Car Troubles

Monday, March 30, 2009

David Welch, Detroit bureau chief for Business Week, discusses the future of GM and the upcoming announcement about the Obama administration's plan to rescue automakers.


David Welch

Comments [16]

Shahin Khalisdar from NYC

It is beyond my understanding. Why these companies are not doing bankruptcy? Why they are seeking taxpayers assistance? Do the bankruptcy and restructure the company again thats all.

Apr. 01 2009 07:04 PM
hjs from 11211

it's the oil industry we are supporting not the auto

Mar. 30 2009 04:10 PM
Bruce Foster from NYC

While others were seeking to drive down the wave of revulsion that greeted the information about AIG bonuses, categorising it as merely "populism" and thus suspect by the ranks of privileged and the reportorial class, who seemed to have never thought once that the "rage" was merely the appropriate response to any situation where anger was never listened to in the first place, where depression had been passed over and passed through already, and where "bonuses" were somehow more privileged than "wages" or "salaries," and at a point when job security as a concept was seemingly slipping well-past its nadir, let's start persistantly asking (as I did when the Big Three first came to Washington on their mission for money) why it is that union contracts are never regarded as untouchable, but bonuses earned at the expense of the corporation are? All to the chorus of "So sue me!"

And while we are at it, why is it not an appropriate response to ask our national legislators to take a pay cut? After all, we would seem to have a prima faciae case for them having been asleep at the wheel, right? Let's start acting like we are all in this together, eh?

Mar. 30 2009 12:20 PM
Jon P. from Hewitt, NJ

1976 congress allowed pickup trucks to have a much lower MPG then passenger cars and much lower safety standards then passenger cars. The reason at the time was to help farmers who were really struggling and who were the majority of pickup truck owners at the time. Now, SUV’s, pickups, mini vans and Crossover SUV’s are all classified as trucks and have lower MPG and inferior safety standards as trucks dating back to 1976. They are also significantly cheaper to make then passenger cars. Hence the big profit margins to build and sell these things. You don’t have to make anything illegal to get rid of trucks being used as passenger cars. All you have to do is bring truck MPG and safety standards equal to passenger cars. Over night car companies would be dropping their SUV lines. You could also give a big tax break for those who legitimately need a tuck for their business.

Mar. 30 2009 11:46 AM
Jon Markey from Greensboro, NC

I am an avid motorcycle. The state of the auto industry seems to parrallel the state of Harley-Davidson in the late 70's and early 80's. They need to provide the public with a product which they want and promote the fact that they are doing so. A turn around is possible, but it will take some time and a drastic new approach to the way they do business.

Mar. 30 2009 11:45 AM
isa kocher from istanbul

your caller says get government out of business. no. get business out of government. it's finance, the AIGs and Bank of Americas whove rewritten the rules, it's GMC and big pharmacy and the insurance companies whose transportation, energy, health, finance deregulation, disregulation, misregulation, misfeasance, malfeasance, abrogation of fiduciary responsibility, and overwhelming dowry cost of getting into bed with international oil which has bankrupted us, and the GMC and Chrysler's traditional dependency on government has bankrupted them.

get business out of government and government back in government.

Mar. 30 2009 11:43 AM
Terri from Brooklyn

re: making good cars.

Both my parents and my sister bought Chevy Impalas---which are beautiful cars. My brother-in-law has always only purchased Chevy trucks, and as far as I know, has always been happy with them.

I am quite happy not to own a car anymore, but I'm also quite happy, when I visit my parents, to drive their Impala. Niiiice ride.

Mar. 30 2009 11:38 AM
the truth from Atlanta/New York

"Blackmail" caller? The government didn't just jump into their business GM asked for a bailout from the government. President Obama is allowed to say NO! Get over it.

Mar. 30 2009 11:34 AM
hjs from 11211

want to help auto communities pay people to move out, tear down their old homes, get them to move where jobs are, offer them college.

Mar. 30 2009 11:27 AM
the truth from Atlanta/New York

I have to pull my own weight to keep a business going, no bailout option, so should they!

Mar. 30 2009 11:26 AM


Tax or no tax, SUVs and Hummers should never have been legal.

We need regulation in the auto industry to prevent such waste, just as we need regulation in banking to prevent excessive credit default swaps and predatory lending.

Mar. 30 2009 11:26 AM
Mike from Manhattan from NYC

Universal health care, as Darius mentions, would help even the playing field for US manufacturers, but it is not enough. The US must increase taxes on gasoline to keep the pump price high enough so that US car buyer do not demand fuel inefficient monstrosities like the SUV or Hummer. Like European countries, Japan and other developed countries do.

SUVs and Hummers were not forced upon an unwilling public. They were demanded by people as a passenger version of the highly popular light trucks while the oil prices were unsustainably low in the late 80s, and 90s. Even this year, after the cost of gas declined, the sales of the Prius have declined more than auto sales in general.

It takes several years to bring car with major redesign to market. The cost of fuel is a major factor in what kind of car the US public will buy. So the cost of fuel must be stabilized and the only way to do that by taxing fuel at the same levels as the European countries.

Mar. 30 2009 11:21 AM

Hmmm, this is a serious problem. I think the best solution would be to legalize pot.

Mar. 30 2009 11:08 AM
KC from NYC

Brian: Regarding the relative "non-negotiability" of AIG contracts vs. UAW contracts: excellent point. I've hardly seen anyone bring that up.

Mar. 30 2009 11:02 AM
Robert from NYC

Excellent point!

Mar. 30 2009 10:58 AM
Darius from Prospect Heights

Universal healthcare would save the car companies.

Mar. 30 2009 10:56 AM

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