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GM, Chrysler are fresh meat, yet critics chew at Obama

Posted by Clifford Atiyeh  March 31, 2009 10:46 AM

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What a day yesterday.

General Motors CEO Rick Wagoner steps down (because President Obama told him to), the White House announces a bailout cutoff for GM and Chrysler (within 60 and 30 days, respectively) and a state warranty program should both automakers fail, Chrysler CEO Bob Nardelli says a Fiat partnership is advancing (but still dependent on $6 billion more in government aid), and Proton - the Malaysian state automaker that owns Lotus - said days after the Tesla Model S launch that it will retrofit its cars with electric powertrains and sell them in the US under the pre-WWI name "Detroit Electric."

Today Ford said it would cover monthly payments of up to $700 for up to a year on all its cars should customers lose their jobs (except Volvo, which could slip into a ill-fated tangle with the Chinese). GM just followed suit by offering up to $500 per month for nine months. Incredible.

Yesterday turned GM and Chrysler into steaming slabs of fresh, raw meat that columnists and editorial boards could have savaged. But many opinion pieces in the largest metro dailies refrained, and surprisingly, placed more skepticism on the Obama administration.

William J. Holstein of the New York Times on GM's increased quality and lithium-ion push:

"Mr. Obama has not only failed to understand these contributions, he has also deprived G.M. of Mr. Wagoner’s presence on the board. Much of Mr. Wagoner’s knowledge and experience could simply be lost. With Mr. Lutz also about to retire, the two executives most responsible for G.M.’s transformation are gone."

The editorial board of the Los Angeles Times:

"But we're more comfortable letting the companies' stakeholders decide what the firms should look like in the future, rather than having the administration decide what's best for them and the car-buying public."

Eugene Robinson from the Washington Post:

"It is worth pointing out, however, that the $17.4 billion the federal government has lent GM and Chrysler since the bottom fell out of the automotive market last fall is dwarfed by the more than $1 trillion we've poured into the financial sector."

And then there's rather oversimplified arguments, such as how the Globe's Derrick Jackson compares an Escalade Hybrid to a Prius as reason for GM's failure:

"It is too late. The engines from Japan are passing 50 miles per gallon. GM still brags about a Jurassic that gets 20."

But GM's poor decisions stem far deeper than introducing a new Escalade right as full-size SUV sales plummet. Paul Ingrassia of the Wall Street Journal explains:

"There was a "can't do" mentality that accepted too many brands, too many dealers and too many workers as immutable facts of life that could only be changed slowly and gingerly, if ever. That might have worked had Americans continued buying big pickups and SUVs at a record-setting pace for another decade or two. But that prospect never was realistic, even before car sales collapsed nine months ago."

It's worth noting that Toyota still sells the Land Cruiser and Sequoia, two overweight trucks that don't even crack 20 miles per gallon on the highway. But Toyota has been smart enough to leverage other segments - namely, non-hulking cars - instead of ignoring them. So too, will GM and Chrysler.

All they need is 30 to 60 days, right?

This blog is not written or edited by or the Boston Globe.
The author is solely responsible for the content.

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83 comments so far...
  1. wait a minute... the car makers in trouble are Union shops right?? Toyota is not... are we sure we are fixing teh "right" problem?? Are we sure that having a dictator in the white house is a good thing??

    Posted by Nuffsoso March 31, 09 01:06 PM
  1. Take a look at the "new" 2010 Camaro and you can see that GM is still living in the 50's and 60's. Big, boxy, gas guzzler with a big engine...... Big is not always better, especially today.
    It's sad but, they just don't understand.......

    Posted by Al R. March 31, 09 01:27 PM
  1. If GM and Chrysler do not take this golden opportunity to take ownership of the companies back from the greedy self serving unions, they deserve to go bankrupt. Obama is giving them one last chance to break the largest socialist concept in this country outside of welfare and social security and they had better grab this chance before its too late.

    Posted by DK March 31, 09 01:28 PM
  1. It is all greed and

    Posted by xox March 31, 09 01:28 PM
  1. If GM and Chrysler do not take this golden opportunity to take ownership of the companies back from the greedy self serving unions, they deserve to go bankrupt. Obama is giving them one last chance to break the largest socialist concept in this country outside of welfare and social security and they had better grab this chance before its too late.

    Posted by DK March 31, 09 01:29 PM
  1. So, Nuffoso, the only difference between the way these companies operate is that the D3 are Unionized and the foreign competition is not? Me thinks you need to look at the system of bonuses as well as management decisions over the past 3 decades at the D3 before stating the Union is all at fault here.

    Posted by Chris March 31, 09 01:29 PM
  1. It's not dictating to say "do something different before we shell out more money". The real problem for the big 3 is the simple fact that they are out of touch with what car buyers want and they just have their hand out rather than realizing it! I recently bought a Toyota and didn't even look at comparable Ford or GM cars simply because I got a better warrranty, better mileage and a better reputation for quality. It has nothing to do with unions- it has to do with what's coming off the assembly line, and in Detroit it's the same old, same old.

    Posted by Brian R March 31, 09 01:29 PM
  1. America is finished.

    Posted by MIKEY March 31, 09 01:30 PM
  1. W ehad a real dictator for 8 years ....he's and Darth Vader are gone. What Obama has done is a wake up call. There are consequences to this case inaction for decades in the auto industry. I support the move to oust CEO's that have ignored calls for change and continue to ask US to bail them out. I agree the auto industry relys on labor from unions and tthat union labor is part of the problem. As soon as the producers stop pointing fingers at the unions and the unions stop pointing fingers at management maybe they will decide to cooperate and save themselves. It's a symbiotic relationship which now will require each to adjust ...without the kick in the bu__ from the administration nothing will change. It's about time.

    Posted by cmiller March 31, 09 01:33 PM
  1. I rather think that those quoted in the article above are quite severely mistaken. Stating that:
    "Mr. Obama has not only failed to understand these contributions, he has also deprived G.M. of Mr. Wagoner’s presence on the board. Much of Mr. Wagoner’s knowledge and experience could simply be lost. With Mr. Lutz also about to retire, the two executives most responsible for G.M.’s transformation are gone."

    fails to appreciate the fact that it was these people who caused much of the downturn in the industry and those who continue to make poor decisions. We need new people making new, better decisions.

    "But we're more comfortable letting the companies' stakeholders decide what the firms should look like in the future, rather than having the administration decide what's best for them and the car-buying public."

    Again this statement fails to recognize the fact that the stakeholders cannot and have not been deciding anything. They have been begging for billions of dollars and then squandering it worse than they squandered the money they worked hard to make. I commend Obama's courage in attempting to restore a true free market economy.

    Posted by Sarah March 31, 09 01:34 PM
  1. ah, the road to serfdom.

    Posted by Truth March 31, 09 01:37 PM
  1. The decision to ignore the need to produce more fuel efficient vehicles was a CEO decision, not a union decision. As late as 2007, Wagoner was in front of a congressional committee crying that it was impossible to meet even the most modest efficiency standards and begging for more time... more time...

    But wait a minute... Toyota has already met and handily exceeded the new requirements. Many other foreign competitors are meeting and exceeding the requirements. I think we are definitely fixing the *right* problem. When the American people own the bulk of a company's debt, the government has an obligation to steer the course of the company for the benefit of the debt holders. In the business world, "dictator" and "CEO" can be and often are, synonymous.

    Posted by Steve Rosenstein March 31, 09 01:38 PM
  1. The auto industry was incompetently managed and the apparent solution is to turn business decisions over to an even more incompetent federal government. Should this plan fail, Obama is lining up several mental hospitals where patients, some of whom are the reincarnations of Henry Ford, John D. Rockefeller and Napoleon Bonaparte, are ready to lead. Seriously, this chaos is what happens when people vote out of anger (at Bush) rather than on the basis of common sense. Obama and his flower-children are full of 1960's hogwash about peace, love, denial and utopia (where we can all earn money making solar panels and straw baskets) , and where everyone will be happy sharing the land without stress
    or turmmoil if we just trust "big brother" Obama. The problem is not just is idelogues and crooks like Reid, Pelosi, Dodd, Franks and other corrupt Democrats who have encouraged and promoted economic recession since taking control of Congress in 2006 and blocking every reform bill for the past years. Now th

    Posted by Anonymous March 31, 09 01:38 PM
  1. Posted by March 31, 09 01:39 PM

    Posted by LORIANNE March 31, 09 01:39 PM
  1. what are you talking about?

    Posted by nyphotog March 31, 09 01:41 PM
  1. DId the unions make GM and Chrysler make the wrong cars? Sorry, the companies did not have the foresight to start to develop more gas efficient cars (it has been talked about since the 70's).... not exactly the union's fault . If they made cars people wanted to buy then we would not attribute their success to the unions.

    Posted by anon March 31, 09 01:41 PM
  1. Let them fail, They are still struggling to survive after all that aid. Pull the plug, Ford has moved ahead without aid. I thought the "American Way" was make a product, sell it and make a proffit, thus survive. Chrysler, and the Generic Made Chevys are way over rated. They didnt prepare for the future, and the unions are not helping matters. But lets blame the Pres!!! Heck I didnt vote for him but even I would have buried the hatchet in the companys' collective necks long ago. You want to blame Obama for anything, blame him for letting this BS over all the bail outs continue. yes things would be tough but we would recover from thing out the weak ones. America was born from people that was willing to work hard, now there is way too many lazy, baby makers collecting welfare, ileagals, and if that isnt bad enough goverment employees (AKA congressmen) making money and not showing any results. To quote the Joker "This town needs an enima!"

    Posted by don March 31, 09 01:41 PM
  1. Dude the point of the article is that American cars flat out suck. Why should we bail out some company that puts out cars getting 20mpg as a hybrid and pay for the workers who get paid on avg 70000 to push a button?

    That CEO was part of the problem and I'm glad he's out. What a horrible direction he put GM in. Japan is just more efficient plain and simple

    Posted by psizzle March 31, 09 01:42 PM
  1. GM employs 200k people and has over a million people for whom it pays pensions, retirement benefits and healthcare. GM isn't a car company-- its a retirement home that makes cars. Thats the problem. Nuffsoso, you are right!

    Posted by BobLutz March 31, 09 01:42 PM
  1. You ain't seen nothin' yet! Fasten your seat belts. Our socialist, soon to be fascist President is in the drivers seat. The pun is intended.

    Posted by farewell America March 31, 09 01:44 PM
  1. Glad that the Globe is yet again coming to the defense of Obama (it's shocking).

    The truth is all the blame lies inside of GM both on the part of the management and of the unions who just don't get that $85/hour is simply too much for a line worker. Even with all that blame it's both scary and sad that the government is putting its hands so deep into the private sector and for that there is no one else to blame for Obama.

    The solution is simple: no bailouts for anyone (banks, companies, individual, etc).

    Posted by no March 31, 09 01:44 PM
  1. Obama is literally a slave. He is a slave to old Union thugs that destroyed these companies, and he is a slave to old Democratic Party ideology that places union thugs on a pedastal.
    Obama wants to make Soviet cars, but Americans KNOW better. Obama/Pelosi/Reid are showing their true color - RED. WE need to take the protests to the street. America is under assault from within . . .

    Posted by Larry Douglas March 31, 09 01:44 PM
  1. Gee, let's see. Foreign car makers are making cars here successfully. What's the difference between them and others? Unions!
    The big three had to rely on big cars and trucks with high retail margins to make up for the cost of unions. You couldn't possibly make a $13K car with union labor costs and make any money on it so they were forced into vehicles the public would pay a higher premium for. The American companies couldn't afford to make smaller cars because the amount of labor in each is about the same as a suv with far lower gross profit margin.
    Blame the unions and they are now going to get what they deserve!

    Posted by Bill March 31, 09 01:47 PM
  1. Nufsoso.............we just got rid of "the" dictators that are responsible for all this mess. today's scenario would be a lot worse if they were still in power.

    Posted by JRP March 31, 09 01:48 PM
  1. In the past, the auto companies have lead the market to where they want it to go. When they made full size SUVs sexy, we bought them. They can lead the market where ever they want it to go. I do agree that they are handcuffed by the unions. Pay and pentions are crippling the company. Now $97 an hour wages and full pentions and healthcare and a unwillingness to relent or accept pay and benefit cuts don't seem like a good idea in the light of a bankruptcy.

    Posted by Rodney March 31, 09 01:48 PM
  1. "Obama's courage in attempting to restore a true free market economy"
    -Sarah (March 31, 09 01:34 PM)
    Wow Sarah, you really aren't too bright, are you? A free market is a market that is free of government intervention and regulation. Obama is trying to interven and establish increased government regulation, control and oversight in places where government involvement has only caused harm in the past. The government doesn't know anything about business - all the money the government has, it gets by taking it - not by working for it. Obama has no business in the white house - he's proven that yet again.

    Posted by Frank March 31, 09 01:54 PM
  1. GM is going to have to stop talking about the Volt and get it out there ! Management needs to show some courage and the kind of attitude that made the United States the greatest manufacurer in the world at one time. The US needs to pass some shareholders rights laws. Right now shareholders have no say in executive compensation and the executives are bleeding corporations that took generations to build dry.

    Posted by jane armstrong March 31, 09 01:57 PM
  1. Does anyone think that GM and Chrysler will be here in ten years, regardless of this administration does? And if that is the case, why bother? Close them down now. It will be aterrible blow, but better to get it over with and move on.

    Posted by Guy Thompto March 31, 09 01:58 PM
  1. DK's and so-called Nufsoso's lack of understanding of the socio-economic history of the US is abysmally embarrassing. That's the real problem in the US. Ignorance! They toss around terms like "dictatorship' and "socialism" without understanding the definition of either. We don't have enough parrots in the world? We need two more? The economy may be sour, but libraries are still open. Read a book. Start with the dictionary.

    Posted by Henri Brooks March 31, 09 01:58 PM
  1. This is just the beginning, folks! If you think you support what Obama is doing here, you need to take a step back from the details and think BIG PICTURE. Government seizure of private property...Government control of what used to be private enterprise...Government deciding what products ought to be made, and how. Government won't limit itself to control the people and behaviors YOU don't like. It won't stop taking control and power when YOU think its a reasonable time to do so, and it won't stop itself from intruding on the liberties YOU hold dear. Government, once let loose in this fashion, will continue to take and exert more and more power and control in your life, and America will pass into history.

    Posted by American Capitalist March 31, 09 01:59 PM
  1. The administration's recent actions regarding GM are an alarm bell for bond holders, dealers, suppliers and unions. It means, "Renegotiate. or else."

    Posted by Agn Yupi March 31, 09 02:01 PM
  1. Wow, Larry Douiglas. What kind of "Red Scare" nutcase are you?

    Posted by CANAMERICAN March 31, 09 02:02 PM
  1. Thank you Obama! He's the most responsible president since FDR. The big 3 auto companies have been focused on quarterly profits for the at least the last 20 years. That is why they continued to build lower quality, outdated products regardless of the changing markets, made concessions to the union instead of entering into more competitive agreements. This is a huge opportunity for the big 3 to restucture and become competitive again. Obama and his team are giving them that chance and pushing them into a competitive, sutainable model. Obama is the greatest !and we (Americans) and the big 3 should be greatful.

    Posted by Art March 31, 09 02:03 PM
  1. Nuffoso still makes a great point here. It is true that the Japanese factories in the US are able to produce a vehicle cheaper, something like $3000 on average --car to car. Union benefit packages per employee are purely unrealistic. The additional cost of these benefits reflects in the operational cost of producing any product. Therefore, Unions should not be entirely exempt in the finger pointing war because they "are" part of the problem, not the idea of unionism, but the greed that they have steadily imposed on American companies over the past decades.

    Posted by Zswiss182 March 31, 09 02:07 PM
  1. Asking for $17 billion after receiving $13.4 billion a few months ago is outrageous.

    Posted by john March 31, 09 02:07 PM
  1. If they had paid their bills instead of stuffing their own pockets, they would be alive and well today.

    Posted by catsmom March 31, 09 02:07 PM
  1. It strikes me that most (all?) of these comments as well as those regards the financial & housing issues are looking backwards. The wrong way! Regardless of blame, if the US auto market is expected to support sales of 9-10m units, there's no point wasting cash or basing strategy on an industry that's geared-up to sell 15m units. Also, if the car makers receive any money , does anyone do the math to see how many ADDITIONAL units must be sold to recoup those funds? Is it feasible to pour millions, let alone billions into companies selling into shrinking markets? Is there any common sense left? Anywhere?

    Posted by Jerry O. March 31, 09 02:11 PM
  1. First, being elected does not make you competent.
    Second, please remember that both GM and Chrysler were created by financiers from bankrupt or broke companies.

    Posted by bill March 31, 09 02:12 PM
  1. Lets not forget that we've given GM, Chrysler and Ford (several years ago) a ton of money. Yes, the Obama administration forced the CEO out but obviously this company needed a change. This guy has been in charge to long and the company has suffered because of it. Things must change if they will survive.

    Also, to the comment above about the new Camaro, get your facts straight. The base Camaro gets 305 horse power and 29 MPG!! Great engine and great tech but its lost with all the other hoopla about GM.

    Posted by Gidiyup March 31, 09 02:14 PM
  1. American Capitalist: McCarthy would be proud of you. "This is just the beginning, folks! If you think you support what Obama is doing here, you need to take a step back from the details and think BIG PICTURE. Government seizure of private property...Government control of what used to be private enterprise"

    The choice President Obama's given those who have perpetually been propped up by taxpayer dollars is this: IF you need a handout to remain in business then the American People need you to step out of hiding - you overly wealthy CEOs and Board Members. You've been the Dictators holding the American Citizens for ransom all these years. Corporate Gods are still in control of America. Obama is offering a chance for those whining begging auto makers to become reponsive to what Americans want. It's too simple to just say let them fail. But it's not seeing the Big Picture to not put an ounce of requirement for responsibility behind tax supported bailouts.

    Corporate American is to blame for our economic demise. The People are not. The Few still control everything. Maybe it is time to bring out the "S" word (socialism) or at least the "D" word (Democracy) and wake up to the facts of whats needed and stand up to those who would play us with scare tactics over anything that hints at benefiting the People rather than the God-Corporations.

    I'm impressed with Obama's guts. He's the person who We elected. Quit whining and trying to undermine him and America in his efforts to right what that Criminal W. did towards our economic demise.

    Posted by CANAMERICAN March 31, 09 02:16 PM
  1. Instead of ridiculing those who sound like a "Red Scare Nutcase" we need to listen to the voices of history and experience. Throughout history there have been recessions and periods of economic uncertainty, and in every instance an opportunist has come along offering "hope and change" . In the last century, the inflation and depression of the Weimar Republic led to Adolph Hitler, who promised to protect workers, punish evil "Jewish Bankers" and reform Germany along socialist lines. People need to look at the big picture and Obama's broad-based attack upon our society. Financially the government has aggressively

    moved to nationalize the auto industry, thereby converting GM into an American "lada" (or "Yugo")> The Government ordered Banks to convert salaried employees into dollar-a-year men with a pay system consisting of one annual bonus rather than monthly or weekly paychecks, and then feigned outrage over those alleged "bonuses". The Government now claims the right to RETROACTIVELY TAX PAST INCOME. (Does the soviet elite care to look at anybody's past tax returns around here?) The Obama-nazis are aggressively moving to shut down opposition media, regulate free speech, and squelch criticism. So the government is taking over industries, it is taking over banks, it is silencing the media and there are still dumbos out there who are more worried about Bush. yep, these are the same people who will wonder how their freedom vanished as they get marched to the camps.

    Posted by markm March 31, 09 02:17 PM
  1. The union is not the problem. The problem is that GM did not save for their retiree health care and pension costs while the retirees were still working. Instead, they kicked the can down the road until the bills came due. They knew these costs were going to come, but they didn't save when they needed to. This is management's fault, 100%.

    Posted by darkcoffee March 31, 09 02:17 PM
  1. GM and Ford operate some of the most efficient, cutting-edge automobile factories in the world. Unfortunately, they are not in North America due to UAW work rules. Until these parasites are eliminated, the US automakers are going to have a hard time competing with any other companies. They also need to change their image. The caricature of the US auto industry is a slow dinosaur that only makes big clumsy low quality vehicles and some people won't even bother giving them a chance. They do make some good vehicles and a few of them get decent mileage, but they are ignored and don't get the design attention that the sports cars, SUVs, and trucks receive Of course, the 'brainiac' at Chrysler that canceled the Neon without having a replacement in the 30mpg+ category should be fired.`

    Posted by kws March 31, 09 02:19 PM
  1. Obama does not want the autos to fail. There are far too many votes there. You can do anything to a politician but when you try to take away votes -- you are going to see real blood. He simply wants to own them. GM - Government Motors.

    Posted by Old Mo March 31, 09 02:20 PM
  1. So . . .Nader was right all those many years ago - y'all should have voted for him!!
    And there is a reason that the unions are there in the first place - these companies are no real friend to the common serf.

    Posted by Grampa Caligula March 31, 09 02:20 PM
  1. There are efficiencies of size but there are also great inefficiencies. The larger the company, the more freeriders there are, all wanting to maintain the status quo. While unions protect the workers' interests, they have no incentive to innovate, work harder or become more efficient. They have a great incentive to maintain the status quo and minimize effort. The biggest company, of course, is the federal government, which has a great incentive to spend money, but none to create efficiencies. The government directing GM is ironic. And of course an inexperienced government czar thinking he knows what's best for a major company is the height of arrogance.

    Posted by Jeff Patterson March 31, 09 02:20 PM
  1. Do we have anything left to make in the U.S.? When we said the GREEN MACHINE will take us back to the stone age, we can now see the results. How do we reduce the carbon emissions from Washington.

    Posted by Herb Anderson March 31, 09 02:21 PM
  1. A 30 year share decline, never fixed is the issue. It is a remarkable failure of leadership, not shared by Toyota. In the 70's David Halberstam published The Reckoning about Detroit. No one there read it, or had the leadership qualities to re-invent the industry for the future. Those like Lutz who protest that any automaker would have gone with the market and it's big profitable trucks still don't get it. Being a leader means seeing what will be there not just what is. The drive for immediate (well, at least quarterly) short-term results in partially to blame. The mugging of Saturn by lack of faith and investment, a division that could have been GM's future, or at least pointed to it, was unforgiveable. Can we not figure out how to have a car industry of the future instead of the past?

    Posted by Gerry Miller March 31, 09 02:22 PM
  1. When will GM answer the question: "Who Killed The Electric Car?". They know the answer. Seems like cause and effect, doesn't it?

    Posted by CANAMERICAN March 31, 09 02:24 PM
  1. First, it was big brother watching you (and listening to you) under Bush, Now Big Brother is taking over your business because HE can do a better job running it.
    What's next? Big brother will tell you what you can eat and drink. (WAIT!, he is already doing that too!) Freedom as we know it will be the thing of the past.
    I thought dictatorships were ONLY in other countries!

    Obama should quit trying to run the auto makers. The banks are the reason the auto makers are in trouble. Not just the cars they build.

    Posted by Freedom -a dying privilage March 31, 09 02:25 PM
  1. Just more blind propaganda perpetuated by Obama haters who are sore losers gripping tightly to their failed idelologies. So you know how to save us, huh? Why don't you do something instead of complaining? Oh I forgot. People like you would rather see America destroyed in order to be proven right.

    Posted by jj March 31, 09 02:28 PM
  1. GM has built some great cars that rival the Pacific ring products in recent years, - -i.e. Buick LaSabre 35 mpg highway, Chevy Lumina 37 mpg highway -- city milage in the mid to high 20's. Rather than improve these models in style, electronics, gas milage, and mechanical advances, they discontinue them and build new cars with new problems to solve and end up with a product that is not of the same quality as the older models. It is as everyone has said, Detroit does not listen to its buying publinc.

    Posted by SRR March 31, 09 02:32 PM
  1. I have wanted to buy a new US made car for the last 9 years, still driving my 92 Saturn SL1 because none of the American automakers has produced anything equivalent in size, comfort and gas mileage for me to buy. Saturn was a superb and revolutionary concept but the parent company couldn't keep their paws off it, now it is nothing but an outlet for outdated European models. This has nothing to do with Unions, it is all about satisfying consumer demand and this consumer is still waiting.

    Posted by redink March 31, 09 02:38 PM
  1. "If GM and Chrysler do not take this golden opportunity to take ownership of the companies back from the greedy self serving unions, they deserve to go bankrupt. Obama is giving them one last chance to break the largest socialist concept in this country outside of welfare and social security and they had better grab this chance before its too late."

    This is the truth.

    Also, when Obama asked the current CEO to step down, he bought the chicken. Now it is up to him to make sure it lays eggs.

    I personally would have let the chicken die a long time ago.

    Posted by John March 31, 09 02:43 PM
  1. GM is perfect example of dysfunctional US corporate governance that ran successful company into the ground. Mr. Wagoner is not rather symptom than a problem. Why he was able to come on top and stay on top despite series of failures? Why board and CEO were able remain in power while failing shareholders for yrs. Why loyalty to corp is rewarded more than talent?
    We assume that Corp. are working for the best of shareholders. In fact big corps are lost in dirty deal making between CEO/Boards/Unions while 'proxy voting system' shields them from shareholders.

    Posted by SKV March 31, 09 02:43 PM
  1. The folks that are dumping on President Obama at this stage are doing so for political reasons. There may be valid reasons in the future for doing so but at the present time, the Obama administration is trying to chart a course in an unmapped swamp that was developed over years by political persons, Democrats as well as Republicans, that were taking money from lobbyists representing the cream of Capitalism and making laws and regulations that benefited the few rather than the country. We may be worse off a year from now or we may be out of the swamp and back on the road to the American Dream. One thing we know: The American auto manufacturers screwed up!!

    Posted by msgijoe March 31, 09 02:46 PM
  1. About 3 to 4 years ago, Mr. Wagoner announced the death of GM with the statement: " we are going to keep making big cars because that's what our customers want". I knew then it was over. There are a lot fewer of those customers just 3 or 4 years later, no?

    Posted by Alan F March 31, 09 02:48 PM
  1. anon - Like every other aspect, the Unions do have a say in which cars get produced. But, that is no excuse for not designing and building better cars.
    But let's look at the reality- If you already think US cars are subpar in quality and design, what would it take to change your mind? Hyundai has managed to change a lot of the negative perception about their cars by building quality cars.
    Is that even possible for GM or Chrysler? Chevy ads talk about how many cars they have with more than 30mpg, but does anyone want any of those cars?

    Posted by Bob Damon March 31, 09 02:49 PM
  1. "The problem is that GM did not save for their retiree health care and pension costs while the retirees were still working. Instead, they kicked the can down the road until the bills came due. They knew these costs were going to come, but they didn't save when they needed to."

    Sounds like they were taking notes from Social Security.

    Posted by AC March 31, 09 03:03 PM
  1. While all opinions are welcomed, it would be nice for some of them to make sense.
    1st - Big 3 are out of touch with the buying public. Not so, the buying public didn't want small cars they wanted SUVs. Only after gas went to $5 did they start gripping and car sales dropped.
    2nd - Toyota was able to build their hybrid because the Japanese gov. paid 100% of the development costs of the technology. Our companies have to go it alone.
    3rd - Seen figures showing GM saddled with between $1,600-$4,000 per-vehicle handicap for mostly retiree health and pension benefits. Not so for carmakers outside of the US.
    The real problem is Obama catering to the unions by propping up the D2 and is why there hasn't been much concessions from them.

    Posted by TonyA March 31, 09 04:14 PM
  1. Chrysler has come a long way in the past decade producing a better quality vehicles, and has dropped a few of thier models. GM will have to discard some of it's models and streamline it work force.

    Posted by Steve B March 31, 09 07:54 PM
  1. Obama looks quite at home as a car salesman - not surprising, it's about all he is good for.

    "Come one, come all to Dancing Barry's Car-orama! Barry will provide help with financing and even an extended warranty. Prices this low are INSANE."

    Get my tax money back and put these companies into bankruptcy. NOW!

    Posted by Odumba March 31, 09 08:13 PM
  1. "The real problem is Obama catering to the unions by propping up the D2 and is why there hasn't been much concessions from them."

    Right on the money. Obama's sole concern is preserving the UAW. He will spend billions and overspend any bounds on his office in order to do this.

    Posted by Odumba March 31, 09 08:20 PM
  1. Question: What do Obama, GM, and Chrysler have in common?
    Answer: They will no longer be around after the 2012 election.

    Posted by CarveMaster March 31, 09 11:02 PM
  1. When did it become wrong for someone to make a decent wage and benefits? My father was union. He raised 4 kids and sent us all through college. He wanted us to "work with our heads up and [expletive deleted, ed.] down". We didn't exactly living a life of luxury. We never lived beyond our means and often did without. There was no such thing as a healthcare copay. He retired recently with a bad back, bad knees and host of other ailments from 30+ years of physical labor. How many of your dad's jobs were union and supported and educated you so that you could later look down your noses? Unlike most of you hypocrites, unions have benefitted me and my family and I am grateful.

    I am grateful for the union teachers who educate my kids, the union police and firefighters who keep them safe, and the union nurses who cared for me in the hospital recently. Spend a physically and mentally draining day in their shoes and you may find them underpaid.

    I have only purchased 2 autos (both Jeeps) in the past 22 years. Neither left me stranded. I get 24 mpg in my Liberty and use less fuel in my 10-minute commute to work than most of my coworkers who drive Toyotas and Hondas, yet live in the Boston area over an hour away. Eight years/130k on the "new" Jeep and I have yet to replace a single part, just change the oil every 3k. I have given rides to Toyota and Honda coworkers while their cars were being repaired.

    Before you reply with some lame "back in the 70's" Detroit story and tell me about quality, tell me about someone you know who owns a 70's era Honda or Toyota. Nobody bought a foreign car until the oil crisis because they were junk. I can quickly name a half-dozen friends and family with running Dodges, Fords and Chevys from the 70's (and 60's and 50's). Funny how those American cars that don't last are still hanging around.

    Last thing, how many mpg does an auto-carrier ship use? Last I read, it was 120 GALLONS PER MILE of BUNKER FUEL (very nasty, bottom barrel stuff). Your fuel-efficient car already has a lot of fuel to account for before it even gets on the road.

    Posted by Anonymous April 1, 09 07:11 AM
  1. I love listening to you idiots on here blaming all of the Big Three's woes on Unions. It shows you for the shallow, petty, ignorant morons you are. You need to turn off Faux Noise and start educating yourselves as to what is ACTUALLY the problem. PRODUCT!

    Posted by TSRVT April 1, 09 07:36 AM
  1. There is no question, that the government should not have bailed out GM,Chrysler, AIG. These companies should have been forced to file Chapter 11 bankruptcy. Once, filed, GM and Chrysler could have reorganized and have gotten rid alot of the debt, which has piled up. In my estimation GM and Chysler will eventually have to file for bankruptcy, since they are selling to few cars. The government has spent too much of our money and cannot account where all the money has gone. Chapter 11 was instituted to protect and assist struggling companies. In the future
    we will all have to bare the burden of this huge debt.

    Posted by roger shibley April 1, 09 09:42 AM
  1. to those who blame 'capitalist greed', wake up! capitalist greed, or more technically, profits, are what have generated the highest standard of living anywhere on the planet. if you want a lower standard of living, go to any socialist country and be happy.

    to those who blame the unions, you're partially correct. but the companies signed those contracts, and so are to blame as well. the only answer is re-organization thru bankruptcy, throw out the unions, and proceed. once the unions are gone, quality will increase, and cars will start selling again. most importantly, get the govt out of the car business. they cannot run their own affairs, and few in govt have ever even run a lemonade stand. i would trust GM in the hands of 7th graders more than trusting the govt with running it.

    Posted by jake April 1, 09 10:09 AM
  1. #24 Bill. Back when the US market was dominated by US manufacturers, management and labor were all living high on the hog. Top benefits, overtime galore, and autoworkers lived the middle class American dream as among the highest paid blue collar workers in the world. WIth the rise of foreign competition, now building here, and the increased efficiency of the US manufacturers, there are a huge number of retirees that are receiving benefits out of current revenues, far more the the current number of employees. Most of us in the private sector have seen dramatic changes in retirement systems (Defined benefit to defined contribution 401K's) and increases in health care costs. But you have old agreements that are being honored. Public, educational, and unionized firms have not adjusted to changes as quickly. Let's not forget that on top of it all, the return on pension funds have dropped as the market has dropped, and now the companies need to make up the cash, and they don't have it. With the economic crisis, all of these issues are now coming to a head. GM just wasn't ready to change as dramatically as was needed, but compare them to GM of 25 years ago. There is a vast difference.

    Posted by Steve April 1, 09 10:32 AM
  1. I have never in my lifetime heard a president referred to, as Mr.

    It Does not matter whether we voted for him or not, for better or worse!, he is still the President of the United States of American and if the world sees Americans disrespecting him then they to will follow suit. Then where will we be!!!!!!

    Posted by Meme April 1, 09 10:57 AM
  1. It's amazing how many idiots have an opinions but are doing nothing of real importance in their lives except giving their opinion and harsh judgments

    Posted by Amazed April 1, 09 11:10 AM
  1. The malor contributor to GM'S failure(s) is without question,QUALITY AND RELIABILITY. For some reason the so called car experts / pundits have not highlighted this in any of the major news / media releases thus far. I speak from first hand experience and research. At the tail end of the 80,s and all of the 90's a good percentage of GM TRANSMISSIONS ESPECIALLY IN 3.8 LTR engines
    were flawed and failed due to a torque converter lockup condition among other undisclosed reasons given by GM. Many of these transmissions were in high end models such as BUICK PARK AVENUES . Both my 1992 and 1996 PARK AVENUES required transmission replacements at 76000 and 47000 miles respectively. In addition to transmission problems a chronic design failure with the intake manifold gasket assembly caused anti freeze coolant to leak into engines. A class action suit is in process at this time to cover repair cost for this condition.This suit accuses GM of not issuing a bulletin or recall on a known problem. I have personally experienced both of the problems referenced herein. When asked if I could speak to a District GM representative the GM dealer who performed these pairs said he was not allowed to do so. Through other means I did get in touch with a GM representative who said he was not aware of a major issue with transmissions or manifold gasket failures. A typical party line response I was later told by a GM parts department employee. I was made aware of how many failures/flaws exist with GM vehicles by more than one(1) GM parts/service dealer. The information on quality and reliability of vehicles is available in
    Consumer Reports , the national highway transportation and safety board(NHTSB) as well as blogs on the internet. This once proud GM owner for over 30 years has lost respect for what used to a consumer advocate in the production and sales of their vehicles. I purchased a TOYOTA AVALON in 2000 and have never had to go to a dealer for repairs except for the normal maintence etc.

    Posted by raymond digiovanni April 1, 09 11:27 AM
  1. 'Amazed', I'm amazed by how much your comment falls into the category of the very comments you are criticizing.

    Posted by jake April 1, 09 11:50 AM
  1. I have read many comments stating that Toyota and Honda have a better warranty than Chrysler... Since When?? Chrysler has a lifetime powertrain warranty on thier cars, which is the best warranty in the business.

    Posted by chris. o April 1, 09 11:54 AM
  1. To Meme, post number 71 at April 1, 09 10:57AM. You obviously weren't paying attention in 1992 then, when the Press insisted on calling President G.H.W.Bush "Mr." The reason for this, and they admitted it at the time, was so that there would not be a "bias" that might influence the upcoming election between Bush and Clinton.

    I agree that Presidents should be treated with respect, but the media has already set precedent that Obama can be called "Mr."

    Posted by Kevin April 1, 09 12:39 PM
  1. "we're more comfortable letting the companies' stakeholders decide what the firms should look like in the future, rather than having the administration decide what's best for them and the car-buying public."

    Works for me. No more government money. Go declare bankruptcy. Bye.

    Posted by JimR April 1, 09 12:55 PM
  1. this issue about warranties is ridiculous. Chrysler and GM NEED longer warranties because everyone knows their products do not last; toyota and honda don't need long warranties because their products do last.

    ask yourself: do i want a car that will likely break down but will be warrantied when it does, or a car that isn't likely to break down at all?

    Posted by jake April 1, 09 01:38 PM
  1. the issue, chris, is that Chrysler won't be around to back up that warranty. I agree that Honda & Toyota are a bit overrated these days in terms of reliability (I own German and love the European driving feel and, yes, reliability - you need to own one before you believe what Consumer Reports feeds to you), but that doesn't mean one takes one warranty from Chrysler and compares it apples to apples with a Honda or Toyota warranty.

    Posted by FJ April 1, 09 02:49 PM
  1. raymond, good points - GM did themselves in, no one should be bailing fatcat union workers and execs out. Let assets that people dont' value TRULY DEVALUE in the marketplace instead of propping them up with TAXPAYER dollars. Let GM go under if that's what it means. We don't have tariffs on foreign cars, nor should we. You'd like to think Ford, at least, is starting to turn it around, but if GM and Chrysler can't follow suit, I guess that means we only have room for one car company in this country. I'm fine with that, especially since many foreign auto companies have plants and american-specific vehicles made by non-union American workers. They're doing a lot more for this country than Obama's bailouts or Mexican-built Fords could ever do.

    Posted by FJ April 1, 09 02:51 PM
  1. If this were a burning building, the executives and the union heads would be arguing about which window to jump out of while the building burned down around them. It is unfortunate that innocent people will be hurt. The execs and union heads all deserve to end up broke and ruined, but it will be other people - that's the real problem here.

    Posted by bribeau April 1, 09 02:51 PM
  1. I hope GM stays around for a while I want a new Camero.
    I love big V8 cars.
    eat my dust Prius loser.
    I would not be caught dead in a Hybrid.

    Posted by joe joe April 1, 09 04:40 PM
  1. This entire city is filled with liberal idi0ts that just don't get it. This blog and so many others on prove this again and again. Our economy will be doing great when we're all just selling services to each other and not manufacturing a d@mn thing! I hate you all....

    Posted by BostonSux April 1, 09 07:02 PM

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Clifford Atiyeh is an automotive writer and car enthusiast . He has spent his entire life driving cars he doesn't own.
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