Euro-Bailout Throwdown

Automotive News Europe [sub] is hosting a point-counterpoint throwdown on the proposed 40b Euro bailout of European automakers. And like the debates we’ve survived over the last few weeks, even the pro-bailout advocates can offer only qualified support. At best. ANE Chief Correspondent Luca Ciferri jumps into his argument with the ambivalence that a billion-dollar giveaway demands. “Would I be happy to contribute some of my tax money to the European industry?” Ciferri asks himself rhetorically. “Not at all,” comes the answer. Great, so why do it? Because the Americans, Koreans, Japanese and Chinese all do it. Despite the fact that European automakers have garnered strong reputations on their own merits. Meanwhile, ANE Editor-in-Chief Arjen Bongard lays into the plans with gusto.

As in the US, European automakers are asking for the cash as compensation for regulation. But as Bongard points out, “if you want less regulation, you shouldn’t ask your regulator to help fund your business. This is asking for trouble.” Bongard goes on to argue that whether in America or Europe, bailouts are bad juju. “Big loan programs on either side of the Atlantic would set off a new wave of allegations that national carmakers are being unfairly subsidized. And, in a world where car companies are more and more looking at international cooperations and joint ventures to lower costs and boost efficiency, that’s unhelpful, to say the least.”

Porsche agrees, telling Auto Motor und Sport that the EU can take their bailout and shove it. And why wouldn’t they, considering they’re staring at the largest profit in the firm’s 60-year history? Blasting other firms for privatizing profit while socializing loss sounds great… too bad nobody else makes enough money to afford that kind of principle anymore. Oh and German finance minister Peer Steinbrück has said he would “not be prepared to offer support for the automotive industry or promise any tax concessions.”