The Carmagedonn Thread: FCA and "Consolidation"

[Joey D]

I agree, I don't think it was intended to help them out of the mess. I think it was to little to late, the government should have either properly bailed them out or let them go bankrupt. All the government did was waste a ton of money.

And if GM and Chrysler ever pay back that money I will eat one of their cars. They are supposed to pay it back but I forsee the government "forgiving" the loan which is lamer that FDR's legs...ZING! (to soon )

 

[ROAD_DOGG33J]

Care to elaborate?

You're only looking into the automotive industry, which makes your portfolio quite risky. You will be affected by whatever happens in that industry. Plus they compete against each other. So if one company does good, that might mean that others you have invested in will do worse.

 

[YSSMAN]

You know, that same government, upon taking office, said that they had no interest in buying up American companies. I believe that one Barack Obama specifically said that he had "no interest or intention of running GM." Then a month later he forced the CEO of GM out of the company. Then he helped push through higher CAFE standards a month after that. So, yeah.

Hindsight is 20/20, and if we knew bankruptcy would have been a better option at the time, chances are that we would have taken it. Its really as simple as that. There are a lot of variables that go into the problem, some that perhaps could have avoided this situation altogether - but instead we ignore that and complain about how the government does this, or that, or how they should have done it this way, but certainly not that way. I can't blame the government for attempting to do what had worked before... But I can certainly complain about how they dragged their feet on actually addressing the problem in a sufficient amount of time.

As for Wagoner, he had to go, regardless of the White House pushing for it or not. It was under his watch that the company collapsed, he had no place in the company any longer. The CAFE Standards are pretty much the same story, where we knew it would be passed when executive power rolled over. At least it levels out the standards that must be met. Something made sense for once.

 

[Tornado]

Hindsight is 20/20, and if we knew bankruptcy would have been a better option at the time, chances are that we would have taken it. Its really as simple as that.

See: The second post in this thread.

I can't blame the government for attempting to do what had worked before...

What, when the British government did it? The Chinese are really happy with how that turned out.
Seriously, I don't know what you are going for there. When has it ever worked before?

 

[JCE]

You're only looking into the automotive industry, which makes your portfolio quite risky. You will be affected by whatever happens in that industry. Plus they compete against each other. So if one company does good, that might mean that others you have invested in will do worse.

You're right, I am only putting my money in the automotive industry. And I'm doing it because I want to. I only expect to keep these for 30 years or so. And I don't really care if I buy into competing companies. 👍

 

[ROAD_DOGG33J]

You're right, I am only putting my money in the automotive industry. And I'm doing it because I want to. I only expect to keep these for 30 years or so. And I don't really care if I buy into competing companies. 👍

But if the automotive industry crumbles, then you're out of your money.

 

[Keef]

I can't blame the government for attempting to do what had worked before... But I can certainly complain about how they dragged their feet on actually addressing the problem in a sufficient amount of time.

The problem is that the government did anything at all, and I'm not just talking about currently. I'm talking about years long passed. This stuff has been covered extensively in the Opinions forum, eh, about how pretty much all these problems can be pinned directly to the government?

As for Wagoner, he had to go, regardless of the White House pushing for it or not. It was under his watch that the company collapsed, he had no place in the company any longer.

Whether it was his time or not that's absolutely no excuse for the government's overstepping their bounds and controlling the actions of a private business. If it was his time to go, the board at the company would have ousted him. If they didn't, the company would have failed and they'd have all learned their lessons.

The CAFE Standards are pretty much the same story, where we knew it would be passed when executive power rolled over. At least it levels out the standards that must be met. Something made sense for once.

It's my view that these standards the government comes up with are ridiculous. They're one of the reasons all car companies are having so much trouble, because of the development costs required to meet these standards that have absolutely zero impact on the environment. In fact, looking at the big picture they might actually hurt the environment, because of all the extra work that has to be done on the front end; design, development, tooling, machining, manufacturing, advertising, etc., of entirely new products specifically to meet these standards. If someone out there wants to do a study, I'll bet you my bank account that all this enviro-bullcrap going on these days is actually worse, because everything has to be changed in order to comply. If doing it once caused pollution, then doing it twice causes twice as much, and don't give me some "in the long run" junk, because these standards change every 5 years. There is no "long run".

 

[Jim Prower]

But it makes Voters feel good, and keeps those who "know better" in office. Everyone's happy. Penniless, but happy.

 

[Philly]

But it makes Voters feel good, and keeps those who "know better" in office. Everyone's happy. Penniless, but happy.

If everyone's happy, then CAFE is making the tree hugging liberals here in Seattle overjoyed. Hell, I just read an editorial today praising CAFE because it means that the government is finally trying to step in and advance things. And then it went on to criticize GM for building bigger cars in the face of, and ignoring, higher gas prices and CAFE.

D'oh!

Do people not realize that companies build SUVs because there is a market for them, and they make money? That's simple business. And if all the happy go lucky Prius drivers want to be all cocky about their car and their brand, I'd suggest they take a look at the newest Sequoia, Land Cruiser, 4Runner, Tundra and Lexus thing before they criticize GM. or especially the FJ, which basically is the same principle as the universally hated HUMMER.

 

[Jim Prower]

Doesn't stop the general public from being sheep. I think disaster movies with climate change and crap give people the wrong idea of what's going on. Besides, most people will admit that "There's nothing wrong with being more green."

 

[Keef]

If they want to be more green they should eat a salad and lose some frickin' weight. That extra hundred pounds some of these people are lugging around is really hurting their gas mileage.

 

[Joey D]

Isn't that the truth? Make cars lighter and boom there you go, instant fuel savings. Light weight materials, carbon fibre, etc. is the way to go for sure, and if the whole auto industry did it, it wouldn't be nearly as expensive to produce.

 

[Keef]

You don't even need all those fancy materials to do a decent job at a lightweight car, all you need is less of what you have now. We already know how good of mileage modern diesels get...so combine that with a car that weighs 500 pounds less! All this extra metal they're using to stiffen the chassis, meet these crash regulations, all this safety stuff, all this new hardware that's supposed to be "green", all this crap, take it all off, save 500 pounds, gain 10 miles per gallon on the highway.

Simple as that.

Ah, there you go, that's another point. Everyone wants to be green and reduce emissions, but have they ever thought about what it takes to manufacture a car these days? The amount of material dedicated to simply making the chassis stiffer and safer is probably mind blowing compared to the amount of steel used 10 or 15 years ago. And it's the reason cars weigh so much more than they did back then. None of it is necessary. My Del Sol didn't even have a chassis relative to modern cars, and it weathered an impact with a car a half-ton heavier just fine. None of it is necessary. Get rid of it, save material, save weight, save money, save fuel, save emissions, problem solved.

 

[JCE]

I agree with pretty much everything that Keef has said. Pretty much sums it up.

 

[YSSMAN]

Seriously, I don't know what you are going for there. When has it ever worked before?

I was thinking of the Chrysler bailout in 1979-1980, which "saved the company," brought us the K-Car, made Iacoca a God, gave the Fed an extra $350 million (while paying it off years in advance), and as you (and others) constantly point out - made Chrysler arguably the best American car company on into the late 1990's.

That's where the loan idea worked.






All of the more conservative views of what happened are legitimate in their own ways, and in some respects, I do agree with some of you on those points. But, I'm not certain if the same feeling of "WTF?" can be conveyed when there is such an apocalyptic clash of emotion, politics, economics, and ultimately reason that is effecting us here in this state.

I'm frustrated - simple as that. My favorite company is in the toilet and I'm thinking about buying a Ford. CLEARLY something went wrong on multiple levels.





RE: CAFE and Weight Loss

No major arguments from me, really. I don't like CAFE standards, and I've spoken to it before. Its sad that in this country, we have to legislate fuel economy, where instead in every other market of the world, its a race to the top to increase it. I'd have thought the gas shocks last year would have people continuing to re-consider, but it is not the case. Perhaps these current spikes will attempt to drive that back home. Until the market demands more fuel efficent vehicles, on a consistent basis (I'm looking at you "middle/real America"), things won't change much.

My guess is that the new CAFE demands, in addition to some new calls for new-car-buyers to produce lightweight, spunky sports sedans and coupes will spur some level of weight and size reduction in cars to come. We've already seen that Ford and Mazda, as well as Nissan, get the picture. Perhaps, eventually, Honda and Toyota will too. I'd love to be able to go out there tomorrow and pick up a 2400 lb hatch with a 135 BHP 2.0L I4 again. Maybe someone will deliver... Someday.

 

[JCE]

I'd love to be able to go out there tomorrow and pick up a 2400 lb hatch with a 135 BHP 2.0L I4 again. Maybe someone will deliver... Someday.

How's 2.0L I4, 140bhp and 2,588lb?

Your problem is solved. And at less than $16.000 for an SE and $17,500 for an SES model with some extra kit its good value too. Plus in that trim in the pic above is actually pretty neat. I like the darker colored grille, it detracts away from its hideousness.

 

[Keef]

How's 2.0L I4, 140bhp and 2,588lb?

Really? Really? So you're telling me the company that makes the "purest" hot hatch in the country is...Ford?

Well, wait until the new Focus chassis reaches our shores. You'll wish it was that easy to gain +200 in the RPGs you play. But in the mean time, go Ford. Hell yeah. That Focus is over 200 pounds lighter than a new Si.

 

[harrytuttle]

It's my view that these standards the government comes up with are ridiculous. They're one of the reasons all car companies are having so much trouble,

You mean it wasn't that they made bad deals with the unions over the years requiring them to pay people who weren't working? Or do you mean that it had nothing to do with slowing sales? Maybe we're deciding not to talk about GMAC's failure. It can't be any of that. It couldn't possibly be their own fault. There's no way 40 years of pretending to be blind and deaf could ever cause anything to go wrong.

because of the development costs required to meet these standards that have absolutely zero impact on the environment. In fact, looking at the big picture they might actually hurt the environment, because of all the extra work that has to be done on the front end; design, development, tooling, machining, manufacturing, advertising, etc., of entirely new products specifically to meet these standards.

Perhaps the guy who's 100 lbs. overweight shouldn't try to lose weight because he runs the risk of having a massive heart attack on the treadmill. That's true; he might. Staying 100 lbs. overweight, however, guarantees him an early death, though, and a life of diabetes, various intestinal problems, skin 'issues'...all sorts of lovely stuff. There's also the fact that his current condition makes that fearsome heart attack all the more likely.

In case that analogy flew over your head (as over 100 years of research and documented health and environmental hazards apparently have), legislation such as this has eliminated lead and (soon) benzene in fuels. Was this a bad thing? Was the substantial investment in changing the way engines consumed fuel worth the time? Do you think it's possible to see a blue sky during rush hour in Los Angeles? Do you think we should bother? Or maybe we should just forget it. A meteor's bound to hit and destroy the earth sometime in the next few thousand years. Best not to waste time worrying about the air we breathe today.

If someone out there wants to do a study, I'll bet you my bank account that all this enviro-bullcrap going on these days is actually worse, because everything has to be changed in order to comply. If doing it once caused pollution, then doing it twice causes twice as much, and don't give me some "in the long run" junk, because these standards change every 5 years. There is no "long run".

The standards change "every 5 years" because new information is learned "every 5 years". Would you prefer we bury our heads in the sand and be content knowing that we don't have to spend more money? Would you be happier with lead-burning, carburetted, 12-miles-to-the-gallon, 3,500 lb., no-seat-belt having, drum-brakes-only, manual-steering behemoth rather than...whatever you drive now? Those changes appeared over time, not all at once. There are many approaches to improving a car. Not "everything" has to be changed at once, and this current legislation hardly requires such action. Your myopic view of things would leave one to believe either that you are uninformed of the actual situation, or willfully ignorant. In any event, your resistance to any form of improvement mirrors the same attitude American car companies have had since the 1960's. Where are they now?

 

[Bones Brigade]

In case that analogy flew over your head (as over 100 years of research and documented health and environmental hazards apparently have), legislation such as this has eliminated lead and (soon) benzene in fuels. Was this a bad thing? Was the substantial investment in changing the way engines consumed fuel worth the time? Do you think it's possible to see a blue sky during rush hour in Los Angeles? Do you think we should bother? Or maybe we should just forget it. A meteor's bound to hit and destroy the earth sometime in the next few thousand years. Best not to waste time worrying about the air we breathe today.



The standards change "every 5 years" because new information is learned "every 5 years". Would you prefer we bury our heads in the sand and be content knowing that we don't have to spend more money? Would you be happier with lead-burning, carburetted, 12-miles-to-the-gallon, 3,500 lb., no-seat-belt having, drum-brakes-only, manual-steering behemoth rather than...whatever you drive now? Those changes appeared over time, not all at once. There are many approaches to improving a car. Not "everything" has to be changed at once, and this current legislation hardly requires such action. Your myopic view of things would leave one to believe either that you are uninformed of the actual situation, or willfully ignorant. In any event, your resistance to any form of improvement mirrors the same attitude American car companies have had since the 1960's. Where are they now?

👍

All I can think to add is a quip about the free market and how going unregulated would be similar to a government without checks and balances. Freedom isn't free? My thoughts transcend just the car industry so all I will say to stay on topic is that Mr. Tuttle is spot on.

 

[Philly]

Going back a little bit...

Oh, and from the thread title, as a general question:

"Where do we go from here?"

I bit the bullet and read Micheal Moore's article hooting and hollering about the bankruptcy. Looking past all the haterade and way out there stuff, I think he actually has some pretty good ideas there. Is that bad?

In all seriousness, what do we think about the government taking over some of the Big 3's idled plants and putting them to work building the government's dreams of all this clean energy stuff they want? There is no need to take over plants that are still running, as they are actually being useful. but idled ones aren't. And the government already owns the company, so they're just grabbing stuff from themselves. Plus GM owes them stuff anyway.

It'll cost a little bit, yes, but we will get a greener infrastructure from it and employ all those that are losing their jobs over there in Michigan.

 

[Joey D]

Michael Moore's article did touch on a couple of things that would be good but a couple that wouldn't really work. I like that he wants to promote energy efficient public transportation and use the laid off workers to build up the network needed. You solve two problems right there, the country will be saving energy and putting people back to work.

However, I think he's off the mark by having people drive hybrid cars since I still don't think hybrids are the right answer to the fuel problem. And seriously imposing a $2 tax on fuel will cripple the shipping industry since all they will do is pass the cost to the consumer. That's not the right way to go at all.

 

[JCE]

I won't read his drivel so excuse me if I assume here. So that overweight pyscho blowhard is calling for a $2 tax on petrol? I really hope he goes away permanently very quickly. I hated him before and now I hate him even more. The LAST thing you need to do is tax petrol. We can barely afford the stuff right now, adding $2 tax on it (especially when it goes back up to over $3.50/gal) will cause us poor people to never be able to travel. Booooooooooooooooooo!

We now resume your regularly scheduled topic.

 

[Keef]

Somewhere around here I read about a study that came to the conclusion that the world's 15 largest cargo ships output as much pollution is a year as the entire world's fleet of cars.

Basically what that means is that trying to curb pollution by regulating car emissions is an absolutely ludicrous idea.

Anything that could ever be done would be reversed in a matter of months, as China is constantly opening more and more coal-fired power plants, and those don't even have the converters we put on ours to recapture the carbon in the smoke.

 

[Northstar]

I just saw the GM "spin" commercial and it made me wonder. They said there was a time when 8 brands made sense, can someone tell me when this was?

 

[JCE]

Anything that could ever be done would be reversed in a matter of months, as China is constantly opening more and more coal-fired power plants, and those don't even have the converters we put on ours to recapture the carbon in the smoke.

Thank you for posting this. QFT No matter what WE do the world's pollution is about to get worse with more and more Chinese cars being sold. In a few years there maybe more cars in China than people in the USA.

 

[YSSMAN]

I just saw the GM "spin" commercial and it made me wonder. They said there was a time when 8 brands made sense, can someone tell me when this was?

"Back in the day," particularly in the post-war 20th Century, the way GM had been setup was actually extremely clever. Despite having all of these brands under a single umbrella, they all operated like independent automobile companies, striking out not only at their outside competition, but even at each other. They knew their markets, and they were extremely loyal. Every brand had their own engineering and marketing department, and they made some really interesting stuff.

...When things began to become "streamlined" in favor of "standardizing" Chevrolet bits across the board, that's likely when the ship came apart.

RE: Mike Moore

His article had some interesting points, but I can't say that I agree with all of it. He, and others, continue to believe somehow that we're magically going to turn all of the closed automobile plants into factories that will produce windmills and solar pannels... And while there are some plans to (possibly) do so, it still seems relatively unlikely that it will happen.

*Side Note: I've always wondered why GM or (insert car maker) never diversified to produce something other than cars and trucks, in a "just in case" scenario...

Simply put, we've got to diversify what we're doing up here. Its as easy as that. With some of the movie studios opening up for business in and around Detroit, I think that we may see some new opportunities coming into the state. But, making a couple handfuls of indie movies won't save the state.

 

[Philly]

I certainly agree that a lot of it is /facepalm material. That isn't really all too debatable. I do wonder what would happen if somebody did put the idea of using the old factories for useful projects in front of Congress.

I won't read his drivel so excuse me if I assume here. So that overweight pyscho blowhard is calling for a $2 tax on petrol? I really hope he goes away permanently very quickly. I hated him before and now I hate him even more. The LAST thing you need to do is tax petrol. We can barely afford the stuff right now, adding $2 tax on it (especially when it goes back up to over $3.50/gal) will cause us poor people to never be able to travel. Booooooooooooooooooo!

To be honest, I'm not really all that opposed to it. By itself, it would get people to drive less (reducing emissions) and get people to buy more fuel efficient cars (which the government is trying to force on us). I think it strikes a decent balance between the free market that works and we all like and the socialism that the government is putting forth that has good intentions but isn't convincing.

Shipping? Put different taxes on diesel and gasoline. Then people will also buy more diesel cars. And shipping uses mostly diesel so that wouldn't be affected as much.

But that aside, I brought the article in here to discuss the potentially smart points he made.

Basically what that means is that trying to curb pollution by regulating car emissions is an absolutely ludicrous idea.

According to Jalopnik, cars produce somewhere between 6 and 8 percent of carbon emissions. Which means that the auto industry is nothing more than an easy target. Shouldn't we be yelling at the government that they aren't actually trying to get anything done for climate change? Instead they're just picking on people? Srsly. Build nuclear power plants. it costs more, but you have to want to practice what you preach.

Anything that could ever be done would be reversed in a matter of months, as China is constantly opening more and more coal-fired power plants, and those don't even have the converters we put on ours to recapture the carbon in the smoke.

I think the idea is that we greatly reduce our carbon footprint, which does make a difference no matter what everybody else does. And if we, America to that, other countries may be willing to follow suit.

 

[Speedy Samurai]

I won't read his drivel so excuse me if I assume here. So that overweight pyscho blowhard is calling for a $2 tax on petrol? I really hope he goes away permanently very quickly. I hated him before and now I hate him even more. The LAST thing you need to do is tax petrol. We can barely afford the stuff right now, adding $2 tax on it (especially when it goes back up to over $3.50/gal) will cause us poor people to never be able to travel. Booooooooooooooooooo!

We now resume your regularly scheduled topic.

Gregg Easterbrook (of Tuesday Morning Quarterback fame) made this point last year as well. The idea is that people won't want to pay more for fuel and will actually desire and demand more fuel efficient cars, thus forcing the auto industry to produce more fuel efficient vehicles rather than the SUV's, etc. they have been producing for so long.

In short, making fuel more expensive might be the catalyst for more fuel efficient vehicles. Who would have thought?

 

[Joey D]

Looks like Penske has purchased Saturn...

GM to sell Saturn to Penske
Bankrupt automaker General Motors Corp. will sell its Saturn unit to car dealership operator Penske Automotive Group, a person familiar with the situation told CNNMoney.

Penske (PAG, Fortune 500) is owned by former race car driver Roger Penske, who owns NASCAR and IndyCar racing teams.

The sale is part of GM's strategy to shed its four "non-core" U.S. brands -- Saturn, Hummer, Pontiac and Saab -- as it restructures the company.

On Tuesday, GM (GMGMQ) announced a deal to sell its Hummer line to China's Sichuan Tengzhong Heavy Industrial Machinery Company Ltd.

There are about 400 Saturn dealers nationwide. The brand has been highly rated in customer satisfaction surveys for its no-haggle policy.

Sounds like the right move, at least Saturn will be staying in the US. I wonder though does this mean Saturn racing cars now .

 

[Omnis]

How's 2.0L I4, 140bhp and 2,588lb?

Your problem is solved. And at less than $16.000 for an SE and $17,500 for an SES model with some extra kit its good value too. Plus in that trim in the pic above is actually pretty neat. I like the darker colored grille, it detracts away from its hideousness.

Shame it looks so eye-gougingly awful, isn't it?