Headlines
Anyone taking odds on the auto industry bail-out?
- Thread starter DollaBill
- Start date
Expensive Date
New member
jayboat
Banned
He doesn't really wanna run with her. He wants to teach her some new political 'positions'. :drool5:
Everyone is hurting these days. While this was my best year ever, next year is shaping up to possibly be my worste! Were is my money? I feel lucky that I am carrying almost no debt in my business and can move around and be creative with myself untill things geto going again. I see one bailout after another and all I see is more and more money that is going to be needed from me to pay for people that thought that things were going to always be roses. People that milked these companies for all they are worth (yes the execs. as well) and now just can not seem to understand why they are in the position that they are in. Anyone called up Ford customer care (or should I say careless) lately? It is a JOKE. Cars that rust, brake rotors that warp, dealerships that look like they have not been updated for the last 50 years..... They just don't get it. A couple million/billion/trillion is not going to solve the cluster fu ck mess that they have put themselves into.
Ratickle
Founding Member / Super Moderator
I do think Ford is in a position where the family could buy it back and reorganize without the headaches through a Chapter 11.
Ratickle
Founding Member / Super Moderator
They are already offering better deals than that, and they are still not selling enough cars to survive. I believe combined, last year they sold 13.5 million vehicles.
itilldo
Charter Member
Dana plant down the road from us told their salaried folks Monday that they are cutting 15 % out of the front office and also informed them that the plant might be closing.... 200-300 people
Johnson Controls in Cadiz, Ky 22 miles form here is closing in the next month 500-600 people out of work.
itilldo
Charter Member
I was sent this email tonight and I checked most of this info and it seems to be true about the closures how things are really going to go down hill and how this effects a lot more than it looks in paper:
I wanted to give everyone a heads up that if you tend to give gift cards around the Holidays, you need to be careful that the cards will be honored after the holidays.
Stores that are planning to close after Christmas are still selling the cards through the holidays even though the cards will be worthless January 1.
There is no law preventing them from doing this. On the contrary, it is referred to as (Bankruptcy Planning). Below is a partial list of stores that you need to be cautious about.
Circuit City (filed Chapter 11)
Ann Taylor- 117 stores nationwide closing
Lane Bryant, Fashion Bug ,and Catherine's to close 150 stores nationwide
Eddie Bauer to close stores 27 stores and more after January
Cache will close all stores
Talbots closing down specialty stores
J. Jill closing all stores (owned by Talbots)
Pacific Sun wear (also owned by Talbots)
GAP closing 85 stores
Footlocker closing 140 stores mo re to close after January
Wickes Furniture closing down
Levitz closing down remaining stores
Bombay closing remaining stores
Zale's closing down 82 stores and 105 after January
Whitehall closing all stores
Piercing Pagoda closing all stores
Disney closing 98 stores and will close more after January.
Home Depot closing 15 stores 1 in NJ ( New Brunswick )
Macys to close 9 stores after January
Linens and Things closing all stores
Movie Galley Closing all stores
Pep Boys Closing 33 stores
Sprint/Nextel closing 133 stores
JC Penney closing a number of stores after January
Ethan Allen closing down 12 stores.
Wilson Leather closing down all stores
Sharper Image closing down all stores
K B Toys closing 356 stores
Loews to close down some stores
Dillard's to close some stores
I wanted to give everyone a heads up that if you tend to give gift cards around the Holidays, you need to be careful that the cards will be honored after the holidays.
Stores that are planning to close after Christmas are still selling the cards through the holidays even though the cards will be worthless January 1.
There is no law preventing them from doing this. On the contrary, it is referred to as (Bankruptcy Planning). Below is a partial list of stores that you need to be cautious about.
Circuit City (filed Chapter 11)
Ann Taylor- 117 stores nationwide closing
Lane Bryant, Fashion Bug ,and Catherine's to close 150 stores nationwide
Eddie Bauer to close stores 27 stores and more after January
Cache will close all stores
Talbots closing down specialty stores
J. Jill closing all stores (owned by Talbots)
Pacific Sun wear (also owned by Talbots)
GAP closing 85 stores
Footlocker closing 140 stores mo re to close after January
Wickes Furniture closing down
Levitz closing down remaining stores
Bombay closing remaining stores
Zale's closing down 82 stores and 105 after January
Whitehall closing all stores
Piercing Pagoda closing all stores
Disney closing 98 stores and will close more after January.
Home Depot closing 15 stores 1 in NJ ( New Brunswick )
Macys to close 9 stores after January
Linens and Things closing all stores
Movie Galley Closing all stores
Pep Boys Closing 33 stores
Sprint/Nextel closing 133 stores
JC Penney closing a number of stores after January
Ethan Allen closing down 12 stores.
Wilson Leather closing down all stores
Sharper Image closing down all stores
K B Toys closing 356 stores
Loews to close down some stores
Dillard's to close some stores
I know your're looking for answers but a 660 credit scores default at a 15% rate and that was in a good economy. That's what the country needs is more bad loans
you want good rates you better have a a 750 or better and a down payment...yea, novel idea pay your bills, have some money in the bank get a loan. See too many people are missing the big picture. Easy credit is GONE!
Expensive Date
New member
I know your're looking for answers but a 660 credit scores default at a 15% rate and that was in a good economy. That's what the country needs is more bad loans
you want good rates you better have a a 750 or better and a down payment...yea, novel idea pay your bills, have some money in the bank get a loan. See too many people are missing the big picture. Easy credit is GONE!
I had no idea that the default rate on a 660 was that high.The tool business is the original buy-here pay here deal and most of my customer base is well below 660.The reason that I do not see that high of a default rate is because I see them every week.
I totally agree that you should not even be able to get a loan with late pays,charge offs on your credit report.
Cash Bar
Charter Member
I get the idea, but 750 ?
When I had the highest score of my life(so far), earlier this year, with EVERYTHING the way it should be, I had a 718.
Now it's a tick below 700 due to creeping balances. I still highly doubt I'm a serious risk.
Ok I exagerate a bit, I really don't put much stock in credit scores I've seen people with over $100K in credit card debt with 700+ scores, I'm more concerned with the 5 C's of lending. Too bad so much went into 1 C and the remaining 4 pretty much were ignored for the last 7 years. But in all seriousness, times have changed and as you can see, things got to loose.
Minimize unsecured revolving debt, keep your debt ratio under 36%, pay on time and have some capital in reserve and you shouldn't have a problem getting a loan.
Minimize unsecured revolving debt, keep your debt ratio under 36%, pay on time and have some capital in reserve and you shouldn't have a problem getting a loan.
Tommy Gun
Charter Member
I already wrote to both my senators and my rep...no way, no how, no bailout!
Tommy Gun
Charter Member
Its all basic supply and demand; regardless of a bailout, people aren't going to buy cars in this environment. They'll drive'em longer and repair'em. Good for the parts suppliers. We don't need a new car every three years. I don't want to see anyone out of a job, it's time for the big 3 to reorganize like the rest of the companies in America.
Ratickle
Founding Member / Super Moderator
I know your're looking for answers but a 660 credit scores default at a 15% rate and that was in a good economy. That's what the country needs is more bad loans
But the government can set it up as an automatic deduction like taxes. No one would default forever, they always get theirs.
fund razor
Founding Member
Asian markets down 7%.
Gonna test that 7,997 low today.
Directly and indirectly a result of this huge concern for US auto segment.
Where is the leadership of the President-elect in this situation? So much of this is psychological, why can't he make a statement or something.... tell people to be calm and start a massive PR campaign to market US products in the world market again.
This sucks. 9/11 sucked... but at least we had leadership at that time.
So we don't bail them out... I accept it.... can somebody at least go spin this as a necessary and healthy correction or something? We need a counterpoint to the henny penny side of the story.
Gonna test that 7,997 low today.
Directly and indirectly a result of this huge concern for US auto segment.
Where is the leadership of the President-elect in this situation? So much of this is psychological, why can't he make a statement or something.... tell people to be calm and start a massive PR campaign to market US products in the world market again.
This sucks. 9/11 sucked... but at least we had leadership at that time.
So we don't bail them out... I accept it.... can somebody at least go spin this as a necessary and healthy correction or something? We need a counterpoint to the henny penny side of the story.
Offshoredrillin
New member
and there ya have it, they have to do a restructure, by doing so, hopefully they will streamline...didnt look good for the big 3 all leaving in seperate private jets yesterday at a cost of 20k each. I just tell customers my film will keep their car looking better longer, as looks like they are going to keep it longer..they say ok, lets do it.
jayboat
Banned
Well, the key word there is 'President-elect'...
he's not even in office yet.
If you are really interested in listening to what he has to say, here's his first weekly address from five days ago.
Maybe our current pretzlenit could make a statement and make us all glad that we won't have to listen to him make statements for much longer. :smash:
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Alright, a little embellishment maybe...but here are some facts.
Let's take a particular Ford truck plant. A typical UAW worker gets 48 minutes per shift in bathroom breaks, a 45-minute lunch and 2 30 minute breaks. Doing the math, that looks like hmmm: That's about 41 minutes per hour. And after adding in this typical UAW worker's salary, health care, pension, other miscellaneous benefits, he's costing Ford 79 bucks an hour. Cold hard facts. Google it.
Also of note, it's costs about $2000 per big-3 vehicle to pay for all this legacy crap...that's where the competitive advantage is lost.
Let's take a particular Ford truck plant. A typical UAW worker gets 48 minutes per shift in bathroom breaks, a 45-minute lunch and 2 30 minute breaks. Doing the math, that looks like hmmm: That's about 41 minutes per hour. And after adding in this typical UAW worker's salary, health care, pension, other miscellaneous benefits, he's costing Ford 79 bucks an hour. Cold hard facts. Google it.
Also of note, it's costs about $2000 per big-3 vehicle to pay for all this legacy crap...that's where the competitive advantage is lost.
Poignant Op/Ed from today:
-------------
Let Detroit Go Bankrupt
By MITT ROMNEY
Published: November 18, 2008
Boston
IF General Motors, Ford and Chrysler get the bailout that their chief executives asked for yesterday, you can kiss the American automotive industry goodbye. It won’t go overnight, but its demise will be virtually guaranteed.
Without that bailout, Detroit will need to drastically restructure itself. With it, the automakers will stay the course — the suicidal course of declining market shares, insurmountable labor and retiree burdens, technology atrophy, product inferiority and never-ending job losses. Detroit needs a turnaround, not a check.
I love cars, American cars. I was born in Detroit, the son of an auto chief executive. In 1954, my dad, George Romney, was tapped to run American Motors when its president suddenly died. The company itself was on life support — banks were threatening to deal it a death blow. The stock collapsed. I watched Dad work to turn the company around — and years later at business school, they were still talking about it. From the lessons of that turnaround, and from my own experiences, I have several prescriptions for Detroit’s automakers.
First, their huge disadvantage in costs relative to foreign brands must be eliminated. That means new labor agreements to align pay and benefits to match those of workers at competitors like BMW, Honda, Nissan and Toyota. Furthermore, retiree benefits must be reduced so that the total burden per auto for domestic makers is not higher than that of foreign producers.
That extra burden is estimated to be more than $2,000 per car. Think what that means: Ford, for example, needs to cut $2,000 worth of features and quality out of its Taurus to compete with Toyota’s Avalon. Of course the Avalon feels like a better product — it has $2,000 more put into it. Considering this disadvantage, Detroit has done a remarkable job of designing and engineering its cars. But if this cost penalty persists, any bailout will only delay the inevitable.
Second, management as is must go. New faces should be recruited from unrelated industries — from companies widely respected for excellence in marketing, innovation, creativity and labor relations.
The new management must work with labor leaders to see that the enmity between labor and management comes to an end. This division is a holdover from the early years of the last century, when unions brought workers job security and better wages and benefits. But as Walter Reuther, the former head of the United Automobile Workers, said to my father, “Getting more and more pay for less and less work is a dead-end street.”
You don’t have to look far for industries with unions that went down that road. Companies in the 21st century cannot perpetuate the destructive labor relations of the 20th. This will mean a new direction for the U.A.W., profit sharing or stock grants to all employees and a change in Big Three management culture.
The need for collaboration will mean accepting sanity in salaries and perks. At American Motors, my dad cut his pay and that of his executive team, he bought stock in the company, and he went out to factories to talk to workers directly. Get rid of the planes, the executive dining rooms — all the symbols that breed resentment among the hundreds of thousands who will also be sacrificing to keep the companies afloat.
Investments must be made for the future. No more focus on quarterly earnings or the kind of short-term stock appreciation that means quick riches for executives with options. Manage with an eye on cash flow, balance sheets and long-term appreciation. Invest in truly competitive products and innovative technologies — especially fuel-saving designs — that may not arrive for years. Starving research and development is like eating the seed corn.
Just as important to the future of American carmakers is the sales force. When sales are down, you don’t want to lose the only people who can get them to grow. So don’t fire the best dealers, and don’t crush them with new financial or performance demands they can’t meet.
It is not wrong to ask for government help, but the automakers should come up with a win-win proposition. I believe the federal government should invest substantially more in basic research — on new energy sources, fuel-economy technology, materials science and the like — that will ultimately benefit the automotive industry, along with many others. I believe Washington should raise energy research spending to $20 billion a year, from the $4 billion that is spent today. The research could be done at universities, at research labs and even through public-private collaboration. The federal government should also rectify the imbedded tax penalties that favor foreign carmakers.
But don’t ask Washington to give shareholders and bondholders a free pass — they bet on management and they lost.
The American auto industry is vital to our national interest as an employer and as a hub for manufacturing. A managed bankruptcy may be the only path to the fundamental restructuring the industry needs. It would permit the companies to shed excess labor, pension and real estate costs. The federal government should provide guarantees for post-bankruptcy financing and assure car buyers that their warranties are not at risk.
In a managed bankruptcy, the federal government would propel newly competitive and viable automakers, rather than seal their fate with a bailout check.
-------------
Let Detroit Go Bankrupt
By MITT ROMNEY
Published: November 18, 2008
Boston
IF General Motors, Ford and Chrysler get the bailout that their chief executives asked for yesterday, you can kiss the American automotive industry goodbye. It won’t go overnight, but its demise will be virtually guaranteed.
Without that bailout, Detroit will need to drastically restructure itself. With it, the automakers will stay the course — the suicidal course of declining market shares, insurmountable labor and retiree burdens, technology atrophy, product inferiority and never-ending job losses. Detroit needs a turnaround, not a check.
I love cars, American cars. I was born in Detroit, the son of an auto chief executive. In 1954, my dad, George Romney, was tapped to run American Motors when its president suddenly died. The company itself was on life support — banks were threatening to deal it a death blow. The stock collapsed. I watched Dad work to turn the company around — and years later at business school, they were still talking about it. From the lessons of that turnaround, and from my own experiences, I have several prescriptions for Detroit’s automakers.
First, their huge disadvantage in costs relative to foreign brands must be eliminated. That means new labor agreements to align pay and benefits to match those of workers at competitors like BMW, Honda, Nissan and Toyota. Furthermore, retiree benefits must be reduced so that the total burden per auto for domestic makers is not higher than that of foreign producers.
That extra burden is estimated to be more than $2,000 per car. Think what that means: Ford, for example, needs to cut $2,000 worth of features and quality out of its Taurus to compete with Toyota’s Avalon. Of course the Avalon feels like a better product — it has $2,000 more put into it. Considering this disadvantage, Detroit has done a remarkable job of designing and engineering its cars. But if this cost penalty persists, any bailout will only delay the inevitable.
Second, management as is must go. New faces should be recruited from unrelated industries — from companies widely respected for excellence in marketing, innovation, creativity and labor relations.
The new management must work with labor leaders to see that the enmity between labor and management comes to an end. This division is a holdover from the early years of the last century, when unions brought workers job security and better wages and benefits. But as Walter Reuther, the former head of the United Automobile Workers, said to my father, “Getting more and more pay for less and less work is a dead-end street.”
You don’t have to look far for industries with unions that went down that road. Companies in the 21st century cannot perpetuate the destructive labor relations of the 20th. This will mean a new direction for the U.A.W., profit sharing or stock grants to all employees and a change in Big Three management culture.
The need for collaboration will mean accepting sanity in salaries and perks. At American Motors, my dad cut his pay and that of his executive team, he bought stock in the company, and he went out to factories to talk to workers directly. Get rid of the planes, the executive dining rooms — all the symbols that breed resentment among the hundreds of thousands who will also be sacrificing to keep the companies afloat.
Investments must be made for the future. No more focus on quarterly earnings or the kind of short-term stock appreciation that means quick riches for executives with options. Manage with an eye on cash flow, balance sheets and long-term appreciation. Invest in truly competitive products and innovative technologies — especially fuel-saving designs — that may not arrive for years. Starving research and development is like eating the seed corn.
Just as important to the future of American carmakers is the sales force. When sales are down, you don’t want to lose the only people who can get them to grow. So don’t fire the best dealers, and don’t crush them with new financial or performance demands they can’t meet.
It is not wrong to ask for government help, but the automakers should come up with a win-win proposition. I believe the federal government should invest substantially more in basic research — on new energy sources, fuel-economy technology, materials science and the like — that will ultimately benefit the automotive industry, along with many others. I believe Washington should raise energy research spending to $20 billion a year, from the $4 billion that is spent today. The research could be done at universities, at research labs and even through public-private collaboration. The federal government should also rectify the imbedded tax penalties that favor foreign carmakers.
But don’t ask Washington to give shareholders and bondholders a free pass — they bet on management and they lost.
The American auto industry is vital to our national interest as an employer and as a hub for manufacturing. A managed bankruptcy may be the only path to the fundamental restructuring the industry needs. It would permit the companies to shed excess labor, pension and real estate costs. The federal government should provide guarantees for post-bankruptcy financing and assure car buyers that their warranties are not at risk.
In a managed bankruptcy, the federal government would propel newly competitive and viable automakers, rather than seal their fate with a bailout check.
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