It looks like the miserable shape of our economy is taking a toll on everyone (is that a surprise?), including foreign automakers!
Honda is expected to report a $1.4 billion second-half loss, after cutting their full-year operating profit by 67%. The reasoning for this is in part due to a slump in demand and the rise in value of the Yen. In its defense, Honda did have a $2 billion first-half profit, so it will end up with a net profit at the end of the year. Coincidentally, Ford also had a profit of $100 million for the first quarter of 2008, signifying that the company is on its way to turning around.
Speaking of the pot calling the tea kettle black; maybe Richard Shelby will tear into Honda and its business structure? Nah, who am I kidding…
-Alex
I was going to create a giant post with a look into the two-faced policies of Alabama Senator Richard Shelby, but now I don’t have too. I website has been setup by a GM retiree which put’s Shelby’s actions in the limelight. Take a look here: http://www.BoycottAlabamaNow.com/
-Alex
You’ve already been providing financial assistance to foreign automakers!
Source: Detroit Free Press
So you’re against the automaker “bailout?” But did you know that taxpayers (i.e. you, if you’re a US citizen) have already provided financial support to foreign automakers, right here in the good ol’ USA?
As Stephen Collins states in his editorial Tax Fairness for U.S. Automakers, the U.S. automakers are asking for financial support on the order of $16,000 spread amongst approximately 240,000 employees (for all three automakers). In comparison, the state of Tennessee has offered Volkswagen tax incentives and other subsidies to the tune of $577 million, which equates to $288,000 for every job created.
Similarly, Toyota is getting its share, equaling $300 million for building a plant in Texas, which works out to $150,000 per employee. And in Alabama, Hyundai, Toyota, Honda, and Mercedes are getting incentives equal to $111,000 per employee.
But there is a difference between the financial support that the domestic automakers are asking for and that received by the foreign automakers: the loans provided to the domestics are going to be paid back, whereas the incentives provided to the foreign companies will never be paid back.
If you ask me, I think the financial support is worth it…
-Alex
Source: Tax Fairness for U.S. Automakers
I know this is relatively old, but this site was formed after Peter Karmanos Jr., Chairman and CEO of Compuware Corporation in Detroit, wrote the following letter to Richard Shelby, Republican Senator in Alabama and major critic to providing financial support to the automakers.
Peter Karmanos Jr. lays out the hypocritical antics of Richard Shelby, which show that he has nothing but disdain for the American automakers.
Read his letter by clicking “read more.” Read the rest of this entry »
