The Big Three? (Two? One? None?)
August 25, 2005 5:27 AM Subscribe
The first time as tragedy... Two of the three historic US' biggest auto makers (the other became a subsidiary of a German firm a few years back) just had their stocks rated as junk by Moody's, victims of a changing marketplace and demographics. Last time, Chrysler got a bailout from the US government, although maybe it would've been better if that hadn't happened. Would the Fed'rul Gummint step in again, or just let the dinosaurs' extinction proceed?
Maybe if the big 3 had developed something other than total crap in the last 30 years, things would be different.
posted by The Jesse Helms at 5:38 AM on August 25, 2005
posted by The Jesse Helms at 5:38 AM on August 25, 2005
Nice post alumshubby. IIRC, it was the Carter Administration and a Democratic Congress that stepped in in 1979 and bailed out Chrysler.
As the Cato Institute observed at the time:
The Chrysler subsidy would violate two political principles that have been highly important in this country: the principle that individuals are responsible for themselves and the principle that the government should treat people equally.
A real conservative would let the market spank GM and Ford. The conservative frauds in the GOP - the friends of big government and bigger friends of big business - will spend as much of the taxpayer's money as possible to stay in power.
posted by three blind mice at 5:44 AM on August 25, 2005
As the Cato Institute observed at the time:
The Chrysler subsidy would violate two political principles that have been highly important in this country: the principle that individuals are responsible for themselves and the principle that the government should treat people equally.
A real conservative would let the market spank GM and Ford. The conservative frauds in the GOP - the friends of big government and bigger friends of big business - will spend as much of the taxpayer's money as possible to stay in power.
posted by three blind mice at 5:44 AM on August 25, 2005
What The Jesse Helms said. (Thank Ghugle for the definite article.)
I drove Chrysler and GM cars for many years. Last year, I rented a Honda. This year, I bought one. The build and quality level of the car is so far beyond the crap that the US manufacuters produce that I have trouble trying to figure out how I didn't notice this before.
American industry can build good products. But the US car industry does not. Even after years of trying to make better cars, they're still so far behind Japan, and even Germany, that they can't compete.
In general, I want to see more skilled industry in the US. But when it comes to cars, the only way we'll have a decent US industry is to destroy Ford and GM and build anew.
As to a bailout, who knows? How much have they given BushCo?
posted by eriko at 5:46 AM on August 25, 2005
I drove Chrysler and GM cars for many years. Last year, I rented a Honda. This year, I bought one. The build and quality level of the car is so far beyond the crap that the US manufacuters produce that I have trouble trying to figure out how I didn't notice this before.
American industry can build good products. But the US car industry does not. Even after years of trying to make better cars, they're still so far behind Japan, and even Germany, that they can't compete.
In general, I want to see more skilled industry in the US. But when it comes to cars, the only way we'll have a decent US industry is to destroy Ford and GM and build anew.
As to a bailout, who knows? How much have they given BushCo?
posted by eriko at 5:46 AM on August 25, 2005
That's what I thought, clevershark, but the article does say the stocks were rated as junk. Given that GM has lost 50% of its market value in 5 years, I suppose it deserves it. Sad, really, but it has a lot to do with GM refusing to catch on to the reality of the market place.
posted by Goofyy at 5:50 AM on August 25, 2005
posted by Goofyy at 5:50 AM on August 25, 2005
This really isn't surprising. Standard and Poor's issued junk ratings back in May.
And as clevershark pointed out, this is a bond rating. I'm guessing that it won't have too much of an effect on stock price, since any impact would have already been felt after the May downgrading.
Ford's stock has actually been booming lately; you could have doubled your money in the past six months on it. Their sales are way up.
posted by mr_roboto at 5:51 AM on August 25, 2005
And as clevershark pointed out, this is a bond rating. I'm guessing that it won't have too much of an effect on stock price, since any impact would have already been felt after the May downgrading.
Ford's stock has actually been booming lately; you could have doubled your money in the past six months on it. Their sales are way up.
posted by mr_roboto at 5:51 AM on August 25, 2005
Given that we're starting to run out of oil, it does seem that car manufacturers are not a great long-term investment.
As long as the oil price keeps rising (and it will) the market for new cars is going to keep shrinking, and a good thing too.
That's just as true for Japan and Germany as it is for the US.
posted by cleardawn at 5:57 AM on August 25, 2005
As long as the oil price keeps rising (and it will) the market for new cars is going to keep shrinking, and a good thing too.
That's just as true for Japan and Germany as it is for the US.
posted by cleardawn at 5:57 AM on August 25, 2005
GM and Ford can make good cars, there's just 15 poorly contructed, designed, and efficient cars for every 1. I used to work for one with customer service and we pulled tooth and nail to help the customer out with their problems... too bad you can't make a bad product better with customer service. Give me a great product with so-so customer service than a poor product (cavalier) with great customer service.
When I buy my first new car, you bet your ass it will not be domestic.
posted by Dean Keaton at 5:58 AM on August 25, 2005
When I buy my first new car, you bet your ass it will not be domestic.
posted by Dean Keaton at 5:58 AM on August 25, 2005
Oh and not to mention gas mileage for the most part sucks in domestic, still.
posted by Dean Keaton at 5:59 AM on August 25, 2005
posted by Dean Keaton at 5:59 AM on August 25, 2005
That's what I thought, clevershark, but the article does say the stocks were rated as junk.
It's wrong. These are ratings on "senior unsecured debt". Bonds. Sloppy, sloppy writing from Bloomberg, apparently.
If you look at the Google News list of articles on this, only the Bloomberg feed has this error.
posted by mr_roboto at 5:59 AM on August 25, 2005
It's wrong. These are ratings on "senior unsecured debt". Bonds. Sloppy, sloppy writing from Bloomberg, apparently.
If you look at the Google News list of articles on this, only the Bloomberg feed has this error.
posted by mr_roboto at 5:59 AM on August 25, 2005
Far behind Germany?! LOL! More correctly, Mercedes is not far behind GM, in the down-the-toilet department...Although the perception of Mercedes as a class-act still holds in some circles. Myself, I've been a Toyota driver for decades, and I'm from Vehicle City, USA.
posted by Goofyy at 5:59 AM on August 25, 2005
posted by Goofyy at 5:59 AM on August 25, 2005
Here's a good plan that could help everyone. They could build cheap, energy efficient motorcycles that would lessen traffic congestion & make our cities better.
Or, they could come out with yet another SUV or 4 door sedan & die.
posted by password at 6:12 AM on August 25, 2005
Or, they could come out with yet another SUV or 4 door sedan & die.
posted by password at 6:12 AM on August 25, 2005
This isn't good news for those of us who live in Michigan...
Part of the problem that I think Ford et al. faces is that they build cars for about a three year cycle. After that, they assume that you want to get another car from them, and for a lot of people that model works great. Company cars, especially. It's just that if you own one yourself and you try to make it last more than three years, it's gonna fall apart. Whereas a nice riceburner like I've got...
And you'll notice that there's a difference in perception with GM versus actual problems. They came in a close second to Toyota on the JD Power survey, yet people still think that they're predominantly shitty (I wouldn't know, having never owned a GM car).
posted by klangklangston at 6:31 AM on August 25, 2005
Part of the problem that I think Ford et al. faces is that they build cars for about a three year cycle. After that, they assume that you want to get another car from them, and for a lot of people that model works great. Company cars, especially. It's just that if you own one yourself and you try to make it last more than three years, it's gonna fall apart. Whereas a nice riceburner like I've got...
And you'll notice that there's a difference in perception with GM versus actual problems. They came in a close second to Toyota on the JD Power survey, yet people still think that they're predominantly shitty (I wouldn't know, having never owned a GM car).
posted by klangklangston at 6:31 AM on August 25, 2005
bonds vs stocks rated as junk ==> self-bitchslap for brain cramp
I'm pretty vague on this -- I was in high school at the time and much more concerned with that cute cheerleader in my Earth Science class -- but I recall my father was disgusted with the idea of the government essentially giving a large corporation money to institute mediocrity, as he claimed the Chrysler "K-Car" attested. Too bad Daimler didn't buy 'em out then.
Companies as big as Chrysler/Ford/GM can achieve a lot through economies of scale, but they're spending large and growing shares of their income on pensions and health care for their employees -- considerably more than they spend on steel for the cars they make, I'm told. I don't think even the threat of bankruptcy is going to get the UAW to agree to sufficient concessions. What's more, unlike in the Carter era, I can't see this President and Congress agreeing to any kind of bailout package. After all, there's a war to pay for, and this time it would be two car companies, not one.
I'm not going to be in the market for a new car anytime soon anyway -- I'll be lucky if I can afford to replace my pickup truck with a used car, at the rate I'm going. In a few years, I may be re-entering the new-car market just in time for a Chevy or Ford going-out-of-business sale. Or maybe GM's products will be divisions of Nissan and Ford and Mercury will be Korean-owned trademarks? I dunno.
As somebody once quipped, "UAW" stands for "You Ain't Workin'."
posted by alumshubby at 6:33 AM on August 25, 2005
I'm pretty vague on this -- I was in high school at the time and much more concerned with that cute cheerleader in my Earth Science class -- but I recall my father was disgusted with the idea of the government essentially giving a large corporation money to institute mediocrity, as he claimed the Chrysler "K-Car" attested. Too bad Daimler didn't buy 'em out then.
Companies as big as Chrysler/Ford/GM can achieve a lot through economies of scale, but they're spending large and growing shares of their income on pensions and health care for their employees -- considerably more than they spend on steel for the cars they make, I'm told. I don't think even the threat of bankruptcy is going to get the UAW to agree to sufficient concessions. What's more, unlike in the Carter era, I can't see this President and Congress agreeing to any kind of bailout package. After all, there's a war to pay for, and this time it would be two car companies, not one.
I'm not going to be in the market for a new car anytime soon anyway -- I'll be lucky if I can afford to replace my pickup truck with a used car, at the rate I'm going. In a few years, I may be re-entering the new-car market just in time for a Chevy or Ford going-out-of-business sale. Or maybe GM's products will be divisions of Nissan and Ford and Mercury will be Korean-owned trademarks? I dunno.
As somebody once quipped, "UAW" stands for "You Ain't Workin'."
posted by alumshubby at 6:33 AM on August 25, 2005
I spent a good part of my life driving domestic, mostly Ford/Merc and GM. They were all crap. The last straw was a Mercury that simply fell apart at 80,000 miles because it was not built to last. I switched to a Nissan and have never looked back. Now I've got a VW that has given me nothing but joy, great mpg, and blazing acceleration. Never.buy.domestic.
posted by Ber at 6:39 AM on August 25, 2005
posted by Ber at 6:39 AM on August 25, 2005
They could build cheap, energy efficient motorcycles that would lessen traffic congestion & make our cities better.
What's it like to commute on a motorcycle in cold, snowy weather?
posted by alumshubby at 6:40 AM on August 25, 2005
What's it like to commute on a motorcycle in cold, snowy weather?
posted by alumshubby at 6:40 AM on August 25, 2005
The SUV was a temporary measure to stave off the inevitable. Most anyone will be able to find an INCREDIBLE deal on an SUV 1-3 years old at a car dealer near you within the next few months.
We're on our 2nd brand new Accord and may well be headed for a 3rd. They are that good.
Our current Accord has 150,000 miles on it (we're heavy commuters) and it is in better shape than my in-laws' Impala with 40,000 miles on it.
After a combined 250,000 miles on 2 Accords, we have had to replace tires and brakes, and perform typical oil changes, etc. That's it.
My car before that was a '91 Mazda 323, bought new. It was basically the cheapest brand new Japaneese car manufactured at the time. Total repair bill after a long college career and 100,000 miles? $500 (New radiator).
After spending 2x the value of the car in repairs over 3 years with a Plymouth and probably 4x the value of the car in repairs with a Buick, I don't plan on going back stateside.
I can't afford to.
posted by Ynoxas at 6:43 AM on August 25, 2005
We're on our 2nd brand new Accord and may well be headed for a 3rd. They are that good.
Our current Accord has 150,000 miles on it (we're heavy commuters) and it is in better shape than my in-laws' Impala with 40,000 miles on it.
After a combined 250,000 miles on 2 Accords, we have had to replace tires and brakes, and perform typical oil changes, etc. That's it.
My car before that was a '91 Mazda 323, bought new. It was basically the cheapest brand new Japaneese car manufactured at the time. Total repair bill after a long college career and 100,000 miles? $500 (New radiator).
After spending 2x the value of the car in repairs over 3 years with a Plymouth and probably 4x the value of the car in repairs with a Buick, I don't plan on going back stateside.
I can't afford to.
posted by Ynoxas at 6:43 AM on August 25, 2005
Companies as big as Chrysler/Ford/GM can achieve a lot through economies of scale, but they're spending large and growing shares of their income on pensions and health care for their employees -- considerably more than they spend on steel for the cars they make, I'm told.
And? The problem alumshubby is that save for the occassional Jeep Cherokee (owned by Chrysler) you see very few American-made cars on the roads outside of North America. Economy of scale doesn't mean anything if you don't scale your market. The Germans, Japanese, and Koreans have done it.... why not Detroit?
posted by three blind mice at 6:44 AM on August 25, 2005
And? The problem alumshubby is that save for the occassional Jeep Cherokee (owned by Chrysler) you see very few American-made cars on the roads outside of North America. Economy of scale doesn't mean anything if you don't scale your market. The Germans, Japanese, and Koreans have done it.... why not Detroit?
posted by three blind mice at 6:44 AM on August 25, 2005
The Big Three are perfect examples of what's wrong with corporate America. Over-payed and over-satisfied executives that fail to run a company that can produce products that will satisfy customers. Part of the problem is the branding mythology perpetuated by marketing fucks. Great products make great brands, not the other way around. BMW is a great brand because they make great sports sedans. The Cadillac brand used to be an icon and the best selling luxury brand in the U.S., now it's Lexus. Why? Because Cadillacs fall apart after a few years and have cheap plastic dashboards.
posted by disgruntled at 6:48 AM on August 25, 2005
posted by disgruntled at 6:48 AM on August 25, 2005
"The Germans, Japanese, and Koreans have done it.... why not Detroit?"
For the very same reasons you call out earlier - the free market system. Americans haven't pushed for a such a scale, quite the opposite recently. Of course, at some point, the bubble has to burst. I'm a bit amazed that I don't hear more people bitching about the prices but then again, I don't hear people bitching all that much about this administration period. I just find it weird, I remember when everyone had something to say about Clinton - good or bad.
cleardawn - I don't think this is so much an issue of 'running out of oil' as it is a lack of refinery production. America has been unable to build any refinery's of any significance for quite some time. Seems concerns over the environment or some species trumps our need for fuel. So, as I said, the bubble is going to have to burst at some point. I'm sure Bush is just hoping it takes a couple more years so he can blame it on the next guy.
posted by j.p. Hung at 6:55 AM on August 25, 2005
For the very same reasons you call out earlier - the free market system. Americans haven't pushed for a such a scale, quite the opposite recently. Of course, at some point, the bubble has to burst. I'm a bit amazed that I don't hear more people bitching about the prices but then again, I don't hear people bitching all that much about this administration period. I just find it weird, I remember when everyone had something to say about Clinton - good or bad.
cleardawn - I don't think this is so much an issue of 'running out of oil' as it is a lack of refinery production. America has been unable to build any refinery's of any significance for quite some time. Seems concerns over the environment or some species trumps our need for fuel. So, as I said, the bubble is going to have to burst at some point. I'm sure Bush is just hoping it takes a couple more years so he can blame it on the next guy.
posted by j.p. Hung at 6:55 AM on August 25, 2005
The Germans, Japanese, and Koreans have done it.... why not Detroit?
They have. However, rather than aggressively marketing their brands overseas, they have pursued a strategy of acquisition and partnership. Ford owns Volvo, Jaguar, Land Rover, Aston Martin, and 50% of Mazda. GM owns Saab and big pieces of Fiat, Mitsubishi, and Isuzu. (The relative quality of the Ford nameplates explains, to a large extent, Ford's superior stock performance. Fiat and Mitsubishi have been nothing but trouble for GM lately.)
It's actually a pretty good strategy, considering the reputation of the Ford and GM brands. I think that money was probably better spent in acquiring established brands rather than in trying desperately to build a reputation overseas.
posted by mr_roboto at 7:05 AM on August 25, 2005
They have. However, rather than aggressively marketing their brands overseas, they have pursued a strategy of acquisition and partnership. Ford owns Volvo, Jaguar, Land Rover, Aston Martin, and 50% of Mazda. GM owns Saab and big pieces of Fiat, Mitsubishi, and Isuzu. (The relative quality of the Ford nameplates explains, to a large extent, Ford's superior stock performance. Fiat and Mitsubishi have been nothing but trouble for GM lately.)
It's actually a pretty good strategy, considering the reputation of the Ford and GM brands. I think that money was probably better spent in acquiring established brands rather than in trying desperately to build a reputation overseas.
posted by mr_roboto at 7:05 AM on August 25, 2005
3bl, all I can think is that the North American market is already a pretty big sandbox to play in, and while they'd hate to admit it, American auto execs already know they have enough trouble trying to compete with foreign automakers on American turf; forget trying to get American products to penetrate established overseas markets, especially lately, now that "American" is getting to be a dirty word.
Don't get me wrong -- I'm not defending the big 3 for their evident lack of vision in failing to compete globally, or to stop acting stupidly in general. Even as a high-schooler, I knew the Joe Garagiola "Buy a car! Get a check!" ads for rebates on Fords were a bad sign. They've had it comin' for a while now.
If you wanted to fix Ford and GM, first, lock the doors for five years, then re-open them as cooperatives. Nobody is allowed to make more than 5x the wage of the lowest-paid janitor. Nobody gets any kind of bennies that everybody doesn't get.
posted by alumshubby at 7:05 AM on August 25, 2005
Don't get me wrong -- I'm not defending the big 3 for their evident lack of vision in failing to compete globally, or to stop acting stupidly in general. Even as a high-schooler, I knew the Joe Garagiola "Buy a car! Get a check!" ads for rebates on Fords were a bad sign. They've had it comin' for a while now.
If you wanted to fix Ford and GM, first, lock the doors for five years, then re-open them as cooperatives. Nobody is allowed to make more than 5x the wage of the lowest-paid janitor. Nobody gets any kind of bennies that everybody doesn't get.
posted by alumshubby at 7:05 AM on August 25, 2005
What models does the Ford sell in the States? In Europe, the Ka and the Focus won awards and have sold very well. Are they sold over there?
The last episode in the current series of BBC's Top Gear reviewed the top-selling car in the world - which turned out to be the unknown Ford F150 Lightning, only sold in North America. The conclusion? A piece of crap.
posted by salmacis at 7:09 AM on August 25, 2005
The last episode in the current series of BBC's Top Gear reviewed the top-selling car in the world - which turned out to be the unknown Ford F150 Lightning, only sold in North America. The conclusion? A piece of crap.
posted by salmacis at 7:09 AM on August 25, 2005
Let them die. It doesn't matter where cars come from as long as they're mechanically and ecologically sound. Americans in manufacturing jobs at GM and Ford will be able to apply for jobs at the Japanese (or new American) companies that take up the slack.
posted by pracowity at 7:09 AM on August 25, 2005
posted by pracowity at 7:09 AM on August 25, 2005
The gas pump prices certainly affect this. What really ran through my mind when SUV's began to pick up and get advertised aggressively after 9/11 was "Why would someone buy that? It is too expensive to maintain and daily drive." For some reason, GM and Ford just about sold themselves out on SUVs. The economy vehicles were not just economical on fuel, they were flimsy and stuck to old designs. The prices competed with japanese imports, and that was about as good as bringing a shotgun to a sniper fight.
I dealt with people for a long time saying "I bought this because I stand behind what it means to own one. Cmon mister, help me out. I can't pay these bills. A new headgasket at 61k miles? You gotta be kidding me!" Or women calling and pretty much sobbing because I had to say no to something that I didn't want to say no to.
But then there were situations were having an american customer service setup really made the difference.
A great situation was this middle aged woman, a widow, she took her veh to a dealership that she didn't buy the car from and they did some tire repairs on a recall. They way overtighten the spare and break that, and give her horrible tires. One blows on the road, and she limps it to a dlrshp... then she called me.
I called the dealership and we both immediately agreed this was not her fault, and right away we were both thinking of ways to make it right. Not only was she taken care of, we got her warranty extended to 100k and the regional manager personally apologised to her for the situation. And guess what? That other dealership, that regional manager chewed their asses out for doing it. Hopefully imports can do things like that.
posted by Dean Keaton at 7:15 AM on August 25, 2005
I dealt with people for a long time saying "I bought this because I stand behind what it means to own one. Cmon mister, help me out. I can't pay these bills. A new headgasket at 61k miles? You gotta be kidding me!" Or women calling and pretty much sobbing because I had to say no to something that I didn't want to say no to.
But then there were situations were having an american customer service setup really made the difference.
A great situation was this middle aged woman, a widow, she took her veh to a dealership that she didn't buy the car from and they did some tire repairs on a recall. They way overtighten the spare and break that, and give her horrible tires. One blows on the road, and she limps it to a dlrshp... then she called me.
I called the dealership and we both immediately agreed this was not her fault, and right away we were both thinking of ways to make it right. Not only was she taken care of, we got her warranty extended to 100k and the regional manager personally apologised to her for the situation. And guess what? That other dealership, that regional manager chewed their asses out for doing it. Hopefully imports can do things like that.
posted by Dean Keaton at 7:15 AM on August 25, 2005
J.p.Hung: True, the lack of refinery capacity appears to be the immediate cause of the current oil shortage.
But, if I may use a rather colorful metaphor, that's a little like saying that the reason you're bleeding to death so slowly is because the hole in your wrists isn't big enough.
Environmental regulations in the US (which are a joke, of course, particularly under Bush) are irrelevant to the level of refinery capacity, since there's nothing stopping the US companies from building capacity in third world countries instead - indeed, they usually do, for all the obvious reasons.
The oil companies have simply decided, on a rational, planned basis, over the last several years, not to invest the cash in extra refinery capacity. Why not? Because they know that we've already got plenty of capacity for the level of supply they predict we will have next year, and the year after, and the year after that.
In other words, the determinant of the appropriate level of refinery capacity has shifted from the level of demand, to the level of supply.
That is, of course, one definition, from the point of view of the oil companies, of the term "peak oil".
posted by cleardawn at 7:19 AM on August 25, 2005
But, if I may use a rather colorful metaphor, that's a little like saying that the reason you're bleeding to death so slowly is because the hole in your wrists isn't big enough.
Environmental regulations in the US (which are a joke, of course, particularly under Bush) are irrelevant to the level of refinery capacity, since there's nothing stopping the US companies from building capacity in third world countries instead - indeed, they usually do, for all the obvious reasons.
The oil companies have simply decided, on a rational, planned basis, over the last several years, not to invest the cash in extra refinery capacity. Why not? Because they know that we've already got plenty of capacity for the level of supply they predict we will have next year, and the year after, and the year after that.
In other words, the determinant of the appropriate level of refinery capacity has shifted from the level of demand, to the level of supply.
That is, of course, one definition, from the point of view of the oil companies, of the term "peak oil".
posted by cleardawn at 7:19 AM on August 25, 2005
GM also owns Subaru.
posted by disgruntled at 7:30 AM on August 25, 2005
posted by disgruntled at 7:30 AM on August 25, 2005
Good points Mr_Roboto and Alumshubby, but the acquisition of foreign brands doesn't quite help American workers in Detroit. Sure the Saab is full of GM parts, but the profits lie in the whole assembly. The Ka is made in Spain. The North American sandbox is big, but the world is bigger. I guess my point is that Mercedes sells the cars it makes in Stuttgart over the whole world - that's an economy of scale. There is worldwide appeal for their products. The big 3 just haven't been able to do that.
There doesn't seem to be much argument for the U.S. Congress to bailout a multinational that employs more people outside the U.S. than in it. That's not a bailout - it's a corporate giveaway.... so I guess I've convinced myself that it is sure to happen.
posted by three blind mice at 7:40 AM on August 25, 2005
There doesn't seem to be much argument for the U.S. Congress to bailout a multinational that employs more people outside the U.S. than in it. That's not a bailout - it's a corporate giveaway.... so I guess I've convinced myself that it is sure to happen.
posted by three blind mice at 7:40 AM on August 25, 2005
What models does the Ford sell in the States? In Europe, the Ka and the Focus won awards and have sold very well. Are they sold over there?
I wish we got the Ka. We have the Focus, but it's not the same Focus as is sold in Europe. It's an older, crappier version.
posted by Thorzdad at 7:44 AM on August 25, 2005
I wish we got the Ka. We have the Focus, but it's not the same Focus as is sold in Europe. It's an older, crappier version.
posted by Thorzdad at 7:44 AM on August 25, 2005
I've owned three used cars in my life, and one new one. Two of the used ones were Japanese and didn't last too long, while my 1991 Dodge Spirit was a gem--but this probably says more about how they were treated by their previous owners than it does about their makers. The new one is a Hyundai. Cheap as hell! But it starts every time I get in it...
Even though I have no allegiance to the big 3, I feel very bad for what's bound to happen to SE Michigan (where I live) as a result of this. Easy to say "let it die" when it's not in your backyard. Detroit is already a third world country. I think our governor has been trying to make Michigan more attractive to Japanese automakers. If you can't beat em, join em?
posted by apis mellifera at 7:48 AM on August 25, 2005
Even though I have no allegiance to the big 3, I feel very bad for what's bound to happen to SE Michigan (where I live) as a result of this. Easy to say "let it die" when it's not in your backyard. Detroit is already a third world country. I think our governor has been trying to make Michigan more attractive to Japanese automakers. If you can't beat em, join em?
posted by apis mellifera at 7:48 AM on August 25, 2005
And here I was not realizing...
Yeah, sure, some people will lose jobs and not find new ones easily, but keeping people on welfare while they train and look for work is cheaper and smarter than keeping entire companies on welfare because they're run by idiots.
Dead towns mean you have to create your own jobs or move to where the new jobs are (or hope other companies move in to replace the old companies, but what company would want to move to Detroit?).
posted by pracowity at 7:48 AM on August 25, 2005
Yeah, sure, some people will lose jobs and not find new ones easily, but keeping people on welfare while they train and look for work is cheaper and smarter than keeping entire companies on welfare because they're run by idiots.
Dead towns mean you have to create your own jobs or move to where the new jobs are (or hope other companies move in to replace the old companies, but what company would want to move to Detroit?).
posted by pracowity at 7:48 AM on August 25, 2005
GM also owns Subaru.
Not true.
GM has entered into limited agreements to work with Subaru, but does not *own* them.
GM DOES own Chevrolet, Pontiac, Buick, Cadillac, GMC, Oldsmobile, Saturn, HUMMER, Saab, Holden, Opel and Vauxhall.
posted by Jazznoisehere at 7:50 AM on August 25, 2005
Not true.
GM has entered into limited agreements to work with Subaru, but does not *own* them.
GM DOES own Chevrolet, Pontiac, Buick, Cadillac, GMC, Oldsmobile, Saturn, HUMMER, Saab, Holden, Opel and Vauxhall.
posted by Jazznoisehere at 7:50 AM on August 25, 2005
If you wanted to fix Ford and GM, first, lock the doors for five years, then re-open them as cooperatives. Nobody is allowed to make more than 5x the wage of the lowest-paid janitor. Nobody gets any kind of bennies that everybody doesn't get.
Do you really think you can get quality designers and engineers for those kinds of prices?
posted by delmoi at 7:54 AM on August 25, 2005
Do you really think you can get quality designers and engineers for those kinds of prices?
posted by delmoi at 7:54 AM on August 25, 2005
Hopefully, this will be another incentive for the auto companies to back a Dem who promises universal health care (which would take a HUGE burden off of American manufacturing).
posted by klangklangston at 8:00 AM on August 25, 2005
posted by klangklangston at 8:00 AM on August 25, 2005
From the Economist:
More than half of the profit margin of GM goes to pensions; but product quality cannot be improved without considerable investment; lower quality means lower sales which means higher discounts, which means lower profit margins. It's a vicious cycle. IMHO, Ford and GM's pension plans probably need to be bailed out as they are a social cost, not a duty of the company itself --in other words, what would happen if GM did shut down? will its ex-workers not have any pension coverage at all?
posted by costas at 8:02 AM on August 25, 2005
More than half of the profit margin of GM goes to pensions; but product quality cannot be improved without considerable investment; lower quality means lower sales which means higher discounts, which means lower profit margins. It's a vicious cycle. IMHO, Ford and GM's pension plans probably need to be bailed out as they are a social cost, not a duty of the company itself --in other words, what would happen if GM did shut down? will its ex-workers not have any pension coverage at all?
posted by costas at 8:02 AM on August 25, 2005
Do you really think you can get quality designers and engineers for those kinds of prices?
Only if you pay the janitors a living wage. And not pay the execs waaaay too much money to institute and reinforce mediocrity. I dunno. Does a car designer or an engineer who's paid five times as much elsewhere contribute 5x the value?
posted by alumshubby at 8:05 AM on August 25, 2005
Only if you pay the janitors a living wage. And not pay the execs waaaay too much money to institute and reinforce mediocrity. I dunno. Does a car designer or an engineer who's paid five times as much elsewhere contribute 5x the value?
posted by alumshubby at 8:05 AM on August 25, 2005
Nobody is allowed to make more than 5x the wage of the lowest-paid janitor.
Do you really think you can get quality designers and engineers for those kinds of prices?
If that's the only job in town, absolutely.
But it doesn't mean you have to pay the designers and engineers nothing. An automotive engineer gets 40 to 80 thousand dollars a year. A janitor gets 15 to 30 thousand dollars a year. 15 * 5 = the high end of the current salary range for automotive engineers. 30 * 5 = about double the normal salary of an automotive engineer now.
The guys who would have to take a cut under the suggested scheme would be upper management. And fuck them. They're the ones that let the companies fail.
posted by pracowity at 8:06 AM on August 25, 2005
Do you really think you can get quality designers and engineers for those kinds of prices?
If that's the only job in town, absolutely.
But it doesn't mean you have to pay the designers and engineers nothing. An automotive engineer gets 40 to 80 thousand dollars a year. A janitor gets 15 to 30 thousand dollars a year. 15 * 5 = the high end of the current salary range for automotive engineers. 30 * 5 = about double the normal salary of an automotive engineer now.
The guys who would have to take a cut under the suggested scheme would be upper management. And fuck them. They're the ones that let the companies fail.
posted by pracowity at 8:06 AM on August 25, 2005
Ah, to be a mouse in any pocket:
GM Board of Directors
Ford Board of Directors
posted by cenoxo at 8:34 AM on August 25, 2005
GM Board of Directors
Ford Board of Directors
posted by cenoxo at 8:34 AM on August 25, 2005
What's it like to commute on a motorcycle in cold, snowy weather?
posted by alumshubby at 8:40 AM CST on August 25 [!]
Actually, they do it in Europe with some frequency. The danger here would not be the weather as much as the other drivers who have no concept of how to drive in the snow to begin with, and would run you over due to their incompetency.
Actually, that's the biggest risk in dry warm weather as well.
A good dual-sport would do a passable job. Plus, if you live in an urban area, the major roadways are usually cleared almost immediately.
The cold can be combated with fairings, windshields, riding gear, and with electric garments that plug-in to the electrical system of the bike.
If you know someone who rides a BMW motorcycle, ask them about it. BMW riders take pride in riding their cycles in weather many people wouldn't take their cars out in.
Of course, the most prudent solution would be to have a motorcycle that would be perfectly ridable at least 8 months a year in Columbus, OH, and a small economy car for grocery store visits and when it truly is nasty outside.
By the way, fuel frugality doesn't have to mean poor performance. My motorcycle has 1300cc's (the same as some old Honda Civics), makes 145hp at the crank, and does 0-60 in 3.25 seconds, and the quarter in 11 seconds at 125mph. So it is basically a $12,000 Ferrari, with about the same luggage capacity. It also gets about 45mpg.
Why yes, I am a motorcycle evangelist. Why do you ask?
posted by Ynoxas at 8:38 AM on August 25, 2005
posted by alumshubby at 8:40 AM CST on August 25 [!]
Actually, they do it in Europe with some frequency. The danger here would not be the weather as much as the other drivers who have no concept of how to drive in the snow to begin with, and would run you over due to their incompetency.
Actually, that's the biggest risk in dry warm weather as well.
A good dual-sport would do a passable job. Plus, if you live in an urban area, the major roadways are usually cleared almost immediately.
The cold can be combated with fairings, windshields, riding gear, and with electric garments that plug-in to the electrical system of the bike.
If you know someone who rides a BMW motorcycle, ask them about it. BMW riders take pride in riding their cycles in weather many people wouldn't take their cars out in.
Of course, the most prudent solution would be to have a motorcycle that would be perfectly ridable at least 8 months a year in Columbus, OH, and a small economy car for grocery store visits and when it truly is nasty outside.
By the way, fuel frugality doesn't have to mean poor performance. My motorcycle has 1300cc's (the same as some old Honda Civics), makes 145hp at the crank, and does 0-60 in 3.25 seconds, and the quarter in 11 seconds at 125mph. So it is basically a $12,000 Ferrari, with about the same luggage capacity. It also gets about 45mpg.
Why yes, I am a motorcycle evangelist. Why do you ask?
posted by Ynoxas at 8:38 AM on August 25, 2005
The way the free market is supposed to work is that if the incumbent market leaders suck, they're driven out by talented upstarts who start grabbing their market share. The trouble is, the cost of entry into the U.S. automobile market is too high for any small company to get started -- ordinary consumers don't buy cars in numbers from small makers because there's no service network. So the foreign companies jump in instead, having built up a base in a relatively tiny domestic market to gather the production strength to leap into the U.S. market as a stroke.
We don't have the ability to incubate new car companies at home, so as the old ones get senescent, foreign makers take up the slack. I don't know what you do about this. You probably don't need to do anything. The good news is they eventually start employing people here in large numbers.
posted by George_Spiggott at 8:41 AM on August 25, 2005
We don't have the ability to incubate new car companies at home, so as the old ones get senescent, foreign makers take up the slack. I don't know what you do about this. You probably don't need to do anything. The good news is they eventually start employing people here in large numbers.
posted by George_Spiggott at 8:41 AM on August 25, 2005
The guys who would have to take a cut under the suggested scheme would be upper management. And fuck them. They're the ones that let the companies fail.
That was my point precisely. Well, about half of it...the co-op idea, but then, that's basically unworkable anyway given the kind of physical-plant investment that's called for.
posted by alumshubby at 8:45 AM on August 25, 2005
That was my point precisely. Well, about half of it...the co-op idea, but then, that's basically unworkable anyway given the kind of physical-plant investment that's called for.
posted by alumshubby at 8:45 AM on August 25, 2005
If anybody is unsure of the effects of letting these companies drown in their own red ink, just go watch Roger and Me. Multiply by a factor of ten.
posted by caddis at 8:48 AM on August 25, 2005
posted by caddis at 8:48 AM on August 25, 2005
(In the mid-70s we lived in Davison, MI, not far from Flint, the setting of Roger and Me -- I saw firsthand some of economic dislocation that was beginning to set in.)
caddis, I hear ya. But based on what costas pointed out above, what would you say are the potential costs of artificially prolonging a downward spiral?
posted by alumshubby at 9:06 AM on August 25, 2005
caddis, I hear ya. But based on what costas pointed out above, what would you say are the potential costs of artificially prolonging a downward spiral?
posted by alumshubby at 9:06 AM on August 25, 2005
I saw it too. It is all very well and good to tell people to go move somewhere else to find another job, but the reality is quite difficult, especially when the dislocations occur en masse. Many of the people from the '70s essentially never recovered. The importance of the auto industry to the overall economy is much less today than in the '70s, making a huge bailout less likely, but a little life support along the way may allow the industry to recover.
posted by caddis at 9:22 AM on August 25, 2005
posted by caddis at 9:22 AM on August 25, 2005
Has anyone read the articles recently about how people are really starting to bitch to their representatives about gasoline prices?
What strikes me as unbelievable in today's GOP is how willing they will probably be to cave in to the populism and get themselves all worked and intertwined with the oil/refinery industry - and, if things go ill for GM or Ford, to bail them out as well.
For all the rhetoric about how great the principles of the republican party are, they're going to go against them and get involved in the free market to "sort things out". Bastards.
posted by tgrundke at 9:37 AM on August 25, 2005
What strikes me as unbelievable in today's GOP is how willing they will probably be to cave in to the populism and get themselves all worked and intertwined with the oil/refinery industry - and, if things go ill for GM or Ford, to bail them out as well.
For all the rhetoric about how great the principles of the republican party are, they're going to go against them and get involved in the free market to "sort things out". Bastards.
posted by tgrundke at 9:37 AM on August 25, 2005
People keep calling the Chrysler loan guarantee of 1979 a "bail-out", it wasn't. The only cost to the government was that incurred drawing up the paper work. Chrysler not only did not receive any money from the Federal Government, they even repaid the guaranteed loans ahead of schedule. The government's actions in '79 kept thousands of people working. A much better solution than having all those people on Employment Insurance.
GM's problems are much deeper than the short term cash flow problem Chrysler had which was precipated by their buy out of AMC, a great big win long term.
And on personal experiences import vs. domestic: All cars are holes you shovel money into. Any car made in the last ten years is going to vastly superior to those made 15-20 years ago. I've pretty well alternated between Toyota and Dodge with the occasional Pontiac, Ford and Buick thrown in. My 82 Corolla was no more nor less reliable than the 80 Dodge it replaced (both had similar mileage) however the alternator for the /6 was $70 and the same part for the Toyota was almost $300. And when I changed a window in the Dodge it didn't need to be shipped by slow boat from Japan.
posted by Mitheral at 10:27 AM on August 25, 2005
GM's problems are much deeper than the short term cash flow problem Chrysler had which was precipated by their buy out of AMC, a great big win long term.
And on personal experiences import vs. domestic: All cars are holes you shovel money into. Any car made in the last ten years is going to vastly superior to those made 15-20 years ago. I've pretty well alternated between Toyota and Dodge with the occasional Pontiac, Ford and Buick thrown in. My 82 Corolla was no more nor less reliable than the 80 Dodge it replaced (both had similar mileage) however the alternator for the /6 was $70 and the same part for the Toyota was almost $300. And when I changed a window in the Dodge it didn't need to be shipped by slow boat from Japan.
posted by Mitheral at 10:27 AM on August 25, 2005
If anybody is unsure of the effects of letting these companies drown in their own red ink...
If the alternative is corporate welfare that puts billions of dollars into failing businesses, it would be better to let them fail (and maybe be taken over by smarter businesspeople).
And if you have to pay for the failure of the companies (other than through normal unemployment), give the welfare directly to the employees. Then sell the remains of Ford and GM to the highest bidders, maybe some Chinese or Indian companies looking for a way into the US market. I bet they'd make it work.
But don't prop up a company run by people who don't know how to run a company.
posted by pracowity at 10:40 AM on August 25, 2005
If the alternative is corporate welfare that puts billions of dollars into failing businesses, it would be better to let them fail (and maybe be taken over by smarter businesspeople).
And if you have to pay for the failure of the companies (other than through normal unemployment), give the welfare directly to the employees. Then sell the remains of Ford and GM to the highest bidders, maybe some Chinese or Indian companies looking for a way into the US market. I bet they'd make it work.
But don't prop up a company run by people who don't know how to run a company.
posted by pracowity at 10:40 AM on August 25, 2005
As a lifelong resident of SE Michigan, we have seen this first hand. As shown by, as mentioned above, "Roger and Me," it ain't pretty...
The people who say just let the American automakers die are forgetting that it's more than just their employeees who would be affected. The Big 3 are a huge economic force in this country. There's a domino effect. You have their tier 1 suppliers that would struggle or go under. They would have suppliers. Let alone businesses and service industries that are supported by all those manufacturers and their employees. Trucking, shipping, food service, retail, so on. Let alone the taxes they pay to the communities. It's a slippery slope.
Sure, maybe 5 -10 years down the line, maybe new industries and technology would pick up the slack. But tell that the 45 year old worker who has a mortgage and a wife and kids who needs work now.
I have no solution to what ails the auto industry. They do need to improve their product. But as said above, they also make some damn good cars as well. To just write them off is being short sighted.
posted by bawanaal at 10:45 AM on August 25, 2005
The people who say just let the American automakers die are forgetting that it's more than just their employeees who would be affected. The Big 3 are a huge economic force in this country. There's a domino effect. You have their tier 1 suppliers that would struggle or go under. They would have suppliers. Let alone businesses and service industries that are supported by all those manufacturers and their employees. Trucking, shipping, food service, retail, so on. Let alone the taxes they pay to the communities. It's a slippery slope.
Sure, maybe 5 -10 years down the line, maybe new industries and technology would pick up the slack. But tell that the 45 year old worker who has a mortgage and a wife and kids who needs work now.
I have no solution to what ails the auto industry. They do need to improve their product. But as said above, they also make some damn good cars as well. To just write them off is being short sighted.
posted by bawanaal at 10:45 AM on August 25, 2005
Toyota Prius - increases in value by $3000 when driven off the new car lot - in great demand
giant SUVs - can't give them away now but generated tremendous profits for a few years. short sighted executive decision makers deserve exorbitant salaries? hardly.
posted by nofundy at 11:52 AM on August 25, 2005
giant SUVs - can't give them away now but generated tremendous profits for a few years. short sighted executive decision makers deserve exorbitant salaries? hardly.
posted by nofundy at 11:52 AM on August 25, 2005
And see, Nofundy, that's the problem. The US Automakers decided to put their heads in the sand while their japanese rivals developed hybrid technology. Instead of investing, they pumped their money into making larger and larger SUV's that provided tremendous short term ROI, as they were cheap to build and garnered 50K+. Plus, they put rediculous rebates on cars, creating a culture where America just expects domestic cars to be sold 3-5K below invoice.
Now, the only US automaker with a hybrid out there is Ford, with the Escape and the upcoming Mariner. Oh, and the only reason they have it is because they licensed the technology. From Toyota.
And now they want the country to bail them out.
[Napolean Dynamite]
IDIOTS
[/Napolean Dynamite]
posted by prodigalsun at 12:27 PM on August 25, 2005
Now, the only US automaker with a hybrid out there is Ford, with the Escape and the upcoming Mariner. Oh, and the only reason they have it is because they licensed the technology. From Toyota.
And now they want the country to bail them out.
[Napolean Dynamite]
IDIOTS
[/Napolean Dynamite]
posted by prodigalsun at 12:27 PM on August 25, 2005
What's it like to commute on a motorcycle in cold, snowy weather?
posted by alumshubby at 8:40 AM CST on August 25
Apart from Ynoxas's suggestions, there's also the solution of moving somewhere warm and sunny. One of the main reasons I moved to Los Angeles from New Jersey is that I can ride my motorcycle pretty much every day. My bike's pretty good in the rain so I just have to wear a rainsuit over my leather - and be VERY VERY careful to watch out for all the bald-tired cars with their skill-free drivers.
Ynoxas, I'm totally with you on the performance angle; my bike is a 2002 Honda 919 (a Hornet 900, for non-USians) which cost me $8,000 even, gets 45 MPG, and will do 0-60 in 2.9 seconds, with 112 HP and 106 ft.-lb. torque (it's a lot lighter than your 1300). That's better acceleration than anything but the Dodge Viper and the Ford GT40.
And, in a special bonus here in California, it's legal to "lane-split" (filtering, non-USians) or run between lanes of stopped or slow traffic on the freeway, which cuts my 10-mile commute from an hour (yes, you read right) to about 20 minutes, thus not only saving gas but giving me back 8 hours of my life per week.
Motorcycle evangelists, unite!
My car is a 1983 Honda Accord hatchback with 159,000 miles that I bought for $500. I put about that much into it every year for repairs and scheduled maintenance. It gets about 28 MPG on average, but I don't drive it much. I expect it to last me another 100,000 miles easily, although I'd like to upgrade to something newer and more stylish sometime. (A used BMW or Benz would probably work nicely.) The most expensive item of that car? Insurance!! Just shy of $1100 per year - and that's only liability. Sheesh.
Anyway, I guess I'm kind of doing what Ynoxas advocates. Sure saves me a crapload of cash... :)
Cars seem to be much more a fashion item and/or status symbol for Americans, or at least more prevalently so than for others around the world, which drives a very unhealthy cycle of buying new cars every 3 years, instead of considering a car as a "durable item," which it should be. That's certainly part of what's driven the new car market and profit therefrom.
posted by zoogleplex at 12:35 PM on August 25, 2005
posted by alumshubby at 8:40 AM CST on August 25
Apart from Ynoxas's suggestions, there's also the solution of moving somewhere warm and sunny. One of the main reasons I moved to Los Angeles from New Jersey is that I can ride my motorcycle pretty much every day. My bike's pretty good in the rain so I just have to wear a rainsuit over my leather - and be VERY VERY careful to watch out for all the bald-tired cars with their skill-free drivers.
Ynoxas, I'm totally with you on the performance angle; my bike is a 2002 Honda 919 (a Hornet 900, for non-USians) which cost me $8,000 even, gets 45 MPG, and will do 0-60 in 2.9 seconds, with 112 HP and 106 ft.-lb. torque (it's a lot lighter than your 1300). That's better acceleration than anything but the Dodge Viper and the Ford GT40.
And, in a special bonus here in California, it's legal to "lane-split" (filtering, non-USians) or run between lanes of stopped or slow traffic on the freeway, which cuts my 10-mile commute from an hour (yes, you read right) to about 20 minutes, thus not only saving gas but giving me back 8 hours of my life per week.
Motorcycle evangelists, unite!
My car is a 1983 Honda Accord hatchback with 159,000 miles that I bought for $500. I put about that much into it every year for repairs and scheduled maintenance. It gets about 28 MPG on average, but I don't drive it much. I expect it to last me another 100,000 miles easily, although I'd like to upgrade to something newer and more stylish sometime. (A used BMW or Benz would probably work nicely.) The most expensive item of that car? Insurance!! Just shy of $1100 per year - and that's only liability. Sheesh.
Anyway, I guess I'm kind of doing what Ynoxas advocates. Sure saves me a crapload of cash... :)
Cars seem to be much more a fashion item and/or status symbol for Americans, or at least more prevalently so than for others around the world, which drives a very unhealthy cycle of buying new cars every 3 years, instead of considering a car as a "durable item," which it should be. That's certainly part of what's driven the new car market and profit therefrom.
posted by zoogleplex at 12:35 PM on August 25, 2005
In Ford's defense: I don't know much about the business side, but I really believe that a Ford really is the most sturdy car you can buy today. A Toyota is still more economical-- it's reliable, and it will last-- but the Ford will last longer, and parts will break less easily. Ford, and the rest of the American companies, seem to have taken a big hit around the late '70's. (I've heard that has something to do with the mileage restrictions of Jimmy Carter that were later nullified by Reagan.) American cars from the eighties... don't exist anymore. They all died pretty quick. And GM still makes crap, and even manages to destroy everything it touches; remember back when Saabs were reliable and popular? See what they did with Hummer? I don't trust them a bit. But Ford has made something of a comeback, I think. While their cars of even seven years ago were still sort of trashy, the stuff they produce now is more solid than they've made it in decades. They're making the right moves economically, and I think they could be okay if they were careful.
Toyota, though, there's a car company. Seriously, I can't think of anybody who makes anything that's been that successful. I'll keep driving Toyotas so long as I can get my hands on them.
posted by koeselitz at 12:51 PM on August 25, 2005
Toyota, though, there's a car company. Seriously, I can't think of anybody who makes anything that's been that successful. I'll keep driving Toyotas so long as I can get my hands on them.
posted by koeselitz at 12:51 PM on August 25, 2005
They would have suppliers. Let alone businesses and service industries that are supported by all those manufacturers and their employees. Trucking, shipping, food service, retail, so on. Let alone the taxes they pay to the communities. It's a slippery slope.
This is truth. I've had twelve jobs/contracts since moving to SE Michigan, and only four of them were not either for or supplied services to the Big 3. There are thousands of people in SE Michigan who would be out of work, not because their employer went out of business, but because the companies they received business from went out of business. And not just in food service and trucking, but in IT, Accounting, Call Centers, etc. If the Big 3 just up and vanished one day, you might as well have dropped a nuclear warhead on Detroit. It would have about the same impact.
posted by shawnj at 12:58 PM on August 25, 2005
This is truth. I've had twelve jobs/contracts since moving to SE Michigan, and only four of them were not either for or supplied services to the Big 3. There are thousands of people in SE Michigan who would be out of work, not because their employer went out of business, but because the companies they received business from went out of business. And not just in food service and trucking, but in IT, Accounting, Call Centers, etc. If the Big 3 just up and vanished one day, you might as well have dropped a nuclear warhead on Detroit. It would have about the same impact.
posted by shawnj at 12:58 PM on August 25, 2005
What I'm wondering is, what kind of impact will the financial trouble have on Ford and GM? It'll make it more expensive for them to borrow money for stuff like retooling to produce new models even as their other big expenses -- employee pensions and health care are rising too. Won't that translate into an even harder time responding to changes in the public's buying habits (e.g., SUVs out, hybrids in)?
Here's a guess: Mergers and spinoffs -- combine and consolidate their offerings and accept that they'll wind up a unified, smaller auto manufacturer?
posted by alumshubby at 1:37 PM on August 25, 2005
Here's a guess: Mergers and spinoffs -- combine and consolidate their offerings and accept that they'll wind up a unified, smaller auto manufacturer?
posted by alumshubby at 1:37 PM on August 25, 2005
Sure, maybe 5 -10 years down the line, maybe new industries and technology would pick up the slack. But tell that the 45 year old worker who has a mortgage and a wife and kids who needs work now.
This is where the cold, hard edge of capitalism comes to rest: on the back of the loyal worker. No industry is immune. I don't know what to say except that millions of people are in the same boat - you're a great worker, good at your job, but nobody wants you. When you can't put food on the table anymore, go try and compete for the minimum-wage service-industry jobs that everyone else is reaching for as a lifeline. You know, you can always be an aide in a nursing home, changing old people's diapers. Nursing homes are a growth industry, don't you know, with the baby boomers about to hit retirement. Sell your house. Home ownership is for the middle class, and you will no longer qualify.
People in this country *like* the fact that economic success is far from guaranteed here. Try to build more of a social safety net for the unlucky, and people will scream about how high their taxes are getting. America is an "I got mine, so I don't give a shit about *you*" kind of country.
Kids growing up these days know they can't count on being employed in their preferred field for long stretches of time. To make yourself resilient in the face of job cuts, it's good to have multiple skillsets. Or work at being an entrepreneur. Or pray to that deity who has always brought you good things in your life. That should work.
posted by beth at 3:21 PM on August 25, 2005
This is where the cold, hard edge of capitalism comes to rest: on the back of the loyal worker. No industry is immune. I don't know what to say except that millions of people are in the same boat - you're a great worker, good at your job, but nobody wants you. When you can't put food on the table anymore, go try and compete for the minimum-wage service-industry jobs that everyone else is reaching for as a lifeline. You know, you can always be an aide in a nursing home, changing old people's diapers. Nursing homes are a growth industry, don't you know, with the baby boomers about to hit retirement. Sell your house. Home ownership is for the middle class, and you will no longer qualify.
People in this country *like* the fact that economic success is far from guaranteed here. Try to build more of a social safety net for the unlucky, and people will scream about how high their taxes are getting. America is an "I got mine, so I don't give a shit about *you*" kind of country.
Kids growing up these days know they can't count on being employed in their preferred field for long stretches of time. To make yourself resilient in the face of job cuts, it's good to have multiple skillsets. Or work at being an entrepreneur. Or pray to that deity who has always brought you good things in your life. That should work.
posted by beth at 3:21 PM on August 25, 2005
What's it like to commute on a motorcycle in cold, snowy weather?
posted by alumshubby at 8:40 AM CST on August 25
It's not that bad.
The worst part is that they don't make snow tires for bikes.
That and black ice(but that's a problem cars face as well).
Also, if it's very cold, condensation on your visor is a real concern(no defroster in a helmet. heh)
posted by madajb at 3:23 PM on August 25, 2005
posted by alumshubby at 8:40 AM CST on August 25
It's not that bad.
The worst part is that they don't make snow tires for bikes.
That and black ice(but that's a problem cars face as well).
Also, if it's very cold, condensation on your visor is a real concern(no defroster in a helmet. heh)
posted by madajb at 3:23 PM on August 25, 2005
There is so much arrogance and ignorance on display in this thread that I don't know where to begin.
The tremendous superiority of import vehicles is a myth. While imports do lead the list, the quality gap has narrowed to the point where it's pretty much a non-issue. (I wouldn't brag about the quality of a VW if I were you. There are good reasons their sales have been plunging.)
How many of you import snobs ranting about crappy American products are talking about stuff that was produced 10, 15 or even 20 years ago -- and you're still stuck in that mindset? You might as well rant that "Windows sucks -- I know because I tried version 3.1."
Neither Ford nor GM has asked for a bailout. It's not that bad. Not yet, anyway. Don't get all bent out of shape over something that hasn't even happened.
Chrysler was not the first company the federal government assisted. Lockheed was a notable predecessor.
The Chrysler loan guarantees were NOT after their purchase of AMC, but before it.
The US government made a PROFIT from the Chrysler loan guarantees. The loans were paid back years ahead of schedule, and part of terms were that the Feds got stock ... which they later sold for a profit.
For better or worse, the Big Three have been producing vehicles with the size and power that most people want. Americans haven't wanted -- and still do not want -- fuel-efficient vehicles. Even now. I saw a clip on ABC the other night that went something like this:
Reporter: What do you think of these gas prices?
Woman at shopping mall: Oh, they're terrible!
Reporter: So are you ready to give up your Lexus SUV?
Woman: No.
Should we as a society make fuel efficiency a higher priority? Absolutely. But jacking up CAFE standards is the wrong way to do it -- it forces automakers to build cars people don't want. If you really want to see fuel economy improve, you have to make buyers want it ... and the only way to do that is to raise the price of gasoline even higher, with taxes. Even the Big Three have repeatedly argued that. But no politician who wants to get re-elected will ever do that.
Import cars get better fuel economy? Well, duh -- there's a good reason for that. Look at the price of fuel in their home markets. Fuel here in the US has been cheaper than water, so why would US automakers worry about it?
As for American companies not producing hybrids ... well, newsflash, companies sometimes underestimate potential markets. You may claim it was an obvious market, but:
1) you're not everyone -- just because YOU wanted one doesn't mean that it could be predicted that MANY people would want one,
2) it was hard to predict that a car that doesn't make economic sense would sell well (you'll be lucky to recoup the $3000-5000 premium for a hybrids with gas savings -- especially many of the latest ones that use the electric motor to improve performance, not fuel economy) and most importantly,
3) you have the slight advantage of hindsight.
And spare us the motorcycle proseltyzing. If it works for you, fine. Americans won't even consider a small car, let alone a motorcycle.
One statement that actually is correct is the estimate that more of the car's cost comes from health care that from the steel required to build it. Foreign automakers don't have the spiraling health care costs that American automakers do. They have national health care. The American companies understand this quite well, but are reluctant to bring it up because they fear they'll be dismissed as whiners.
Overpaid executives -- well, I'll agree with that one. But that's not unique to the car business here in America.
My personal philosophy is that I won't try to twist anyone's arm to buy an American car ... but I will twist it to get you to at least consider an American car.
posted by pmurray63 at 6:50 PM on August 25, 2005
The tremendous superiority of import vehicles is a myth. While imports do lead the list, the quality gap has narrowed to the point where it's pretty much a non-issue. (I wouldn't brag about the quality of a VW if I were you. There are good reasons their sales have been plunging.)
How many of you import snobs ranting about crappy American products are talking about stuff that was produced 10, 15 or even 20 years ago -- and you're still stuck in that mindset? You might as well rant that "Windows sucks -- I know because I tried version 3.1."
Neither Ford nor GM has asked for a bailout. It's not that bad. Not yet, anyway. Don't get all bent out of shape over something that hasn't even happened.
Chrysler was not the first company the federal government assisted. Lockheed was a notable predecessor.
The Chrysler loan guarantees were NOT after their purchase of AMC, but before it.
The US government made a PROFIT from the Chrysler loan guarantees. The loans were paid back years ahead of schedule, and part of terms were that the Feds got stock ... which they later sold for a profit.
For better or worse, the Big Three have been producing vehicles with the size and power that most people want. Americans haven't wanted -- and still do not want -- fuel-efficient vehicles. Even now. I saw a clip on ABC the other night that went something like this:
Reporter: What do you think of these gas prices?
Woman at shopping mall: Oh, they're terrible!
Reporter: So are you ready to give up your Lexus SUV?
Woman: No.
Should we as a society make fuel efficiency a higher priority? Absolutely. But jacking up CAFE standards is the wrong way to do it -- it forces automakers to build cars people don't want. If you really want to see fuel economy improve, you have to make buyers want it ... and the only way to do that is to raise the price of gasoline even higher, with taxes. Even the Big Three have repeatedly argued that. But no politician who wants to get re-elected will ever do that.
Import cars get better fuel economy? Well, duh -- there's a good reason for that. Look at the price of fuel in their home markets. Fuel here in the US has been cheaper than water, so why would US automakers worry about it?
As for American companies not producing hybrids ... well, newsflash, companies sometimes underestimate potential markets. You may claim it was an obvious market, but:
1) you're not everyone -- just because YOU wanted one doesn't mean that it could be predicted that MANY people would want one,
2) it was hard to predict that a car that doesn't make economic sense would sell well (you'll be lucky to recoup the $3000-5000 premium for a hybrids with gas savings -- especially many of the latest ones that use the electric motor to improve performance, not fuel economy) and most importantly,
3) you have the slight advantage of hindsight.
And spare us the motorcycle proseltyzing. If it works for you, fine. Americans won't even consider a small car, let alone a motorcycle.
One statement that actually is correct is the estimate that more of the car's cost comes from health care that from the steel required to build it. Foreign automakers don't have the spiraling health care costs that American automakers do. They have national health care. The American companies understand this quite well, but are reluctant to bring it up because they fear they'll be dismissed as whiners.
Overpaid executives -- well, I'll agree with that one. But that's not unique to the car business here in America.
My personal philosophy is that I won't try to twist anyone's arm to buy an American car ... but I will twist it to get you to at least consider an American car.
posted by pmurray63 at 6:50 PM on August 25, 2005
pmurray63 writes "How many of you import snobs ranting about crappy American products are talking about stuff that was produced 10, 15 or even 20 years ago"
The car I get to drive these days is a 3 year old Chrysler 300M.
It's on its third set of brakes at 60,000 km. To specify, it had to have its disks *and* shoes replaced twice. The mags are now stained by the metal dust coming from the brakes. I've had the issue looked at by many a Chrysler mechanic, and they're all absolutely adamant that there's nothing wrong with the car, so much so that at the last disk replacement they decided to refuse to honor the warranty which is stated explicitly on the bill from the previous replacement. Chrysler Canada, without asking any questions whatsoever, cited with the dishonest mechanics and refused the coverage.
The reason why I won't be buying any American cars is that the quality is shoddy, the goods are, in my experience, as likely to be defective as not, the after-sale service is shoddy and dishonest and in my experience the company itself is just as crooked as its mechanics. And that's not something related to a car produced "10, 15 or even 20 years ago", that's a 3-year-old car we're talking about.
posted by clevershark at 8:04 PM on August 25, 2005
The car I get to drive these days is a 3 year old Chrysler 300M.
It's on its third set of brakes at 60,000 km. To specify, it had to have its disks *and* shoes replaced twice. The mags are now stained by the metal dust coming from the brakes. I've had the issue looked at by many a Chrysler mechanic, and they're all absolutely adamant that there's nothing wrong with the car, so much so that at the last disk replacement they decided to refuse to honor the warranty which is stated explicitly on the bill from the previous replacement. Chrysler Canada, without asking any questions whatsoever, cited with the dishonest mechanics and refused the coverage.
The reason why I won't be buying any American cars is that the quality is shoddy, the goods are, in my experience, as likely to be defective as not, the after-sale service is shoddy and dishonest and in my experience the company itself is just as crooked as its mechanics. And that's not something related to a car produced "10, 15 or even 20 years ago", that's a 3-year-old car we're talking about.
posted by clevershark at 8:04 PM on August 25, 2005
bashing capitalism - you can support the redistribution of wealth (socialism) if you like: agree to disagree, but you can't be so retarded as to knock capitalism. Even those radiant bastions of European socialism have unplanned economies.
I imagine you'd be hard pressed to find a counter example, but Ill glady listen to any you folks could offer.
on topic - Let bad companies rot. People are supposed to have a right to their property (money), they don't have a right to a job. Sorry you folks don't understand that.
Ill admit, Id prolly think differently if i was face to face with the desperation you are talking about, but then id hold my own mother under water if i was drowning. Say what you like, you would too. Still isn't right.....
posted by Tryptophan-5ht at 8:39 PM on August 25, 2005
I imagine you'd be hard pressed to find a counter example, but Ill glady listen to any you folks could offer.
on topic - Let bad companies rot. People are supposed to have a right to their property (money), they don't have a right to a job. Sorry you folks don't understand that.
Ill admit, Id prolly think differently if i was face to face with the desperation you are talking about, but then id hold my own mother under water if i was drowning. Say what you like, you would too. Still isn't right.....
posted by Tryptophan-5ht at 8:39 PM on August 25, 2005
there's also the solution of moving somewhere warm and sunny. One of the main reasons I moved to Los Angeles from New Jersey is that I can ride my motorcycle pretty much every day.
I feel you zoogleplex. I have a friend in Tucson that is lobbying me quite strongly to relocate, and using that very situation as ammunition.
Another friend of mine has a longish commute, about 50 miles each day through mostly rural areas. By riding his motorcycle, at current gas prices, he's saving $5 a day by simply sitting on two wheels instead of 4.
posted by Ynoxas at 8:56 PM on August 25, 2005
I feel you zoogleplex. I have a friend in Tucson that is lobbying me quite strongly to relocate, and using that very situation as ammunition.
Another friend of mine has a longish commute, about 50 miles each day through mostly rural areas. By riding his motorcycle, at current gas prices, he's saving $5 a day by simply sitting on two wheels instead of 4.
posted by Ynoxas at 8:56 PM on August 25, 2005
clevershark, I sympathize with your problem. But it sounds like part of it may be that you're working with a bad dealership.
(Many people don't seem to realize that the dealer is an independent business from the automaker. They'll write off an entire automaker because they believe one dealer screwed them.)
If the dealership wasn't willing to go to bat for you with Chrysler, that likely lowered your chances of getting help. And if the dealership is not honoring their own service warranty, perhaps you should take them to small-claims court.
My last boss always stressed that you should choose your dealer carefully, because you're buying a relationship with them. That's a bit harder for people who aren't in the business, unfortunately. But buying from a dealer a long way away just to save a few dollars is not a good idea (not that you did that, I'm generalizing here).
I too have discovered that aluminum wheels can be a pain in the neck when it comes to brake dust. That's especially true if you bought the performance package on that particular car, because those pads produce even more dust. That's simply the nature of the beast.
posted by pmurray63 at 4:58 AM on August 26, 2005
(Many people don't seem to realize that the dealer is an independent business from the automaker. They'll write off an entire automaker because they believe one dealer screwed them.)
If the dealership wasn't willing to go to bat for you with Chrysler, that likely lowered your chances of getting help. And if the dealership is not honoring their own service warranty, perhaps you should take them to small-claims court.
My last boss always stressed that you should choose your dealer carefully, because you're buying a relationship with them. That's a bit harder for people who aren't in the business, unfortunately. But buying from a dealer a long way away just to save a few dollars is not a good idea (not that you did that, I'm generalizing here).
I too have discovered that aluminum wheels can be a pain in the neck when it comes to brake dust. That's especially true if you bought the performance package on that particular car, because those pads produce even more dust. That's simply the nature of the beast.
posted by pmurray63 at 4:58 AM on August 26, 2005
Ill admit, Id prolly think differently if i was face to face with the desperation you are talking about, but then id hold my own mother under water if i was drowning.
Ah, I like how your attempt to write "I'd" came out as id.
Another SE Michiganian here, echoing what others have said about how the shock waves spread out and affect many of us who don't work in the auto industry.
I'm in the nonprofit field, and MI nonprofits (social service, the arts and education) have been experiencing lean times for 15 years - due, at first, to government funding cutbacks. We already had a mild case of pneumonia before GM even started sneezing. And as the economy tanks, the corporate and individual funding is affected too.
I've experienced firsthand how sucky Michigan's economy has been the past few years in particular (through un- and uneremployment) -- although I still see plenty of people perhaps fiddling while Rome burns, buying their gas-guzzlers and their McMansions.
That said ... Yep, I drive a Japanese car. And love it. In fact, a lot of people in nonprofits drive Japanese. At my income level I need a *long-lasting*, economical, reliable car. [Oh, and I hate motorcycles - they're noisy bastards.]
Do any of you SE MI folks know about Oakland County's Automation Alley iniative? Is it geared toward encouraging non-auto related enterprises (which would be the smart thing)?
posted by NorthernLite at 6:34 AM on August 26, 2005
Ah, I like how your attempt to write "I'd" came out as id.
Another SE Michiganian here, echoing what others have said about how the shock waves spread out and affect many of us who don't work in the auto industry.
I'm in the nonprofit field, and MI nonprofits (social service, the arts and education) have been experiencing lean times for 15 years - due, at first, to government funding cutbacks. We already had a mild case of pneumonia before GM even started sneezing. And as the economy tanks, the corporate and individual funding is affected too.
I've experienced firsthand how sucky Michigan's economy has been the past few years in particular (through un- and uneremployment) -- although I still see plenty of people perhaps fiddling while Rome burns, buying their gas-guzzlers and their McMansions.
That said ... Yep, I drive a Japanese car. And love it. In fact, a lot of people in nonprofits drive Japanese. At my income level I need a *long-lasting*, economical, reliable car. [Oh, and I hate motorcycles - they're noisy bastards.]
Do any of you SE MI folks know about Oakland County's Automation Alley iniative? Is it geared toward encouraging non-auto related enterprises (which would be the smart thing)?
posted by NorthernLite at 6:34 AM on August 26, 2005
My girlfriend has a 3-year-old Ford Focus, bought new. In that time, the ignition switch has died, her doorlocks on the passenger side have died, her windows on the passenger side have died, her rear hatch door latch has broken, she's had the breaks (including shoes, rotors and pins) replaced twice, she's had to have work done on the steering column and to the fuel injection system (both malfunctioning chips), and she's had trouble with a leaking transmission fluid cylinder.
Luckily, most of these problems occurred while the car was under warranty. But c'mon, three years and 40k miles? That combined with the fact that the dealers have managed to on more than one occassion break something else while "fixing" one complaint, means that she'll never buy a Ford again.
On my '92 Toyota Tercel (with 180k), which I've owned about the same amount of time, I've had to replace the breaks once (and they could probably do for another replacement when I get the cash), and replace the engine and thermometer (the thermometer died, leading to an overheating and seizing, which threw a rod). Even in replacing the engine, I've spent less on repairs than she has and my car still runs pretty well. I don't feel nearly as burnt by my car, mostly because it was used and has a lot of miles on it. While I realize that it isn't perfect, it hasn't let me down yet.
posted by klangklangston at 8:50 AM on August 26, 2005
Luckily, most of these problems occurred while the car was under warranty. But c'mon, three years and 40k miles? That combined with the fact that the dealers have managed to on more than one occassion break something else while "fixing" one complaint, means that she'll never buy a Ford again.
On my '92 Toyota Tercel (with 180k), which I've owned about the same amount of time, I've had to replace the breaks once (and they could probably do for another replacement when I get the cash), and replace the engine and thermometer (the thermometer died, leading to an overheating and seizing, which threw a rod). Even in replacing the engine, I've spent less on repairs than she has and my car still runs pretty well. I don't feel nearly as burnt by my car, mostly because it was used and has a lot of miles on it. While I realize that it isn't perfect, it hasn't let me down yet.
posted by klangklangston at 8:50 AM on August 26, 2005
"[Oh, and I hate motorcycles - they're noisy bastards.]"
You live too close to the Harley-Davidson plant. :)
My Honda is almost dead-silent. You can converse in normal tones over the engine with it revved to 4000 RPM, and at highway speed I can barely hear the engine at all. Pretty much all bikes could be this quiet - but there's a lot of dudes out there who like a roaring bike. Have fun hearing your grandchildren, is what I say about them!
psmurray: "And spare us the motorcycle proseltyzing. If it works for you, fine. Americans won't even consider a small car, let alone a motorcycle."
The snotty tone is unnecessary, thanks. But hey, with the money I'm saving not spending $400/month on gas, $3,000 on insurance, $6,000+ on car payments and god knows how much more on maintenance etc., I can save up for my retirement AND to buy a house. So, have fun pissing your cash away on your SUV.
The price hikes in gas you're talking about via taxes are going to come about without the taxes. Gas is gonna go up pretty fast from here on out. Americans will change their tune pretty quickly.
posted by zoogleplex at 11:27 AM on August 26, 2005
You live too close to the Harley-Davidson plant. :)
My Honda is almost dead-silent. You can converse in normal tones over the engine with it revved to 4000 RPM, and at highway speed I can barely hear the engine at all. Pretty much all bikes could be this quiet - but there's a lot of dudes out there who like a roaring bike. Have fun hearing your grandchildren, is what I say about them!
psmurray: "And spare us the motorcycle proseltyzing. If it works for you, fine. Americans won't even consider a small car, let alone a motorcycle."
The snotty tone is unnecessary, thanks. But hey, with the money I'm saving not spending $400/month on gas, $3,000 on insurance, $6,000+ on car payments and god knows how much more on maintenance etc., I can save up for my retirement AND to buy a house. So, have fun pissing your cash away on your SUV.
The price hikes in gas you're talking about via taxes are going to come about without the taxes. Gas is gonna go up pretty fast from here on out. Americans will change their tune pretty quickly.
posted by zoogleplex at 11:27 AM on August 26, 2005
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posted by clevershark at 5:36 AM on August 25, 2005