The last gas price surge didn't hurt them at all. This one isn't likely to either.
Are you kidding? They were practically giving trucks away last time...huge cash incentives and 0% financing and they still had a 120 day supply on the lot. They were idling plants they had so many on the dealers lots...
Government motors has not & will never payback the bailout…You are all a bunch of sheep!
While automakers are all posting strong results, taxpayers are still on the hook for billions of dollars. Taxpayers fell $1.3 billion short on the Chrysler bailout and are still waiting for $25.5 billion back on the GM deal. In total, the companies received about $60 billion between them.
And, particularly in the case of GM, it seems unlikely the taxpayer will be made whole anytime soon. Treasury holds 500 million shares of GM stock, those represent about one third of the company and if sold at today's prices, they would be worth about $13 billion.
The stock would need to roughly double in price for taxpayers to break even. Analysts predict a much more modest rise in the stock price in 2012.
http://www.local10.com/news/money/St...z/-/index.html
They seemed to come out of it just fine. Not sure what your getting at.
http://articles.latimes.com/2011/mar...sales-20110302
"Trucks also were big sellers in February based on "a resurgence in the economy and the replacement of vehicles.... People are buying for need, either to add to their fleet as their business is growing or because their truck is worn out and they need that type of capability for business," said Don Johnson, GM's U.S. sales chief.
That's created a bifurcated market in which truck sales will remain strong in the face of rising fuel prices, while small-car and small-SUV sales will continue to climb, said Jesse Toprak, an analyst at TrueCar.com
I'm saying that the last time oil hit $140 a barrel it drove the casual truck/SUV buyers out of the market and sales dropped 30%. With truck/SUV profits being such a big part of GM's profit it kills them when those sales drop off.
Remember, Oil hit $140 in June 2008 and GM started losing money like crazy and had to be bailed out in the fall. I'm not at all claiming that was the only reason they needed to be bailed out but it was definitely a contributing factor.
I'm saying that in big truck/SUV's Ford will be better positioned this time because across the board they currently can get better gas mileage than comparable GM models.
Florida Drivers S ing Out Nearly $6 A Gallon At Some Gas Stations
By Matthew L. Higgins
February 22, 2012 11:47 AM
AAA, cars, drivers, Florida, gas prices, gas stations, Iran, Strait of Hormuz
TAMPA (CBS Tampa) — Talk about pain at the pump! Some Florida drivers are spending nearly $6 a gallon to fill up their gas tanks.
According to GasBuddy.com, motorists are s ing out $5.89 for a gallon of regular gas at a S station in Lake Buena Vista, topping out at $5.99 a gallon for premium. It doesn’t get better at a Suncoast Energy station in Orlando, where drivers are paying $5.79 for a gallon of regular.
“Prices over in the Disney World area are much higher than any other place in Florida,” Jessica Brady, AAA spokeswoman, told CBS Tampa, adding that people regularly complain about gas prices in that area.
The Sunshine State is opening up its wallet, paying an average of $3.67 a gallon of unleaded gas, 12 cents more than the national average. And it’s only expected to go up.
“It doesn’t look like we will have relief at the pump anytime soon,” Brady told CBS Tampa. “I do think we will see prices surpass $4 a gallon. I think we will see that closer to spring time.”
One reason for the high prices is the conflict with Iran over the Strait of Hormuz. Iran has threatened to disrupt oil shipments through the waterway due to the European Union sanctions leveled against the country over its nuclear program, causing the price of crude to skyrocket. Trading on a barrel of crude today is a little over $106.
Another reason for the high gas prices: positive economic news. The drop in the unemployment rate and improved housing market numbers have caused gas and oil prices to rise.
“I know it frustrates quite a few consumers why positive news will lead to higher prices,” Brady told CBS Tampa. “It really just comes down to speculation.”
A third culprit behind the gas price boom is Greece. The EU’s bailout for the indebted country only adds to the global fuel demand.
And because of these reasons, Brady believes that Florida and the rest of the U.S. could see historical gas prices.
“I think this year we will see much higher highs.”
That's Chrysler + GM.
strict adherence to the confines of the thread le apparently trumps the true cost to the US taxpayer for bailing out two of the big three auto companies.
You are completely ignoring their suppliers who number at least 10x (my guess is 50x) that amount.
GM may be the largest automotive manufacturer in the world, but they arent the largest employer. Their suppliers, combined, are however.
Intresting bit. One has to note how close to Japan China is in the author's calculations as to how much high oil prices impact economies.
Given that the period the guy looked at included no small amount of time where China was a net oil exporter, one has to wonder what future results would have for the world economy on the world's soon-to-be-biggest economy, China, who is now importing more oil than Japan.
I also didn't see India at all in his data.
That was an interesting start, but seems like the idea and concept needs to be fleshed out.
Everyone focuses on GM or on Chrysler.
Those companies failing in a vacuum is a loss but not terrible.
Problem is, the world isnt a vacuum. GM, Chrysler and Ford farmed out a lot of their operations a long time ago to other private corporations. ThyssenKrupp, ACH, BorgWarner, MagnaSteer, American Axle, Tenneco...I could go on and on and on and on and on....
Admit things you dont know. The automotive industry represents MILLIONS of American jobs. The US government was smart to do what it did. The UAW is the first beneficiary of the bailout, but not the largest. The suppliers are extremely grateful as are their millions of employees.
Big picture, guys.
...and thats all I got to say about that.
I agree.
Given the size of our other problems ing about this seems trite.
Meh, the right wing in this country never lets facts or perspective get in the way of a good narrative. As long as it feeds the Conservative Outrage Machine, it will get play.
My only question/rebuttal to that is if the industry is going to sell say...13 million units a year overall between all the brands and they are for the most part going to be produced in the US and buy components from those same subcontractors does it really matter if it is Ford or Chevy building and selling the cars?
You are assuming domestic auto sales are the exclusive provience of the domestic auto makers?
Of course not. But as the Toyota plant here in SA proves they can be a foreign "brand" and still be built in the USA using some of the same suppliers.
The way they utilize their suppliers or, for lack of a better term, "train" them is fairly unique in the auto arena. I doubt seriously a supplier building starters for Toyota will ccompletely overhaul their processes to accomodate Chrysler...at least under the credit conditions at the time of the GM debacle.
But this assumes that the vacuum of cars would immediately be replaced with said foreign en ies.
Which I dont believe would be the case.
Moreover, Toyota/Honda/Whomever typically deal with foreign suppliers for damn near the whole vehicle. Toyota deals primarily with a company called NHK, for example, a Japanese company that owns a formerly-American supplier called New Mather Metals. Used to have two plants, one in Toledo, OH and another in Franklin, KY.
Toledo plant had 6 lines operating 3 shifts, which means that plant could produce its component for ~12 different vehicles through prototype, production and service.
Toledo was closed the moment Franklin was built and expanded because KY is a right to work state, so no union to deal with (unlike OH).
Franklin now has 13 lines and can service roughly ~25 models through the same life cycle, half are foreign, half are domestic in my estimation.
So lets assume that GM and Chrysler faded to black in 2008. The existing supplier base for Toyota, Honda, etc would just expand where they currently reside. Instead of 13 lines, they'd expand to say 20 and hire the needed personnel.
While multi-billion dollar suppliers like Delphi, Tenneco, TK, American Axle and the innumerable small business that supply those Tier 1 suppliers would be left with nothing and be out of business in less than a year.
A small business, for those who dont know, is any company who employs less than 150 people (I know you know that CC, just putting it out there for those who dont). To get into a relationship with Toyota/Honda takes years. To even be approved as a Tier 2 supplier to one of their suppliers takes years.
GM and Chrysler going down would have only caused great harm for many and benefited the very select few. Those select few being mostly foreign corporations who are legally allowed to own land state-side, are given land by governors to build on (literally given at no cost) while Americans are not able to do the same in their land.
We are all aware of the trade imbalance between America and everyone else. We know that foreign goods imported anywhere but the EU and America have tariffs so as not to compete with local/national companies preferred by the governments of those countries.
This bailout, imo, was necessary.
You would have allowed the manufacture of vehicles to be dominated by a foreign country at the paltry expense of $23B with the added benefit of adding roughly 2-3 million to the unemployment rolls in less than one year.
I am sorry, but to say otherwise is short-sighted, misguided and smacks of a strict adherence to creed even when reality begs to differ.
Side note: Thank God the Chinese emperor or whatever from back-in-the-day drove some pimped out Buick all around. Because the Buick brand is to the Chinese what Mercedes/BMW is to us. A status symbol of wealth and prosperity.
Bingo. Suppliers are not one size fits all and they never could be...unless one en y came to dominate the entire industry overnight. Foreign design philosophy is different in every conceivable way.
The NHK and New Mather Metals is just one very small example of how foreign companies operate. It is quite rare that the roots of Toyota/Honda do not reside in the same soil as their suppliers. If the Japanese see a business where they would have a need now or in the future, they buy it.
American companies cannot do the same thing in Japan, China or India. Its illegal.
But there I go being a protectionist again. Silly me.
DR...see page 3 of this thread.
Wow...you nailed it with a laser guided hammer. Bravo!DR...see page 3 of this thread.
I stayed out of this thread on purpose. I figured I am too close to the situation to offer an unbiased, objective opinion.
But I can tell you all in no uncertain terms, as a supplier to all major automotive companies that would not have been decimated if GM/Chrysler went under, that if they had, it would have been catastrophic.
You think you southern folks have a lot of Northern immigrants now?!
Ha. The entirety of Michigan, Ohio, Indiana, Western Pennsylvania and Wisconsin would have moved en masse right next door to you. With our stupid midwestern accents (and we think your southern drawls are just as repulsive), lack of fashion sense, flannel shirts and sardonic wit (told we speak slow compared, never noticed much).
Dont bail them out, we'll just move in next to you and marry your daughter and call it even. It'll be great!
Take that makeup off yer face and I'll let you take my daughter out.
The dowries down here are a tho.
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