All Entries Tagged With: "CHRYSLER"
Clarkson Says No Bail Out For Detroit Three; Calls Chrysler “Two Bit…grumble, grumble”
The End Is Nigh!
By Gunnar Heinrich | IMG via BBC
SIR JEREMYis being an ass.
Adding his popular voice to the chorus of navel gazing doomsayers, Mr. Clarkson pontificated on Detroit and the world economy in an interview with BBC Radio.
“I believe we’re sort of heading for an end of days, economically speaking,” he said.
Mr. Clarkson didn’t have facts ‘n figures to back up his assertions except to suggest that he was in the know from having spoken with several (mysterious) bankers. One wonders if these were the same financiers who scolded the Top Gear presenter for publishing his Barclay’s account details in his Sunday Times column.
Adding some premium unleaded to the market’s inferno, Mr. Clarkson acknowledged that more than 850,000 Britons held gainful employment in the auto industry – and that Ford and GM were components “too big to fail.”
But let them, said he.
Channeling Mrs. Thatcher and doubtless remembering that socialism didn’t work for British Leyland when “Communists” made Jaguars, Sir Jeremy shrugged that Detroit shouldn’t get a bail out.
“I don’t believe that governments can endlessly bail out, because where does it end?”
Who’s talking about endless? It’s ok to keep funding hundreds of billions to banks that aren’t releasing Federal capital to credit markets but not when MoTown wants $34 Billion to get them through next year?
While he was at it, he called Chrysler, the third largest American car company employing 129,000 workers, “Two bit.”
Thanks, Mr. Clarkson. I guess we can say from his casual matter-of-fact manner that this Jeremy is NOT for turning.
Until the economy rebounds, that is.
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Watch Clarkson’s interview excerpt by tapping the link.
Five Links To Give You Better Perspective On The Great Detroit Pile Up
Foggy Times.
By Gunnar Heinrich
CLEAR perspective on Motown’s troubles is hard come by these days.
With that said, here are five articles that may help.
1. BBC: “Triple Whammy Hits US Carmakers” Leave it to the BBC to give us the big picture by highlighting a complex story’s simple foundations. World Service reporter Theo Leggett points to the three biggest problems facing Motown’s Big Three today: the economic slowdown, health care + legacy costs, and strategic mistakes, plus a bit of bad luck. Okay, that really makes four or five.
2. NYT: “Echoes of 1979 In The Detroit Bailout Debate” The Gray Lady remembers an eerily similar time back when Jimmy Carter was in the White House. Then Chrysler CEO Lee “safety doesn’t sell” Iacocca flew by private jet to Washington looking to borrow $1.5 Billion ($4.2 Billion in today’s greenbacks). Chrysler received the money in a loan agreement that ended up benefiting Uncle Sam, “The gamble seemed to pay off for the government. Chrysler settled its debt by 1983, years ahead of schedule, and the Treasury made a profit of more than $300 million on the loans.”
3. Globe & Mail: “Chrysler Canada Seeks $1-Billion [Loonies].” In the spirit of globalization, reps from Chrysler’s Canadian subsidiary are reported to be the first of Detroit’s Big Three to trek up Ottawa’s frosty Parliament Hill seeking a (Canadian) Federal loan. While Ottawa’s politicos are mulling the request over a Molson or two, they’re coming back with many of the same questions that are being asked in Washington – like how a Billion Loonies will help Chrysler recover when the company lost US$3 Billion (CAD$3.8 Billion) last quarter.
4. NPR: Retirees Watching Anxiously: Will GM Be Saved? NPR’s Dustin Dwyer goes for the microcosm approach and talks to Dave Anderson, one of the General’s former footsoldiers who’s worried about the future of his (sweet) pension in the hands of an obstreperous Congress. As a UAW carpenter, Mr. Anderson was paid more than $100,000 a year for at least seven of his 31 years constructing (and deconstructing) GM offices. But - sigh - that was then. Mr. Anderson’s severance this summer was $62,000 plus health benefits.
5. Asahi Shimbun: “Toyota Profits Plunge 74%” In a brisk reminder that the automotive market’s ills aren’t just Detroit’s to bare (or bear) alone, an archived article from November 7th in Japan’s leading paper kept it short ‘n sweet. “Toyota Motor Corp. said Thursday it expects a 73.6-percent drop year on year in group operating profits through March, citing the soaring yen and falling overseas sales. The full-year projection was downgraded to 600 billion yen, the lowest since Toyota adopted U.S. accounting standards in fiscal 1998.”
Pondering The Future of Conspicuous Vehicular Consumption Under An Obama Administration
By Gunnar Heinrich
BARRING the discovery of intelligent life on Mars, the top story in today’s news cycle is almost impossible to eclipse or ignore: Barack Obama is America’s president-elect.
While Mr. Obama’s fleet ascendancy to the top of American governance is unprecedented, it still doesn’t change the rotten state that the automotive “Denmark” now finds itself…for now.
Just how might an Obama Administration change the industry and specifically the luxury car market, in particular? It probably won’t in the near term, but over time there may well be a shift away from super-luxury automobiles.
Farewell, fair Maybach.
More important than cost (what’s $300K to heavy hitters with net worths heavier than $20ma?) is the fundamental aspect of appearance.
If we were to bite onto conservatives’ concern that an Obama Administration will play the game of Federal Robin Hood, then splurging on Phantoms, Gallardos, and Panameras would definitely be out, indefinitely by the large majority of the few haves and even fewer have mores.
It’s one thing to own a lot that’s taxable. It’s quite another to look the part, too.
And considering that the soon-to-be U.S. president caved to the needs of appearance by giving up his own toy – the Secret Service approved Chrysler 300C (no) thanks to political eco-pressure – how sympathetic will an Obama Administration be to elite buyers and their elite car brands?
Not very.
Real change is coming to the luxury automotive market, to be sure.
[Linked: Reuters]
