditions. If these companies are not able to clean up their acts within a certain time and if they should be in the red again..they really should be left out to dry. I know it sounds selfish but the government cannot afford to waste billions or possibly trillions of dollars constantly rehabilitating companies that should not need the bail out in the first place. As for the casualties of this condition, the government can give that money to other promising companies so as help those unemployed find jobs.


As for the CEOs..well a probe should be in effect as to how each respective company was run and if there is any sign of foul play...they should be punished severely.


Its not like they are going to demolish the factory after the failing 3 go bankrupt. The bigger auto companies will just buy them out.


Dude, the problem is that the auto sector got hit hard in the past decade. 1st, unions wanted raise in their salary, 2nd the oil shortage (lmao, that was a joke, they just wanted to force us to develop alternative fuel), 3rd the wallstreet credit crunch owned everyones wallets. Cars are a luxury people would first dispense with because it is the least worthy investment (lose so much value once it hits the road). The auto industry wont survive if this continues. Larger auto companies? GMC is the largest there is, only Toyota has more sales than them, but under the current economic crisis, NO ONE IS BUYING CARS. Why would Toyota invest in Canada or the States when they dont even rake in money? This is not a case of adaptation where the strongest live and weakest die off. We are talking about the effects of them dying off. LOSING THOUSAND AND THOUSANDS of jobs, which further worsens the economy as MANY of them are probably living paycheque to paycheque.

The bailout must be controlled by the government just like the $700 billion wallstreet bailout so that none of the money would be put to waste.
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31 / M / Texas
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Posted 11/22/08

First of all, they had the opportunity to invest in hybrid and alternative-energy-consuming vehicles. They laughed at the idea while continuing to build and release newer SUV's and trucks... interestingly enough, even with this huge economic crisis to date, they are still releasing a new Hummer truck as well as a newer fleet of SUV's.


Yes I totally agree that while the Japanese and even the Korean's were selling shitloads of small, cheap cars the big three screwed themselves by refusing to put more money in that market and continue to make big ass SUV's right into the 11th hour. But now I think the Suburban is dead right? I think people are starting to wake up and realize how ridiculous these SUV's are. I heard something like a Honda SUV had more space than a Suburban while being much smaller overall. It's that kinda shit that that gives everyone the perception that Americans are only good at making work trucks. Every other kind of car the Japanese do better.


I've also heard people argue that the American public wants cars that have good horsepower and that such a thing is something japanese and euro automakers can't provide.

C'mon, we ALL know that isn't true. You can buy a used Japanese car for a couple grand, invest a couple grand into a turbo or supercharger or hell even a few minor internals kits, and you've got yourself a car that's fast and yet is still cheaper than buying anything the big 3 can put out.


Agreed. Most people leave their cars completely stock, so they could care less about power. All they care about is the ride quality. Look at Kia's and Smart's sells figures compared to that of all Chrysler's big Hemi powered beasts and that's proof enough that most Americans don't care about horsepower. it's a shame the big three never figured this out.


Even when they went up to the senators with their pleas, the big 3 didn't even have a plan or even a spreadsheet of exactly how much they need and for what reasons. That proves they don't NEED the money, but are merely looking for a new freebie.


Yes if you ask me all they did was make me NOT want to give them a fucking penny. Their private jet's flight alone cost around $20k each. If you still have cash to waist like that you don't deserve any money from me. We already bailed the automakers out once way back and now we shouldn't have to do it again. Even if they do die I don't think all the jobs will be lost. There are plenty of smaller, foreign car company's that would LOVE to get into the American market and a good way to do it is to purchase something like Dodge and use the name recognition and infrastructure to get in.


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