The Big 3 Auto bailout

[minnie61650]

I am proud to be a citizen of the U.S.A.
I am proud to support my county, my states (I have homes in both Michigan and Florida), and my communities.
I am proud to Support the Detroit Automakers.
I am proud to support Michigan and Florida companies and charities.
I am proud to support local bussiness and charities.

Yes, Toyota and Honda do have some plants in the US and do employ many Americans. They are not however American Companies.

When I buy an auto from one of the Detroit 3 I am helping to keep my fellow Michigander's employed.
I am helping to keep tax dollars coming in for all the services that are vital to our communities.

I posted this on a few other threads:


Over the last several years the Detroit 3 have been downsizing. Many thousands of auto employees were let go. Some were given early retirements others were laid off.
As a result Michigan's job loss is the longest since the Great Depression.

Here is an article that supports my claim:

Michigan's job-loss streak is the longest since Great Depression and that title was taken from an article which was written in Nov. 2006.

http://www.ns.umich.edu/htdocs/releases/story.php?id=1069

Nov. 17, 2006

Michigan's job-loss streak is the longest since Great Depression

ANN ARBOR, Mich.—Michigan has endured six straight years of job losses and the next two years will see even more—the longest stretch of employment loss in the state since the Great Depression, say University of Michigan economists.


Since mid-2000 to the end of this year, the state will have lost 336,000 jobs and it will lose another 33,000 jobs in the next two years, they say. Most of these losses are in manufacturing.

Moreover, unemployment in Michigan is projected to rise from an average of 6.8 percent this year to 7.5 percent next year and 7.7 percent in 2008—the highest rates since 1992.

Our unemployment was 8.5% in May of 2008. By October 2008 our employment was 9.3%.

In November2008 our unemployment rose to 9.6%

Link: http://www.bls.gov/EAG/eag.mi.htm

Many, many small businesses and local stores as well as many chains have closed.
Many of shopping centers have vacant stores. Many of our neighborhoods have vacant homes.

Cutbacks of many of our State services have taken place :



From this article:

http://www.policeone.com/police-products/training/articles/1697311-Police-cutbacks-rock-Michigan/

Police cutbacks rock Michigan

By Tim Martin
The Associated Press

May 21, 2008
DETROIT — Michigan's law enforcement agencies are fighting crime with about 1,800 fewer police officers than in 2001, and the consequences are showing up on city streets and country highways.

Violent crime is up in some areas, but arrests are down in part because police departments — with about 21,300 positions statewide, an 8 percent drop — can't keep up with the increased workload. During the same time frame, the state's population has stayed roughly the same.


The cuts have been most severe in many of the state's largest cities and smallest towns, according to data from the Michigan Commission on Law Enforcement Standards.

Citizens sometimes wait hours for an officer to respond to a property crime and more state highways go unpatrolled for long stretches at night. Support staff has been slashed, too, so police officers working high priority cases sometimes face a tougher time getting experts who can help build cases by giving polygraph tests or investigating questionable fires.

State crime labs often have a four-to-six month turnaround time on DNA evidence found at crime scenes, and it takes a few months longer in some cases. It's a shorter average delay than a few years ago but still long enough to leave many investigations that rely on forensic evidence hanging.

The state's 16 law enforcement agencies that employ 100 or more officers collectively have lost 15 percent of their law enforcement positions since 2001, according to the Michigan Commission on Law Enforcement Standards.

Some cities are looking at cutting police staffs even further as local governments struggle to pay for patrols. Tight tax revenues - caused in part by Michigan's long-struggling economy - are blamed for police layoffs from southeast Michigan's big cities to small, rural communities in the Upper Peninsula.

"We're stretched thin," said Sheriff Brian McLean of Houghton County, which pokes north into Lake Superior. "A lot of criminals, the halfway bright ones anyway, are realizing that."..........

Here is an article about Michigan's troubled schools:

Thursday, February 1, 2007
State cuts could push 20% of school districts into the red

Jennifer Mrozowski / The Detroit News

Nearly one-fifth of Michigan's school districts could be in deficit by the school year's end if the state cuts per-pupil funding by $224, according to a survey by the Michigan School Business Officials.

The statewide organization, which represents more than 1,800 school business officials, surveyed districts this month.

It found that about 120 districts would fall into deficit if cuts are made to address a state shortfall of about $1 billion this year.


"Part of the frustration is that here we are in the middle of the school year, trying to educate kids and now we have to focus on cuts," said Tom White, executive director of the Lansing-based association.

If a district falls into deficit, it has to create a reduction plan outlining how to eliminate the shortfall. Districts in deficit often face teacher lay-offs, higher pay-to-play fees, larger class sizes or less money for programs.

White said his office sent surveys to the state's 524 K-12 public districts and some charters.

Richard Witkowski, superintendent for Garden City Schools, said his district ended the 2005-06 year with a $1.3 million deficit. The 5,400-student district's budget for this year is $46 million.

Since 2001, the school system has closed a middle school, privatized food and custodial services, reduced administrative and clerical staff and cut ninth-grade sports and elementary band.

"Trying to cut back another $1.1 million would be devastating to our district," Witkowski said. <snip>



The survey also found that if there is no increase in the foundation allowance for the 2007-08 year, 28 percent, or 168 districts, would be in deficit. In addition, 53 percent -- 318 districts -- would cut their workforce by five percent or more and 70 percent, or 420 districts, would reduce programs for students.

Hildy Corbett, spokeswoman for Utica Community Schools, said the reduction in per-pupil aid could mean cutting $6 million from the district's $255 million budget.

The school system has been chipping away at its fund equity for the last four years, and has already had a series of layoffs that trimmed more than 60 staff members, including teachers. The 30,000-student system also closed a building that was being used for preschool.

"At this point, we don't have a plan to deal with any additional reductions," Corbett said. "We're still crying the cry that we need stable revenue for districts and children."

The system is weighing all options, she said.

In Detroit Public Schools, the per-pupil reduction could mean a loss of around $20 million, said Dori Freelain, the district's chief financial officer. The system already is trying to eliminate a $200 million deficit.

"We would be in a very severe situation," Freelain said. She could not say what areas the district would cut. But the system doesn't have much leeway with staffing because of employment and labor contracts and because the cuts would not be in response to a greater decline in enrollment, she said.

"It would generally mean we would take a hard look at current spending and place some serious controls on spending patterns and spending levels by year's end," Freelain said.

You can reach Jennifer Mrozowski at (313) 222-2269 or jmrozowski@detnews.com.

From the Govenor's FAQ website:

http://www.michigan.gov/gov/0,1607,7-168--81249--,00.html

Frequently Asked Questions About the Budget

How large is the budget deficit and why do we have another deficit after the Governor just cut $1 billion from the current budget?

Answer: The budget deficit in the General Fund and the School Aid Fund combined is currently about $920 million. Yes, the Governor just recently approved budget cuts for the current fiscal year that totaled more than $1 billion. The main problem is that the current budget was written based on economic forecasts that showed the nation rebounding from the current economic slump sooner. The country still has not recovered, and Michigan’s manufacturing-based economy is still suffering. Michigan has lost more than 300,000 jobs since 2000, including 170,000 manufacturing jobs.

When workers lose their jobs, the state loses funds from two important sources of revenue – the income tax and the sales tax.

 

[frisco]

I am proud to be a citizen of the U.S.A.
I am proud to support my county, my states (I have homes in both Michigan and Florida), and my communities.

I don't think buying a foriegn car means you aren't proud to be an American. It just means you'd rather not waste the time or money that comes with buying a car that spends more time in the shop than it does on the road.

 

[ols386]

I've always purchased GM vehicles...have had some minor problems with some, but nothing drastic. I understand when people buy American-made vehicles and do have a lot of problems with them, that it is very frustrating. When you spend that much money on a new vehicle, it should run with little or no problems. I agree that the American car companies need to get their act together, but I still won't buy from a foreign car company. I know they provide alot of jobs here in the U.S., and that's great, but I still think that if I purchase a foreign car vs. a U.S. car, it's not helping the U.S. economy 100%. It's still putting money into another country's economy, to a certain degree, and I want my money to benefit the U.S. I just hope American car companies can turn things around, for the good of everyone in the U.S.

 

[bradisgoofy]

Bravo Linda. That was even better then my original post. I'm not here to flame anyone but the ONLY reason the foreign auto makes built plants here is to MAKE MONEY. There hasn't been a real quality issue with the BIG 3 since the 70s. People have every right to buy whatever make of automobile they wish, but the American economy is tied to the BIG 3 and if they fail, so does every supplier, dealer and parts store in the country.

 

[frisco]

Bravo Linda. That was even better then my original post. I'm not here to flame anyone but the ONLY reason the foreign auto makes built plants here is to MAKE MONEY. There hasn't been a real quality issue with the BIG 3 since the 70s. People have every right to buy whatever make of automobile they wish, but the American economy is tied to the BIG 3 and if they fail, so does every supplier, dealer and parts store in the country.

I'd have to disagree.

Like I said, I've had issues with every American auto I've owned. My father bought an '08 Buick Lecerne (?) last year, and it's been in the shop 5 times for the same problem. We could just have really bad luck, but with the 2 foriegn cars I've owned, never had a problem with them.

It'll be devestating if the Big 3 is to fail, no one is denying that. But it's unfair to place the responsibility on consumers. No one is to blame but the Big 3. People aren't going to start buying American Autos again until they become more dependable.

 

[bicker]

I think, besides being inaccurate (as a later poster pointed out) the OP really points out a red herring: People choose what to purchase based on what offers them the best product/service at the best price. I often point out that consumers sometimes are too maniacally focused on price, to the exclusion of features and quality. However, features, quality and price are the only criteria of a purchase that customers should feel compelled to consider.

Charity begins at home, and so the manner in which charity enters into the mix is how much of your own resources you donate to charity. Generosity channeled to charities through the price you pay for products and service, out the back of the company you're doing business with, through their own charitable foundations and such -- well that's just a silly (and inefficient) way of being generous.

I think everyone sympathizes with people who lose their jobs, at least at some level. I'm sure that if I posted a message about when I was laid off ten years ago there would have been people who sympathized with me, as well. However, I don't expect that they would have boycotted a competitor of the company that laid me off, regardless of which company was more generous with charities.

The Big 3 automakers know how to become the choice of the American car-buyer. I alluded to it above: features, quality and price. There is enough smarts in the Big 3 to bring about features and quality, as necessary. The problem is just price; oh they can sell at the necessary price-point, but if they do, they sell each car at a loss, because their cost structure is too high. And why is the cost structure so high? Yup, you guessed it: The unions.

 

[TiggerCat]

We've owned several "Big three" cars and it won't happen again until their product quality improves. I will not, and simply can not, make a major purchase based on a companies charitable contributions. I will base it on quality, warranty, design, and customer satisfaction.

Regardless, I am truly sorry that they are laying you off. I pray the economy turns around quickly and you are reinstated soon.

Ditto. We used to always buy from the original "Big Three" but ceased doing so when we starting getting a garbage product that wasn't supported by the manufacturers. I for one cannot understand why the legislators' are so eager to hand over our money to companies that make products that we do not wish to buy. They are only postponing the inevitable bankruptcies that come from such inefficiencies.


TC.

 

[golfgal]

So, what is more "American" a Japanese company that has assembly plants in the US or an American company that assembles cars in Mexico and Canada?

 

[minnie61650]

This was posted in the Detroit Free Press:

7 myths about Detroit automakers
BY MARK PHELAN • FREE PRESS COLUMNIST • December 5, 2008

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This column by Free Press auto critic Mark Phelan originally was published on Nov. 17 and has been updated.


The debate over aid to the Detroit-based automakers is awash with half-truths and misrepresentations that are endlessly repeated by everyone from members of Congress to journalists. Here are seven myths about the companies and their vehicles, and the reality in each case.

Myth No. 1: Nobody buys their vehicles
Reality: General Motors Corp., Ford Motor Co. and Chrysler LLC sold 8.5 million vehicles in the United States last year and millions more around the world. GM outsold Toyota by about 1.2 million vehicles in the United States last year and holds a U.S. lead over Toyota of nearly 700,000 so far this year. Globally, GM in 2007 remained the world's largest automaker, selling 9,369,524 vehicles worldwide -- about 3,000 more than Toyota.

Ford outsold Honda by about 850,000 and Nissan by more than 1.3 million vehicles in the United States last year.

Chrysler sold more vehicles here than Nissan and Hyundai combined in 2007 and so far this year.

Myth No. 2: They build unreliable junk
Reality: The creaky, leaky vehicles of the 1980s and '90s are long gone. Consumer Reports recently found that "Ford's reliability is now on par with good Japanese automakers."

The independent J.D. Power Initial Quality Study scored Buick, Cadillac, Chevrolet, Ford, GMC, Mercury, Pontiac and Lincoln brands' overall quality as high as or higher than that of Acura, Audi, BMW, Honda, Nissan, Scion, Volkswagen and Volvo.

J.D. Power rated the Chevrolet Malibu the highest-quality midsize sedan. Both the Malibu and Ford Fusion scored better than the Honda Accord and Toyota Camry.

Myth No. 3: They build gas-guzzlers
Reality: All of the Detroit Three build midsize sedans that the Environmental Protection Agency rates at 29-33 miles per gallon on the highway.

The most fuel-efficient Chevrolet Malibu gets 33 m.p.g. on the highway, 2 m.p.g. better than the best Honda Accord. The most fuel-efficient Ford Focus has the same highway fuel economy ratings as the most efficient Toyota Corolla. The most fuel-efficient Chevrolet Cobalt has the same city fuel economy and better highway fuel economy than the most efficient non-hybrid Honda Civic.

A recent study by Edmunds.com found that the Chevrolet Aveo subcompact is the least expensive car to buy and operate.

Myth No. 4: They already got a $25-billion bailout
Reality: None of that money has been lent out and may not be for more than a year. In addition, it can, by law, be used only to invest in future vehicles and technology, so it has no effect on the shortage of operating cash the companies face because of the economic slowdown that's killing them now.

Myth No. 5: GM, Ford and Chrysler are idiots for investing in pickups and SUVs
Reality: The domestics' lineup has been truck-heavy, but Toyota, Nissan, Mercedes-Benz and BMW have spent billions of dollars on pickups and SUVs because trucks are a large and historically profitable part of the auto industry.

The most fuel-efficient full-size pickups from GM, Ford and Chrysler all have higher EPA fuel-economy ratings than Toyota and Nissan's full-size pickups.

Myth No. 6: They don't build hybrids
Reality: The Detroit Three got into the hybrid business late, but Ford and GM each now offers more hybrid models than Honda or Nissan, with several more due to hit the road in early 2009.

Myth No. 7: Their union workers are lazy and overpaid
Reality: Chrysler tied Toyota as the most productive automaker in North America this year, according to the Harbour Report on manufacturing, which measures the amount of work done per employee. Eight of the 10 most productive vehicle assembly plants in North America belong to Chrysler, Ford or GM.

The oft-cited $70-an-hour wage and benefit figure for UAW workers inaccurately adds benefits that millions of retirees get to the pay of current workers, but divides the total only by current employees. That's like assuming you get your parents' retirement and Social Security benefits in addition to your own income.


Hourly pay for assembly line workers tops out around $28; benefits add about $14. New hires at the Detroit Three get $14 an hour. There's no pension or health care when they retire, but benefits raise their total hourly compensation to $29 while they're working. UAW wages are now comparable with Toyota workers, according to a Free Press analysis.

Contact MARK PHELAN at 313-222-6731 or phelan@freepress.com.

Link:

http://www.freep.com/apps/pbcs.dll/article?AID=2008812050400

 

[jodifla]

I'd have to disagree.

Like I said, I've had issues with every American auto I've owned. My father bought an '08 Buick Lecerne (?) last year, and it's been in the shop 5 times for the same problem. We could just have really bad luck, but with the 2 foriegn cars I've owned, never had a problem with them.

It'll be devestating if the Big 3 is to fail, no one is denying that. But it's unfair to place the responsibility on consumers. No one is to blame but the Big 3. People aren't going to start buying American Autos again until they become more dependable.

That's surprising about the Lucerne. One of my BF has one, and she just loves it. No problems, and it's an 06 (or the first year they made them...)

 

[minnie61650]

Here are some stats that I was able to find about the Detroit 3 and the other auto companies:

These stats are from 2007.
Since that time the Big 3 have downsized even more and I cannot find more recent stats.


In 2007, the Big Three sold 18 million autos .

In 2007, Toyota and Honda sold 12.2 million autos.


I found a new stat:The overseas automakers produce more than 3 million vehicles a year at U.S. plants.

Does anyone know how many of the 18 million autos made by the Big 3 were made in the U.S.?

Take a look at this article:

Why Toyota wants GM to be saved
A GM failure would cause production problems, crush already weak demand and potentially open the door to low-cost competitors.

Last Updated: December 16, 2008: 9:53 AM ET


NEW YORK (CNNMoney.com) -- Detroit's Big Three aren't the only automotive companies that want to see the government step in with some much-needed financial help. <SNIP>


The overseas automakers, who between them produce more than 3 million vehicles a year at U.S. plants, all worry their production would be hurt if one of the U.S. automakers went under. That's because a Big Three failure would likely lead to widespread bankruptcies in the auto parts supplier industry.

<SNIP>

Full Link:

http://money.cnn.com/2008/12/15/news/companies/overseas_automakers/index.htm

In the US, the Big Three directly employ 242,000 people and an estimated 2.5 to 3 million indirectly.

Another stat:

GM has cut its payroll drastically, by 45.8 percent in the U.S. alone since 2000. In fact, GM is far from the largest employer in the industry. With 252,000 employees worldwide, GM ranks fifth overall behind Volkswagen (373,400 employees,) Renault/Nissan (316,121 employees,) Toyota (316,121 employees) and Daimler (272,382 employees). Yet GM sold more vehicles worldwide last year than any other automaker.

 

[frisco]

That's surprising about the Lucerne. One of my BF has one, and she just loves it. No problems, and it's an 06 (or the first year they made them...)

I think getting a lemon can happen with any car. What I look at is on average how a car's reputation is after a year or 2.

Good analogy - My wife has a Jeep Patriot. I have a Toyota RAV-4. Both 2008's. Very comparable models. Cost is the same. When we go to trade them in in 3 years, the RAV-4 will be worth $4,000 more.

 

[DisneySaver28]

So, what is more "American" a Japanese company that has assembly plants in the US or an American company that assembles cars in Mexico and Canada?

ITA! How is are "supporting US jobs" when a lot of the assembly employs people from other countries?

 

[edwardsfire]

Not from me. I agree 100%.

I think the bailout is a joke. If my company screws up and fails, no one's coming to bail us out. Won't matter anyways. The Big 3 have been making garbage for years, knowing full well this day would come. They'll continue to make garbage.

Agreed. im not a fan of the bailouts at all.

 

[silmarg]

I have zero vested interest on the topic (I dont work for an automaker nor do any of my relatives), but why not buy an American car? Their quality is quite good, their prices are great, and if we dont buy their cars they will really go out of business and this economy will really be in trouble if that happens.

I find it kind of scary how few Amercian cars there are in the NY metro area. There are folks in my office that think I am crazy that I only own (and have only ever bought) American cars. But I feel if a comparable product is made here (even by well paid workers) then why not buy it (vs one that may not made here)?

(When I special ordered a 2000 GMC Yukon that was being built in Wisconsin and Mexico I told the dealer I would refuse the car if it were Mexican built.)

I certainly hope that people would value the services I provide that they would want to buy from me versus some one thousands of miles away.

Let me get off my soap box now.

 

[minnie61650]

Just because I'm a proud owner of Toyota, doesn't mean I don't support my country!

I never said anyone who drove a Toyota, a Honda, or any other auto was not supporting our country!

I said:

I am proud to Support the Detroit Automakers.

Perhaps for reasons of your own you do not wish to support the Detroit 3.

That is your choice.

I choose to buy products made in the USA whenever possible.
That is my choice and I am proud of it.

 

[edwardsfire]

I have zero vested interest on the topic (I dont work for an automaker nor do any of my relatives), but why not buy an American car? Their quality is quite good, their prices are great, and if we dont buy their cars they will really go out of business and this economy will really be in trouble if that happens.

I find it kind of scary how few Amercian cars there are in the NY metro area. There are folks in my office that think I am crazy that I only own (and have only ever bought) American cars. But I feel if a comparable product is made here (even by well paid workers) then why not buy it (vs one that may not made here)?

(When I special ordered a 2000 GMC Yukon that was being built in Wisconsin and Mexico I told the dealer I would refuse the car if it were Mexican built.)

I certainly hope that people would value the services I provide that they would want to buy from me versus some one thousands of miles away.

Let me get off my soap box now.

Just remember though: Most of Honda's and Toyota's ARE made in the USA. With over 80% parts content also made in USA.
Our Odyssey for example is made in Alabama.
The Accord, Ohio
They are very much American cars.

 

[Bobbles]

I don't understand the same old tired line of American cars being "garbage".

The poor quality assumption may have been more realistic 15 - 25 years ago but quality has improved greatly since those days.

JD Powers ranking show a different take than those who make the poor quality assumption.

Maybe I have been luckier than most when it comes to cars.

 

[frisco]

JD Powers ranking show a different take than those who make the poor quality assumption.

That's because JD Powers ranks brand new cars when they first come out. Of course they'll rank well.

Check the same cars in 3 years in the same magazine.

My friend and I are always joking about this. Not about the bailout, because it's not funny, but about these reviews of new cars.

 

[minnie61650]

Detroit 3 cars made in USA:

Consumer Buying Guide - 2007 Cars and Trucks

Buick Lucerne
Cadillac CTS
Cadillac DTS
Cadillac STS
Cadillac XLR
Chevrolet Cobalt
Chevrolet Corvette
Chevrolet Malibu
Chrysler Sebring
Dodge Avenger
Dodge Caliber
Dodge Viper
Ford Five Hundred
Ford Focus
Ford GT Ford Mustang
Lincoln Town Car
Mazda Mazda 6
Mercury Montego
Mitsubishi Eclipse
Mitsubishi Eclipse Spyder
Mitsubishi Galant
Pontiac G5
Pontiac G6
Pontiac Solstice
Pontiac Vibe
Saturn Aura
Saturn ION
Saturn Sky
Toyota Corolla *

UAW PICKUPS
Chevrolet Silverado *
Chevrolet Colorado
Dodge Ram *
Dodge Dakota
Ford F-Series *
Ford Explorer Sport Trac
Ford Ranger GMC Sierra *
GMC Canyon
Isuzu i-Series
Lincoln Mark LT
Mazda B-series
Mitsubishi Raider
Toyota Tacoma *

UAW SUVs/CUVs
Buick Enclave
Cadillac Escalade
Cadillac Escalade ESV
Cadillac SRX
Chevrolet Suburban *
Chevrolet Tahoe
Chrysler Aspen
Dodge Durango
Dodge Nitro
Ford Escape/Escape Hybrid
Ford Expedition
Ford Explorer
GMC Acadia
GMC Yukon XL
GMC Yukon/Denali
Hummer H1 Hummer H2
Hummer H2 SUT
Hummer H3
Jeep Commander
Jeep Compass
Jeep Grand Cherokee
Jeep Liberty
Jeep Patriot
Jeep Wrangler
Lincoln Navigator
Mazda Tribute
Mercury Mariner/Mariner Hybrid
Mercury Mountaineer
Mitsubishi Endeavor
Saturn Outlook
Saturn VUE

UAW VANS
Buick Terraza
Chevrolet Express
Chevrolet Uplander
Chrysler Town & Country *
Dodge Caravan/Grand Caravan *
Ford Club Wagon Ford Econoline
GMC Savana
GMC Savana Cargo
GMC Savana Passenger
Saturn Relay
Ford Freestyle

From this link:

http://www.uaw.org/uawmade/auto/2007/index.cfm