And if it's not just Detroit then it can't really be the fault of the UAW now can it?
Europe's motor industry is in a panic. In boardrooms across the continent the talk is of the biggest emergency for 60 years -- or at least since the 1973 oil crisis.
As executives ask the European Union for a €40-billion bail-out to match or surpass the $25-billion sought by the American Big Three manufacturers -- General Motors, Ford and Chrysler thousands of staff are being laid off. Sales are collapsing as the recession bites, with vehicles stacking up at ports around the world.
Over Christmas and the new year, French, German, Italian, Spanish and even new Polish and Czech car plants will remain shut for an extended holiday that could last up to a month.
And while Republican Sen. Bob Corker touts Volkswagen as a model for Detroit, according to Bloomberg Volkwagen is first in line:
Dec. 9 (Bloomberg) -- Volkswagen Financial Services AG, a unit of Volkswagen AG that helps customers finance cars, has applied for government aid under Germany’s bank bailout program.
Volkswagen Financial Services and Volkswagen Bank, a subsidiary, submitted requests for loan guarantees through Soffin, the government-inspired Financial Market Stabilization Fund, spokesman Dietmar Kupisch said in a telephone interview from the division’s Braunschweig, Germany headquarters today.
“The move should support Volkswagen’s financial strength,” said Oliver Caspari, an analyst at Bankhaus Lampe in Dusseldorf, Germany, who recommends selling the carmaker’s stock. “I wouldn’t rule out that Daimler and BMW follow.”
Maybe it's time to rethink those concessions.
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Of course it's not the auto industry
It's all the gamblers in the financial markets that have suddenly started not trusting each other, freezing everything up.
The gamblers need to be cut out, like gangrene. Then disinfectant (prosecute the gamblers and take away their profits) should be applied, and the financial market should be immunized (regulations that keep the gamblers out that are enforced).
(Oooh, looove the HTML options!)
"A little knowledge is a dangerous thing. So is a lot." - Albert Einstein
World-wide Auto Industry Hurting
This stuff has been talked about for weeks, but the American media conveniently leaves it out. The domestic auto industries from Spain to Sweden are in some pretty serious trouble. GM can do much better than what they've been doing, no doubt and no argument from me on that point. But the narrative that they are directly responsible for coming to the point of facing insolvency, though popular, just isn't true. What lead directly to their crisis was Wall Street's credit freeze-up, which hasn't just effected our domestic auto industry, but industries all around the world.
The difference, here, and what I won't apologize for is that one could easily make the argument that if your company isn't healthy enough that it can't ride out a recession (even a really bad one), than you don't deserve to exist. I actually don't find that argument all that offensive. I get angry when they start bad-mouthing the workers. That's a no-go.
Anyway, check out these headlines over the past month or so:
Swedish Auto Industry Future in Jeopardy
German auto industry predicts grim 2009
BMW sales plunge, Honda quits Formula One
Sarkozy gives EUR 1.5bn boost to French car industry
Toyota Sees World Sales Drop Second Straight Year, Nikkei Says
Nissan sales plummet by 33 percent (US sales)
Etc...
But, we've always been at war with Eastasia...
You can't ride out a recession
...when credit is frozen. We don't have the means and very few businesses do. Things are simply too expensive to keep large sums of cash to do pay-go. I suppose if it keeps up some that can will probably switch to paygo in some form -- it's how the news industry got by during the great depression.
We need to completely nationalize the banks or at least threaten them with full nationalization to get them to play ball and stop hoarding.
PB 2.0 - Supplement the wonk!
Exactly, Jen.
I'm mad that General Motors let itself go to the point that it has, but even more angry that they had no other choice but to ask an unconventional source (Congress) for a loan for more reasons than one. I can understand the banking industry's reluctance to give them loans, as they probably don't feel that they'll get the money back quickly, but they should be able to see the other option (insolvency) is much worse for both their business and the country in the long run.
You know, I'm sitting here looking at Republic workers in Chicago who are simply asking for what is legally and rightfully their's and the reaction by BofA, and that brings everything into perspective. A more benevolent management and banking industry would have not let that situation get to this point, and the 2008 sit-in just kind of encapsulates everything that is wrong with our feudal banking system. I simply can't muster the same time of outrage at the Big Three that I can at the openly fraudulent and criminal banking system.
But, we've always been at war with Eastasia...