Automaker in deep trouble

[Wt_know]

http://money.cnn.com/2008/11/07/news/compa...sion=2008110716

 

GM, FORD & CHEVROLET, the 3 biggest automaker in US are in deep trouble.

 

What about TOYOTA, HONDA & NISSAN in Japan ?

What about BMW & MERC in Germany ?

 

Are all automakers facing huge losses ? Will car going to be cheaper in 2009/2010

Edited November 13, 2008 by Wt_know

[Xefera]

doubt so, most likely they will cut down on the number of production lines, limit number of models and less investment on R&D

[Shull]

who knows next year..no more GM, ford and chevy..

 

those driving the above 3 brands are driving limited edition cars..

[Kelpie]

There will be a drastic domino effect if GM is allow to fail. I guess the US govt has learnt their lessons well, hence they will probably try to "help" them in certain ways.

 

Regards,

[Lightbringer]

US auto-makers are notorious for their inefficiency and horrible productivity, so no big surprise if they do go under. Read this by Thomas Friedman:

 

Last September, I was in a hotel room watching CNBC early one morning. They were interviewing Bob Nardelli, the CEO of Chrysler, and he was explaining why the auto industry, at that time, needed $25 billion in loan guarantees. It wasn't a bailout, he said. It was a way to enable the car companies to retool for innovation. I could not help but shout back at the TV screen: "We have to subsidize Detroit so that it will innovate? What business were you people in other than innovation?" If we give you another $25 billion, will you also do accounting?

 

How could these companies be so bad for so long? Clearly the combination of a very un-innovative business culture, visionless management and overly generous labor contracts explains a lot of it. It led to a situation whereby General Motors could make money only by selling big, gas-guzzling SUVs and trucks. Therefore, instead of focusing on making money by innovating around fuel efficiency, productivity and design, GM threw way too much energy into lobbying and maneuvering to protect its gas guzzlers.

 

This included striking special deals with Congress that allowed the Detroit automakers to count the mileage of gas guzzlers as being less than they really were -- provided they made some cars flex-fuel capable for ethanol. It included special offers of $1.99-a-gallon gasoline for a year to any customer who purchased a gas guzzler. And it included endless lobbying to block Congress from raising the miles-per-gallon requirements. The result was an industry that became brain-dead.

 

Nothing typified this more than statements like those of Bob Lutz, GM's vice chairman. He has been quoted as saying that hybrids like the Toyota Prius "make no economic sense." And, in February, D Magazine of Dallas quoted him as saying that global warming "is a total crock of [expletive]."

 

These are the guys taxpayers are being asked to bail out.

 

And please, spare me the alligator tears about GM's health care costs. Sure, they are outrageous. "But then why did GM refuse to lift a finger to support a national health care program when Hillary Clinton was pushing for it?" asks Dan Becker, a top environmental lobbyist.

 

Not every automaker is at death's door. Look at this article that ran two weeks ago on autochannel.com: "ALLISTON, Ontario, Canada -- Honda of Canada Mfg. officially opened its newest investment in Canada -- a state-of-the art $154 million engine plant. The new facility will produce 200,000 fuel-efficient four-cylinder engines annually for Civic production in response to growing North American demand for vehicles that provide excellent fuel economy."

 

The blame for this travesty not only belongs to the auto executives, but must be shared equally with the entire Michigan delegation in the House and Senate, virtually all of whom, year after year, voted however the Detroit automakers and unions instructed them to vote. That shielded General Motors, Ford and Chrysler from environmental concerns, mileage concerns and the full impact of global competition that could have forced Detroit to adapt long ago.

 

Indeed, if and when they do have to bury Detroit, I hope that all the current and past representatives and senators from Michigan have to serve as pallbearers. And no one has earned the "honor" of chief pallbearer more than the Michigan Rep. John Dingell, the chairman of the House Energy and Commerce Committee, who is more responsible for protecting Detroit to death than any single legislator.

 

OK, now that I have all that off my chest, what do we do? I am as terrified as anyone of the domino effect on industry and workers if GM were to collapse. But if we are going to use taxpayer money to rescue Detroit, then it should be done along the lines proposed in The Wall Street Journal on Monday by Paul Ingrassia, a former Detroit bureau chief for that paper.

 

"In return for any direct government aid," he wrote, "the board and the management [of GM] should go. Shareholders should lose their paltry remaining equity. And a government-appointed receiver -- someone hard-nosed and nonpolitical -- should have broad power to revamp GM with a viable business plan and return it to a private operation as soon as possible. That will mean tearing up existing contracts with unions, dealers and suppliers, closing some operations and selling others and downsizing the company .... Giving GM a blank check -- which the company and the United Auto Workers union badly want, and which Washington will be tempted to grant -- would be an enormous mistake."

 

I would add other conditions: Any car company that gets taxpayer money must demonstrate a plan for transforming every vehicle in its fleet to a hybrid-electric engine with flex-fuel capability, so its entire fleet can also run on next generation cellulosic ethanol.

 

Lastly, somebody ought to call Steve Jobs, who doesn't need to be bribed to do innovation, and ask him if he'd like to do national service and run a car company for a year. I'd bet it wouldn't take him much longer than that to come up with the GM iCar.

[Spade]

Let them fail! Let them fail!

[Cavver]

then temasek Inc. go buy

[Hishercar]

U I C

 

(u want to die)

 

wait till papa lee sue you for giving bad advice

[Kelpie]

Even once financial powerhouse like LB that acts as advising Bank also can fail lah.

 

Regards,

[Wt_know]

TOYOTA market capitalization is bigger than FORD GM combined.

Kudo to Japanese automaker

Long gone the US automaker empire and here come the JAPANESE

Edited November 14, 2008 by Wt_know

[Watwheels]

3 biggest automaker in US? Very likely since their target audience is on domestic sales and they are not into making small cars for export. They will be hit hard.

 

So will the premium brands. BMW is considering selling their engines to Merc and other interested parties.

 

Japanese makes will survive on selling small and fuel efficient cars. We will see less of new models of big cc luxury cars in the coming year or two.

[Mingsect]

http://money.cnn.com/2008/11/07/news/compa...sion=2008110716

 

GM, FORD & CHEVROLET, the 3 biggest automaker in US are in deep trouble.

 

What about TOYOTA, HONDA & NISSAN in Japan ?

What about BMW & MERC in Germany ?

 

Are all automakers facing huge losses ? Will car going to be cheaper in 2009/2010

 

 

 

look at price of the gm's vehicle

and all their join projects with other automakers

they just make sure got an engine, got suspension and a different name..

it's good to go..

 

their partners at least, spend more time and effort, on design, trims etc..

 

 

 

 

 

 

look at the rest, toyota's hybrid sold like hotcakes in US

nissan's GTR long waiting list. highly sought after in the UK

bmw and merc's prices ...

 

no : they are not facing huge losses, not at the moment

Edited November 14, 2008 by Mingsect

[Wt_know]

GERMANY has gone into 'RECESSION' - the most scare word nowadays

I hope to the BMW-3 & C-CLASS will be cheaper next year and sell at approx $100K+- to woo customers from accord/camry

Edited November 14, 2008 by Wt_know

[Nlatio]

ya possible, when they shift their plant to China.......

Edited November 14, 2008 by Nlatio

[Wt_know]

all BMW-3 are manufactured in South Africa

i believe SA labour cost is much cheaper than China

Edited November 14, 2008 by Wt_know

[Koko]

don you know that BMW and Merc already have production plant in China.... but only for chinese market....

[Nlatio]

maybe shipping from SA to SIN more ex????

 

ya lar, got plant in China, but that's for domestic market.... once they open up a bigger plant for Int'l mkt, cost is sure to fall.... thus cheaper car.... but is it better???? No Idea!!!!

[Wt_know]

i think we need to change the mindset a little bit that lower production cost does not means the consumer must accept lower product quality. it's up to the automaker to innovate and manage their production cost and transfer the savings to consumer (said is easier than done)

Edited November 14, 2008 by Wt_know