Detroit's Reasons To Be Cheerful Pt. 2

Robert Farago
by Robert Farago
detroits reasons to be cheerful pt 2

Now that Chrysler's HR honcho Nancy Rae has sent us a primer for pessimists, it's time for The Detroit Free Press to find some light at the end of the tunnel that doesn't look the headlight of an oncoming train. First the bad news, albeit with a light dusting of sugar coating. "Detroit's automakers are bleeding cash, despite massive cost-cutting and job reductions in recent years," Justin Hyde "reports." "And while each has socked away funds, the money will last only until 2010 at the latest unless the companies borrow to buy more time, analysts say." And then, hints of hope(tm)! "If you're looking for some sign of light in the gloom, there are glimmers. Unlike previous slumps, the vehicles built by Detroit's automakers are broadly on par with much of their competition. The landmark deal that will lead the UAW to take on health care for workers will free up cash in 2010, especially at General Motors Corp. All three companies are pushing new fuel efficient models, with side bets on more exotic technology such as plug-in hybrids." But even Hyde can't. "But a permanent cure — generating enough cash to pay their debts as they roll out new vehicles — appears unlikely before 2011, and another unexpected jolt could tear one or more of them asunder, analysts say." What corporate arrogance has created, let no market rent asunder? Good luck with that.

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  • Toxicroach Toxicroach on Jun 23, 2008

    Actually, Toyota & co are publicly traded companies. As are, obviously, the American companies. Which means the profits are going to whoever wants to buy the stock, whether they are in Japan, America, Zimbabwe, or the frigging moon.

  • Joeaverage Joeaverage on Jun 23, 2008

    I WANT to buy GM or Ford products. Chrysler not so much. I've driven VWs and Hondas for the past 18 years with good success. Actually compared to my family and friends who primarily buy domestic products - I have had MUCH better service out of my imports than they had out of their domestics. I don't have to put my $15K+ on the hood to try life with a domestic. I can watch my friends and family. My wife & I have been early adopters for all sorts of new tech compared to our friends and family. You'd think we'd try a domestic vehicle - just to see if the car is truly below par or it if it the care the cars recieve from our friends and family... Still not sure I can spend that kind of cash. $250 for a gadget is one thing. A bunch of money to replace a poorly engineered or manufactured automatic tranny at 80K miles is another. I WANT to buy domestic but they continue to ignore the segments we buy. We buy compacts. Not just cheap and cheerful cars but clever cars with clever features. Detroit doesn't build those. The closest they come is the Astra and the Focus hatch. We'll give them a look but nobody hold your breath.

  • Oldyak Oldyak on Jun 23, 2008

    Dear: "tokyoenthusiast" It sure is a compliment to recieve such a well written summary of the label that has been applied to a middle class american who is just making ends meet. I have to give you credit for your ability to turn my concern for U.S. prosperity into a joke on 'me'. You seem to imply that I was japan bashing.I harbor no resntment to any car manufacturer regardless of origin. It just boils down to this.... I just want to see folks trying out new offerings from the Big 2.8 nothing more...nothing less. The American middle class is being driven(pardon pun) out of existence and they were the buyers of American iron. I cant think of a way to change this other than to get the well paid liberals to try an american cars. They sure have a lot more money to risk on a car purchase than most middle class... and so it goes...the folks with the money wont give american cars a chance,and the builders and suppliers of american cars wont be able to afford to buy them. Pretty simple...and sad and so it goes...the middle class! have an espresso on me!

  • TokyoEnthusiast TokyoEnthusiast on Jun 23, 2008

    Oldyak, I wasn't trying to belittle your point that much, and if you are hurt I apologize to you sir. I do strenuously disagree with the idea that many of the car-related manufacturing jobs deserve a middle class salary. I studied 5 years in college, took risks, and am earning a fairly good salary. You can put the egg-head label on me, but I deserve what I get - they can't replace me with any sort of ease. Why should someone, whose job can be replaced by a robot, be paid the same? I don't begrudge someone the efforts of a good negotiating effort, but remember that maintaining manufacturing supremecy requires using the latest technologies. These technologies were stymied by workers who (rightfully) feared losing their job. As a result, labor-intensive manual labor (that should not exist due to potential advances in robotics) have moved to China, rather than remain in America (as the domain of American robots). Let me make it simple. The job is tough but it didn't have to be. Sacrifices had to be made, but no one wanted to make them. Money plays no favourites, and quality issues haunt a company forever. My last three cars were a Ford Mustang, an Oldsmobile Alero and a Ford Taurus. The Taurus needed a new transmission (but was generally decent), the Alero has the worst seats ever put in a car and had terrible fuel efficiency, and the Mustang needed a new alternator at 30,000 km. Guess why I am a 'Tokyo' Enthusiast?