Comments on: Bailout Watch 195: As the Worm Turns http://www.thetruthaboutcars.com/bailout-watch-195-as-the-worm-turns/ The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. Sun, 22 Nov 2009 05:06:58 -0500 http://wordpress.org/?v=2.8.6 hourly 1 By: fallout11 http://www.thetruthaboutcars.com/bailout-watch-195-as-the-worm-turns/comment-page-1/#comment-957572 fallout11 Mon, 17 Nov 2008 15:13:43 +0000 http://www.thetruthaboutcars.com/?p=153752#comment-957572 It should, as that was Paul Verhoeven's intent. Note the resemblance between OCP's corporate headquarters and RenCen, plus the Detroit setting. It should, as that was Paul Verhoeven’s intent. Note the resemblance between OCP’s corporate headquarters and RenCen, plus the Detroit setting.

]]> By: AG http://www.thetruthaboutcars.com/bailout-watch-195-as-the-worm-turns/comment-page-1/#comment-957172 AG Mon, 17 Nov 2008 07:55:10 +0000 http://www.thetruthaboutcars.com/?p=153752#comment-957172 GM reminds me of OCP. GM reminds me of OCP.

]]> By: MOSullivan http://www.thetruthaboutcars.com/bailout-watch-195-as-the-worm-turns/comment-page-1/#comment-956041 MOSullivan Sun, 16 Nov 2008 20:59:32 +0000 http://www.thetruthaboutcars.com/?p=153752#comment-956041 The three US companies should be treated differently but bailout legislation has to treat them the same way. The prospect of Cerberus being given billions of taxpayer dollars to salvage a bad investment is startling, to say the least. GM probably cannot carry out the radical restructuring it needs to become competitive outside Chapter 11. Bailing it out to stagger along with 8 divisions and 80+ nameplates won't result in a viable company with a decent return on capital even in a stronger economy. GM's problems did not start recently and they are not all exogenous despite what management wants people to think. Ford might have a chance. It doesn't have the organizational bloat that is sinking GM and it has a lean portfolio of good cars. If one were to hold one's nose and bailout just the company with the best chance of success afterwards Ford would be the one. There is no telling if an auto company could survive Chapter 11. The auto companies say they couldn't but there is no evidence. There hasn't been an auto maker of significant size go bust in the US for a long time. Americans have become used to companies operating in Ch 11 for a long time, like United which spent 30 months in protection. Of course a vehicle purchase is a long-tail transaction, unlike a plane ticket. The three US companies should be treated differently but bailout legislation has to treat them the same way. The prospect of Cerberus being given billions of taxpayer dollars to salvage a bad investment is startling, to say the least. GM probably cannot carry out the radical restructuring it needs to become competitive outside Chapter 11. Bailing it out to stagger along with 8 divisions and 80+ nameplates won’t result in a viable company with a decent return on capital even in a stronger economy. GM’s problems did not start recently and they are not all exogenous despite what management wants people to think. Ford might have a chance. It doesn’t have the organizational bloat that is sinking GM and it has a lean portfolio of good cars. If one were to hold one’s nose and bailout just the company with the best chance of success afterwards Ford would be the one.

There is no telling if an auto company could survive Chapter 11. The auto companies say they couldn’t but there is no evidence. There hasn’t been an auto maker of significant size go bust in the US for a long time. Americans have become used to companies operating in Ch 11 for a long time, like United which spent 30 months in protection. Of course a vehicle purchase is a long-tail transaction, unlike a plane ticket.

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