Bailout over, for now. Any predictions?

How long will Chrysler survive?

So, the Big 2 have been given their bailout, although they were given an amount that was far less than they suggested they needed. Likewise, the bailout was for an amount far less than what many independent economists have claimed would be needed.

Thus, is this just the beginning? Will the Obama Administration and the new Congress erase some of the tougher requirements that Bush's bailout imposes, such as those on UAW wages? Will the bailout lead to a new, vibrant American auto industry? Will the bailout lead to a massive increase in hybrid cars and electric vehicles?

What are your predictions for the automakers bailout?

Majority still oppose auto bailout

Who does Congress represent?

According to a Washington Post poll, 55 percent of Americans still oppose a bailout for automakers, versus 42 percent that support a bailout. Those against the bailout believe that the US auto industry is nearing bankruptcy because of bad business practices, and that bankruptcy won't disrupt the economy too adversely.

I guess you can't blame the people. The auto industry and the UAW continue to accept little responsibility for the condition they are now in.

Yes, Toyota and Honda are now suffering, but they are still sitting on hordes of cash, and they have not been bleeding money for the last several years, unlike the Big 3. Likewise, if the UAW is so innocent, why did they accept major contract changes in recent years? Is that not proof that for decades UAW contracts were uncompetitive?

While I continue to support a bailout, begrudgingly, the Big 3 and the UAW continue to blame, rather than accept responsibility. That certainly isn't the way to appeal to Americans in fear of losing their jobs, pensions and health care funds - benefits which have never been as good as the UAW's for most.

Bailout downed in Congress

White House to the rescue

The Senate has rejected the automaker bailout 52 - 35. However, both the Treasury and the White House have indicated that TARP funds might now be used to save the Big 3 from bankruptcy.

Bailouts just the beginning if CAFE increased

Everything as efficient as the Prius under new Congress?

If you don't believe in an automaker bailout, you ain't seen nothing yet. Unless the economy quickly starts soaring, within the next few years, automakers could need as much as $120 billion according to recent Congressional testimony.

And, even if the economy warms, but car buying stays slow, the US auto industry isn't even "viable".

"At 10.8 or 10.5 million total market," for yearly auto sales, Bob Lutz told CNN, "we do not have a viable automobile industry in this country for anybody."

Yet, the push in Congress is to now raise fuel economy standards for the Big 3, under the direction of Congress. An aggressive increase in fuel economy means that US automakers won't be profitable for more than a decade, maybe decades. In fact, such a move will require significantly more money from the government beyond the $120 billion if the economy doesn't quickly and vastly improve.

Is socialization of the US auto industry now inevitable?

Bailout agreement today

There should be a short-term bailout agreement announced by the end of today according to many reports coming out of Congress that could be signed by the White House before the end of the week. Developing....

Green technology patents: The Big 3's trump card?

How do we get the technology out of the lab and into the real world

"General Motors, Ford and Chrysler are collectively one of the world's primary sources for the research and development of green and fuel-efficient technologies," notes a commentary in the DetroitNews. "As Washington decides on aid to the ailing auto industry, top consideration should be given to the significant potential of these Big 3 technologies for stimulating economic and job growth and creating a greener and more fuel-efficient world."

Interesting piece on the green technology patents owned by the US auto industry and how bankruptcy "would create a historically unique opportunity for their foreign competitors to acquire a vast amount of crown jewel technology for a fraction of their true value."

Bailout plan ready for Vote next week

"Jolted by the loss of thousands of jobs, congressional Democrats and the White House reached for agreement Friday on about $15 billion in bailout loans for the beleaguered auto industry. President George W. Bush warned that at least one of the Big Three carmakers might not survive the current economic crisis." (AP via Yahoo)

Not a lot of details yet available, other than that this is purely a stop-gap loan meant to get automakers into next year and the next administration.

Govt would have to fund Big 3 bankruptcy

No one has the money to fund a bankruptcy?

So, you want the Big 3 to go into bankruptcy to clean house? Alright. I was just watching some pre-coverage of the bailout testimony before Congress and analysts were discussing how there is no financial institution strong enough to finance the bankruptcy of the Big 3. Oddly enough, financing a bankruptcy would actually cost more than the bailout loans - and the bankruptcy wouldn't be a loan.

I don't know, folks. There is a lot of reason to hate the Big 3, I realize that. Still, we're giving hundreds of billions to just Citibank, and no one hardly says anything. Yet, when we try to help the auto industry - an employer of millions directly and indirectly - America wants to crush them? Does America really hate the UAW that much more than billionaire Wall Streeters?

Give the Big 3 a break, Take 1

Even Honda is getting hammered?

Both Toyota and Honda posted sales declines of over 30 percent in November compared to last year. While that wasn't as bad as GM or Chrysler, those numbers were roughly in line with Ford's numbers.

And, for those buying cars, would you buy a car from a company that was weeks away from bankruptcy without government help? I wouldn't.

Does that justify Detroit's years of SUV madness at the expense of a balanced product portfolio? Of course not, but all of these automakers had started making serious changes before the credit crisis - a crisis that is hurting all automakers, even those making hybrid cars and small cars.

This alone doesn't justify a bailout, but it adds a little perspective. More coming on Take 2.

Waxman to make life tougher for automakers?

Higher CAFE requirements coming?

If I had to make a wager, I'd bet that a bailout for US automakers is inevitable, despite the recent hardball from Democrats. While that might irritate most, relax a little if your focus is fuel economy and global warming.

Now that Henry Waxman has replaced John Dingell as the leader of the Energy and Commerce panel, tougher CAFE and global warming requirements for automakers now seem inevitable. If Democrats hold to their guns, a bailout can be a good thing.

F Congress: Give automakers the money

Or do I mean F America?

Congress is in a tough spot. The majority of Americans don't want Congress to help the US auto industry, despite the fact that all of the Big 3's competitors receive heavy subsidies from their governments.

I understand. For decades the Big 3 built a lot of crap and, even after 9/11, they still didn't react to fuel economy. Profit was more important than national security.

Nonetheless, Congress has to give automakers the money and, we the people, should accept that because we the people are also responsible for the state of the US auto industry. We bought the gas-guzzlers. We demanded that gas stay cheap. We voted for politicians that made gas taxes and increased fuel economy standards dirty word for decades.

I know. None of that justifies the failures of the Big 3, whom helped brainwash the people into gas-guzzling stupidity. And, I know most Americans want the corporate big wigs of America, including those from Detroit, to suffer. Yet, it will be average Americans - all over America - that will suffer most if Detroit goes under. Now is not the time to seek revenge, it's time to turn a wrong into a right.

Bail out automakers to save the Chevy Volt? Part II

I still love the Volt, but it's time for some reality

On Monday, after reading some stories supporting a US automaker bailout to save the Chevy Volt, I slammed the suggestion (more). It's not that I don't believe in the viability of the Volt, it's that I don't believe the Volt is the critical piece of this discussion.

After watching the CEO's of the Big 3 testify before Congress Tuesday, I believe that even more. Both Ford and GM insisted that the new CAFE requirements - 35 mpg by 2020 - were the absolute most achievable limit. Any new strings for the bailout, they argued, should not include higher fuel economy standards.

Hence, by 2020, most US-made vehicles will still be conventional vehicles - though conventional vehicles with direct injection and other technologies that will increase fuel economy - not vehicles like the Volt.

More important, while 35 mpg fleet fuel economy means foreign oil dependency from the Persian Gulf will be reduced by half, America will still be terribly dependent upon foreign oil in 2020. This reality, not the Volt, should be the focus of the bailout talks.

Why can't automakers help end foreign oil dependency by 2020? If EVs and hybrid cars can't get us there be 2020, what other technologies, fuels, etc. can get us there? Can cellulosic ethanol be significantly increased in the next 10 years? Can natural gas help? Something else?

The US auto industry needs government help, and I'm inclined to help. However, if the government and US tax payers are going to partner with the US auto industry to achieve success, why not strive for revolutionary success?

Auto suppliers ALSO need a bailout

An automaker bailout won't save suppliers

So, you're against an automaker bailout, but the loss of jobs is making you more open-minded. In particular, the idea that an automaker bankruptcy won't just result in automaker job loss, but auto supplier job loss has become alarming.

Well, according to a report Phil Lebeau made on CNBC a few minutes ago, an automaker bailout WON'T save auto suppliers. Regardless of any bailout for automakers, auto suppliers will need their own bailout according to Lebeau.

This story is apparently just breaking, so details are scarce. When asked about numbers, however, Lebeau guessed that auto suppliers would probably need as much as $15 to $20 billion from Congress - apart from any money Congress gives to the Big 3. Happy Monday!!!

Bailout automakers to save the Chevy Volt? No.

The Volt is not the reason to bailout GM

Today, Toyota makes a profit on all of its hybrid cars, thanks to the Prius. Yet, not one US automaker has developed a Prius-contender.

Rather than challenge the Toyota Prius directly, GM conceptualized a product to leapfrog Toyota - a perfect marketing coupe. Essentially, GM could claim that they didn't need to develop a car like the Prius because the Chevy Volt would be so much better than the Prius. This then gave GM time to keep rolling out gas-guzzlers as the technology caught up to the Volt concept.

Some have forgiven all of GM's past wrongs because of the Volt, and even believe that the entire US auto industry should be bailed out to protect the Volt. Yet, when will the Volt be profitable? When will GM be able to produce even 100,000 Volts per year? 5 years? 10 years?

More important, within 5 years, there is every reason to believe that numerous automakers might have products just as exciting as the Volt, even better than the Volt. Recently, even lowly Chrysler showed that they aren't that far behind the Volt.

Bailing out automakers solely for the Chevy Volt would the same kind of ignorance and denial that has put GM and the rest of the Big 3 in need of a bailout. A bailout MUST be about far, far more than the Volt.

Bailout v. bankruptcy: Which influences consumers more?

Does a bailout really appease auto consumers?

On Wall Street, most believe that bankruptcy is the best way to save the US auto industry for it will cut a lot of dead weight quickly. Those against such a plan claim that consumers won't buy from automakers that had to declare bankruptcy.

Perhaps. Still, will buyers - whom probably feel financially stressed and also in need of a bailout - feel so much more comfortable buying cars from automakers that needed massive government help to prevent bankruptcy? Might there not even be some anger transferred to such automakers?

Poll - Most Americans support an automaker bailout

At least Ford pickup owners do

I was just given the poll results from a Peter D. Hart Research Associates, Inc. survey that indicates the majority of Americans support a bailout.

First, it must be acknowledged that the Peter D. Hart group is a pro-Democrat group. Second, I was looking through the data, and there are some interesting things to note.

For instance, the number one vehicle type owned by the group interviewed was a pickup. That is, unless you bulk all SUVs into one segment. Then SUVs represented the most owned vehicle. 

The top two owned brands were Ford and Chevy. And, almost no one owned a hybrid vehicle. Politically, the largest group defined themselves as middle class Democrats.

I'm exaggerating a bit here, but this study seems to indicate that middle class Democrats whom buy American-made trucks and SUVs largely support an automaker bailout. Is that surprising?

Re: Why Americans hate Detroit

The icon of American stupidity

Was it intelligent or morally ethical for GM to develop the Hummer brand as it was dismantling the EV1 program?

Of course not. It was asinine to anyone that cared about foreign oil dependency or the environment. Unfortunately, at the time GM rolled out the Hummer instead of the EV1, MOST Americans didn't care about either global warming or the environment.

So, GM followed the American ideal - "Show me the money."

Today, Republicans in Congress are aghast at the idea of an automaker bailout. Yet, I bet most of them drive gas-guzzlers.

There is no doubt the Big 3 have demonstrated little leadership in fighting global warming and foreign oil dependency, and Americans hate that because it's a reminder of how stupid most American consumers have been acting. Blaming it all on the Big 3 while that big gas hog sits in the driveway is so much more convenient.

Isn't a Volt delay inevitable?

All about the battery

GM is on life support. Without government money, bankruptcy is inevitable. Yet, GM has made it clear that not only is work on Chevy Volt development ongoing, but that more resources and money are being put into the Volt - the icon of GM's future.

Still, the most critical element of the Volt's success - the lithium-ion battery - is dependent upon technologies not wholly owned by GM. Ultimately, the battery supplier is almost just as important as anything GM is doing.

Isn't it, therefore, reasonable to assume that Volt suppliers might proceed cautiously and slowly until the viability of GM is guaranteed?

Vue 2 mode hybrid launch date scrubbed?

Dependent on the bailout?

Back in April I found myself sitting next to Bob Kruse, Executive Director of Vehicle Integration and GM Performance Division, at a dinner hosted by GM for a media update on the Chevy Volt.

Turns out Kruse had been driving the soon-to-be-released Saturn Vue dual mode hybrid, a vehicle Kruse was pretty excited about. In fact, he told me that although the numbers had not yet been finalized, the Vue dual mode was testing 70 percent more fuel efficient than a conventional Vue in city driving.

More important, by the end of 2008, GM would begin selling the Vue dual mode, Kruse confirmed.

Today, GM notified me that the Vue dual mode hybrid is set to go on sale some time in Q1 2009. This Vue of GM's future, it seems, is now completely dependent upon an automaker bailout.

Global warming goes away if Big 3 go under?

Kill Detroit, kill CO2 emissions?

Despite my previous bailout post, I'm still an advocate of an automaker bailout with strings. A new string that environmental activists are now advocating is a bailout only if the Big 3 drop their suit against California and its desire to regulate CO2 emissions - an interesting idea.

Yet, I have some questions. Why are autos the environmental whipping boy? Don't houses and buildings cause far more environmental damage? Doesn't the food industry, especially the meat industry, cause more environmental damage?

Anyway. If automakers go bankrupt, do CO2 emissions go down? Does not bankruptcy only ensure that we drive gas-guzzling polluters longer?

F Wall Street - Give GM the money

At least GM has something to offer

I've not been a big fan of an automaker bailout, unless used to make the Big 3 significantly more efficient. Earlier today, I even argued the bailout MUST include strings.

Well, I've changed my mind. Give GM the money.

Does GM deserve it? I don't care. If not for the Wall Street-created financial crisis GM wouldn't need any bailout money. Instead, we could just be angry at them for not making enough fuel efficient vehicles.

Still, if GM was selling two hybrid cars as successful as the Toyota Prius - for as long as Toyota has been selling hybrids - GM would STILL be facing bankruptcy.

GM is facing bankruptcy because of Wall Street. Yet, Wall Street is leading the charge to bankrupt the US auto industry? Please. The automaker bailout isn't even chump change compared to the money being spent on the chaos caused by Wall Street. At least GM sells a real product, unlike the expensive lies Wall Street sells.

Gas prices - Why strings MUST be attached to any bailout

Detroit still far behind the Prius

Pop open the bubbly, ladies and gentlemen, it's party time. In 4 states gas has fallen below $2.00 per gallon. On Wall Street, the overwhelming consensus is $50 oil before $65.

But, is that a good thing?

When gas was $2.00 US automakers laughed at the Toyota Prius. Today, the Prius has already sold more than 1,000,000 Prius hybrid cars, yet there won't be one US made Prius-contender on the road until late 2010 with the Chevy Volt. Moreover, GM probably won't be selling the 100,000 Volts per year until at least 2014.

Fortunately, if gas prices remain low, America's gas-guzzling will decline thanks to CAFE, but CAFE regulations won't be strong enough to end foreign oil dependency. Unfortunately, as history as proven, US automakers will simply do as much as needed to achieve CAFE, and when foreign oil dependency again rears its ugly head, America will again be unprepared.

Thus, a bailout must include strings.

LeBeau - Automakers open to fuel efficiency strings for cash

Time to make the best out of this bailout?

During CNBC Reports just a few minutes ago, Phil Lebeau - whom interviewed GM CEO Rick Wagoner this morning - stated that US automakers would be open to fuel economy strings for government cash.

Seems like a positive sign, and an angle that Congress should exploit.