Desperate Times for the Big 3...As Most of You Probably Know...

Just thought I’d bring this up for discussion-sake. If you were in the position to, would YOU loan the Big 3 6.8 billion for their mistakes?

These captioned Autoblog pics are killing me hahaha:

http://www.blogcdn.com/www.autoblog.com/media/2008/12/detroit3ceoscanada_opt.jpg

http://www.blogcdn.com/www.autoblog.com/media/2008/12/bk_tr_cst.jpg

Good simple read for those who aren’t really aware of what’s happening:

I guess we really should help them out since it will obviously impact our economy, especially during these times…but this is pretty embarrassing.

This guy pretty much sums up the meeting:

"I’ve actually watched the CSPAN coverage and it’s actually entertaining. It goes something like this…

Senator: Hey GM, you messed up everything you’ve touched in the past 10 years. Now you want money from taxpayers.
GM: Yeah, basically!

Senator: Hey Chrysler, you’ve messed up everything you’ve touched, well, since you’ve been a nameplate. Now you’re privately owned, why can’t your owners bail you out.
Chrysler: It would be illegal under regulations (beads of sweat dripping down Nardelli’s head with a worried look on his mug) and there are pension funds involved and … and…and… and…

Senator: Hey Ford. Why exactly are you hear?
Ford: Well we wanted to point out that our quality either meets or beats Toyota and Honda, we have the safest vehicles on the road with the most 5 star crash test ratings of any company on earth, a completely new lineup of eco friendly cars and trucks, hyrbrids and we’re furthering our commitment to quality by making one global Ford.

Senator: What?
Ford: Oh, we’re just hear because if these two idiots don’t get the loan we’ll be in deep doo doo."

hahahahhahaha so good

i watched a bit of the live coverage when they had the hearing and it definitely was entertaining to watch.

i was 30min late for class, but definitely worth it.

i’d let them fail because why throw good money into bad. they don’t seem to understand anything.

last meeting they flew in with private jets and they got BURNED by congress.

i wished i watched…going to try to find a link to it after exams.

but yeah i heard about the private jet thing…guess they will still never learn…but our economy’s still pretty dependent on them regardless of our toyota and honda plants so even though i’d like to see them bite the dust, it’d screw us over pretty badly.

almost all of the tier 1 and 2 suppliers up here (magna for instance) have the big 3 as their main customers so you can imagine the impact of the big 3 disappearing… i really doubt they’ll disappear though…just doesn’t make economical sense really so we really have no choice but to lend our tax dollars to them. i guess it’s just a matter of settling on some agreement.


another interesting story which i believe led to the big 3’s downfall revolves around statistical process control, SPC. it was studied by some guy named Deming during WW2 era and i remember an engineer telling me awhile ago that just after WW2, Deming tried to pitch this idea of SPC to the big 3 but of course, they were too cocky at the time to consider it.

iirc, Deming then pitched the idea internationally for the automotive sector and the japanese saw the potential in SPC and jumped all over it. Deming then familiarized the japanese with the concept and ever since then it’s skyrocketted japanese quality and gotten them to where they are now. the big 3 realized how big of a mistake they made ignoring their own countryman and tried to adapt this as of the last couple of decades but of course, it’s very hard to teach an old dog new tricks.

most of the big 3’s quality relies on what is known as “the goal post” approach (1 post being an upper limit, the other the lower). so when a certain part is manufactured, critical dimensions are measured every so often at set intervals and tracked to see if they lie between the posts. this is a very lazy approach because all you really know is whether or not the part YOU’VE ALREADY MADE (ie. invested money into) is good or bad. you cannot predict the future trend of your production.

with spc, the goal posts are still there, but when measurements are stored and analyzed over time, a bell curve forms and by studying this bell curve you now know where the center of the bell curve lies and how wide your curve is. so you can effectively install countermeasures ahead of time to reduce the width of the curve (minimize variation) or offset the centerline (so that most of your parts are meeting the target spec).

in summary, the american’s were used to relying on a reactive approach for production whereas the japanese always try to be proactive, which saves the company a shitload of money in the end. you can see how after several decades of being reactive, the big 3 really struggled to adapt to a more proactive approach.

^^anyone please correct me if i’m wrong, but this is what i’ve been told before and it seems to make sense with the quality i’ve seen out of american cars vs. the consistency in japanese, for a vehicle in the same class.

case in point:

i think it was last year i went to the canadian auto show with this girl that knew nothing about cars. she brought up the quality question and since i didn’t really feel like explaining the above to her…

i told her to fiddle around with the heating vents when we sat in a TL. EVERY vent felt the same in terms of rotation smoothness, the finish quality, etc.

when we went to the skydome, we took a break in a Deville, and i then told her to do the same thing again with the vents inside. low and behold…there was 1 vent that was so seized into its place i actually had to use both of my hands to break it loose out of its place to allow it to rotate/pivot.

now if the variation in quality is that bad for the interior, imagine what’s going on under their hoods!! yikes! (i know, they’re probably a lot more tighter on control for the drivetrain…but still you never know…i’ve heard enough horror stories about them).

kimmerkaze,
that’s a pretty good explanation. I agree completely.
Even if the big three have been improving on their cars in the last 10 years, that’s still not going to save their asses, especially not in an economy we have today.

OK. Well, I’ve read a good bunch of articles on the collapse of the Big 3 and the impact on the economy, etc, etc, etc…

I just had to make this point…

Sure American cars lack in quality, but that never stopped GM from being the No 1 automaker for the longest time. I mean, we call them the Big 3 because they were the three largest automakers out there, and that can only happen when you (at least partially) know what you’re doing. This being said, I personally remember hearing about the quarterly losses and layoffs when the gas prices sky-rocketed, making the purchase of trucks and SUVs unattractive. The fact that Ford, GM, and Chrysler (not so much Chrysler) have lengthy line-ups of pick-ups and SUVs, which were no longer a feasible choice of transportation for the general public because of expensive fill-up costs, resulted in HUGE losses. (Consider the fact that the F-150 was one of Ford’s highest volume selling vehicle.) As if this weren’t enough, the general public started to panic and lost trust in these companies, without realizing that the losses were primarily from the SUV/pick-up divisions.

Finally, to wrap things up, I want to point out that I am NOT a fan of domestic cars, but we cannot deny their success and domination of the markets for a long time…

It probably won’t happen, but I’d like to see just Chrysler die out. IMO they’re far, far worse than the other two based purely on my experiences with various cars from the big 3. If they were to go down most of their customers would jump to either Ford or GM as opposed to an import, keeping their money closer to home. It would make a lot less of an impact if only one went down, then the loan wouldn’t need to be as large.

Please do let me know if I’m totally off base here, I don’t claim to be an expert on the situation by any means. I just know that Chrysler is on par with Lada.

they brought this upon them selves.

short and simple.

your selling cars with lifetime warranty for DIRT cheap. people bought em all up like hot cakes. everyone has a new car/truck/van/suv now.

with warranty…why buy another? yea it’s gonna hurt our economy. but really it’s already hitting us real hard. i say let em fall. they will rise again regardless.

just my not so educated opinion. (i don;t have much time to watch the news or read up on shit)

My thoughts is they have to give the loan. The jobs lost and the result from not giving the loan will be far worse to all of North America and result in chaos.

no lie it will be worse than it is now. but truthfully. how much worse? they have been closing plants left right and center for a LONG time now…

Now if we add a reason to why they close plants imagine the amount of jobs that may be cut. It will lead no doubt to a huge depression, even possible social unrest and/or war.

They have no choice to give a loan in my opinion and Chrysler is going bye bye. Jeep will live though. Time to buy stocks in Ford or GM roll the dice and pick!

if chrysler goes…jeep goes. and what of mercedes?

there are so many mergers. it’s ridiculous.

not to say i don’t give a shit. but this will not make my trade any worse than it already is. only better. call me selfish, but hey. it’s a dog eat dog world now.

war? not in Canada. I just can not see that.

War and Canada don’t go together often but if States do, we do.

Jeep will be sold it’s all they got. Mercedes will be fine the only thing that should go under is the Chrysler line.

I’m not any sort of economist, financial planner or anything this is just my thoughts btw.

same here buddy. lol

im in the trade. but really. i don’t pay too too much attention to things i probably should.

The basic argument boils down to the lobbying. It was pretty easy to pass on the 700billion bail out, in addition to the couple extra 100 billion that was ear marked for the financial sector. The ones pushing for the bail out? All had interests in all of those financial corporations, be it through previous employment, being members of the board, getting ear marks etc. Yet some how there’s such hesitancy to give a mere 30 billion to 3 remaining industrial producers North America has? It’s a white collar vs blue collar affair. The ones who stood to lose the jobs from the lack of the financial bail out were all white collar workers who are ingrained in the senate. The ones who stand to lose jobs from the lack of an automotive bail out are blue collar workers who have no footing within the senate and house. The only ones supporting the automotive bailout are…suprise, previous big 3 employees…members of the board…etc. It’s all lobbying baby… I know it sounds like I’m a conspiracy freak, but this isn’t a conspiracy, it makes sense.

I don’t think Canada should loan the them 3.8 billion. That’s not the way it’s suppose to work, their suppose to be allowed to fail. Then we watch something new and interesting fill the void. That 3.8 billion should be used to support the auto workers who are going to be affected and provide better back to school options for them, so that they can instead be the type of people that will fill the void with something more interesting.

I’m pretty sure a lot of the suppliers are looking to win programs from new non-big 3 customers so it may take a few years but the at least GM and Chrysler might be phased out of the picture in the upcoming years as contracts expire. I’d still put my money on the fact that Ford will still be around. I’m almost certain all 3 won’t go away, maybe 1 or 2 at most.

All Iz gotz to say:

http://zip.4chan.org/o/src/1228860347224.png (4chan doesnt allow img posting on forums)

one word “unions”
compaer how many plants have unions that are going under to the amount of plants without unions. you will find it very suprising.

unions pushed up the labour costs in return made alot of cars expensive. now there is a big crisis on our hands and the unions are doing fuck all about it.

my dad was a high up guy at ford in london.

the cost to build a ford crown victoria is approx $1800.00 in raw materials buts its for sale on the lots brand new for over $36,000.00

for every car sold by ford, $ 800 of that car goes to the ford pension fund

and whay are the costs of cars soo much ???

farmer

cuz capitalists tend to be assholes, i dont believe in capitalism or socialism, but something in between and it doesnt have a worldly political name.

THe big 3 need to take the big 3 steps to get successful.

  1. Go bankrupt to cancel ALL contracts and pensions
  2. Start over and pay $18hr max.
  3. Shoot and kill those who try and start another union.