GMAC will become the financing source for new Chrysler cars,” the official said on background. GMAC will handle both wholesale and retail financing.
So then you make thousands of Americans unemployed. They in turn stop buying everything. Other industries are hurt. They lay off people. They stop buying things. Rinse, repeat, until no one has a job.
.
But dumping billions into a company is gonna fix the problem? The problem is the company failed and now they are closing. Billions of dollars is not gonna do anything but extend the problem and make things worse all around.
Let the company fail. Best case is that an Asian company buys the plants and maybe produces something here.
Look at all the layoffs in WNY alone. Why don’t those companies deserve a bailout but this one does?
i just heard the UAW will take on 55% of Chrysler llc. is this true or bs?
They are providing them with the financing that dried up as a result of the financial industry accidentallying itself, and the legal means to restructure the business. They’re not saying “Here, I like you so have this free money.”
:word:
And the layoffs in WNY, although they suck, are small potatoes compared to an American automaker going down, where it has the potential to screw things up from a macroeconomic perspective. Everyone has a stake in seeing them survive and become able to pay off their debts and get back on their feet. If they liquidate, everyone loses.
No one wants them to liquidate. It just would have made more sense to go into bankruptcy and restructure with GOV money instead of giving them all the money first.
It sounds like boxxa does
Depending on how things go, Chrysler may have to liquidate some. The guys that balked have “secured credit”, meaning that they had collateral-backed loans. These are usually the ones that get paid first in any Chapter 11 reorganization - though it depends on how Cerberus wants to handle that.
As for the UAW having 55% of the new Chrysler, I’d bet that they won’t have any say - outside of maybe a board member - as the shares are supposed to go into the VEBA, and not the UAW directly.
– 55% will be owned by the Voluntary Employee Beneficiary Association (VEBA),
- 10% shared proportionally between U.S. and Canadian governments,
- 20% owned by Fiat.
– 15% of company will be distributed to Fiat in three 5% increments for meeting the following goals: creating U.S.-built 40-mpg vehicle platform, providing a U.S.-built fuel-efficient engine family and giving Chrysler access to global distribution network.
Some liquidation is inevitable. The industry, as it currently stands, is just too big for the market right now. The larger financial/economic situation of the US economy just brought the festering sores of the auto industry to the surface, after years of ignorance and neglect.
55% employee ownership? Did a young engineer that had just designed a motor that is fueled by static electricity in the air stand up at the announcement and say “Fuck you I’m out!”?
Crazy world these days…
They really do have that much in liabilities to employees and retirees…mostly health care.
So if our government has ownership they could hypothetically make automotive standards to fit GM and/or Chrysler cars and screw Ford right out of business?
They could also ignore OSHA and the EPA because they(the govt) won’t fine themselves right? lol.
There are definatley a lot of unanswered (or unasked) questions in these deals.
Maybe if the government was one single entity…
MMM I smell FIAT cars being sold in America with in the next few years.
YES!
Fiat Grande Punto Abarth would be hot or maybe a 500. The rest of the brand is pretty blah though.
They’re all in on “it.” :tinfoilhat:
You mean like once Franken is seated?