truth about domestics

Rick Wagoner (GM)

General Motor’s CEO, Rick Wagoner, has been asked to step down by the Automotive Task Force in Washington D.C.  For the full story, and Mr. Wagoner’s press release, head on over to Autoblog.

Now that I got the official business out of the way, it’s time for one of my legendary rants.  Sure someone needs to take the blame for GM’s current position.  I mean, Rick Wagoner should have seen this coming.  Not only is GM producing it’s highest quality line of vehicles ever, they’re also the most fuel efficient, safest and most technologically advanced.  Plus, I mean, it’s totally GM’s fault that the banks collapsed, people can’t get financing to buy vehicles, gas prices hit $4+ last summer and the housing market is in shambles, so might as well blame all that on Rick Wagoner too.  Hey, wait a second!  Wasn’t Rick Wagoner CEO during 9/11?  We might want to look into that, maybe we can blame that on him too.

Glad to see that Washington thinks that because the market sucks and people aren’t buying cars, that it’s all Rick Wagoner’s fault.  If it were true that GM isn’t doing anything right, then they wouldn’t outsell Toyota and Honda and Nissan in the United States.  They wouldn’t be the second largest automaker in the world.  They wouldn’t sell cars like the Chevrolet Cobalt that gets better fuel economy than the Honda Civic or the Toyota Corolla.  They wouldn’t propose an idea like the Chevrolet Volt, a car that is expected to average 100 mpg (energy equivalent) when it’s launched late in 2010.  Sure, Mr. Wagoner could have done more.  He could have cut more jobs, he could have made more production cuts.  I hear and read hundreds of comments like that every day.  All from people who are using what they know today to look back 3 years and cast judgement.  If you were the CEO back in 2007, would you have started cutting jobs when the company was starting to show signs of improvement?  Would you have cut new product plans because, 1 year down the road gas was going to skyrocket to more than double it’s price at the time?  To anyone who says yes, I say, “bullshit.”  There was no way anyone could have seen the market collapse coming, or the high gas prices, or the lack of credit from the banks.

Hopefully Obama doesn’t abandon the Domestic automakers to the point of bankruptcy.  It sure looks as though it’s headed that way.  Oh, and to anyone who still doesn’t think the auto industry affects them, check the stock market.  I don’t care if you don’t own a share of Ford, GM or Chrysler stock, look at the market.  Rick Wagoner steps down, analysts say GM and/or Chrylser could be headed for bankruptcy and boom, the market drops 250+ points.  Weird…I didn’t think the Domestic manufacturers mattered to this country…yet their negative news spread throughout the market, causing wide spread panic and more selling.  Maybe when GM and Chrysler said they support directly and indirectly over 1 million jobs, they were telling the truth!  Are investors worried that their collapse would cause other businesses to fail?  You’re damn right they are!  Now where’s my blood pressure medication…

GM - UAW (GM)

General Motors and the United Auto Workers union have reached a tentative agreement on contract changes for the 62,000 workers and are still negotiating on the retiree health-care fund.  Ford’s contract changes saved them a reported $500 million and GM is expecting to save double that, close to $1 billion dollars.  This is good news as GM tries to cut costs to convince President Obama’s auto task force to free up another $16.6 billion in government loans to keep the automaker out of bankruptcy.  For the full story, as well as Ford’s reaction to the news, head on over to Bloomberg.

President Obama

Members of the Obama administration’s autos task force will be touring various facilities in Detroit today.  Activities include a test drive of the Chevrolet Volt extended range electric vehicle and also a tour of Chrysler’s pickup truck factory in Warren.  For the full story head on over to The Associated Press.

To be honest, I’m not a fan of this “Auto Task Force” that has been put together to figure out what’s best for the domestic auto industry.  First off, the group is led by Wall Street financier Steven Rattner and Steelworkers union official Ron Bloom.  I don’t know about you, but what is a person from Wall Street doing there?  The banks received huge loans without hardly a single question asked, and they made a much bigger error than the Domestic 3 did.  When was the last time that the steelworkers union was big in this country?  We get a large portion of our steel from overseas because we let our own steel industry die off, similar to what is going on in the auto industry.  If this crap continues, there will be no high paying jobs left in America, we’ll all be buying Chinese cars, made with Chinese steel, praying that we don’t get in an accident because it will end up looking like this.

Car Czar

According to an article in the New York Times, President Obama has dropped the idea of appointing a single, powerful “car czar” to oversee the turn-arounds of General Motors and Chrysler.  The idea originally popped up when the automakers went to the government for large bridge loans, totaling over $17.4 billion.  After being made to look like fools for giving the banking industry over $700 billion without a way to track the money, the federal government decided to take out their frustration on the auto industry.  You can find the full story at the NYTimes.