Auto Bailout

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It started with the $700 billion bailout in October, and now the big three automakers in Detroit are begging the government for their own $25 billion bailout.

Where do we as taxpayers and a country draw the line?

When did it become the responsibility of the US government to give billion dollar checks to private companies simply because they suck?  A lot of car enthusiasts and industry specialists have been saying for years that the American automakers need to switch up their game.  The Japanese and European automakers simply make better more fuel efficient products.  If your product has no passion what makes you think someone would wanna buy it?  GM has 13 brands worldwide and has over 8,000 dealerships in the US alone.  Toyota on the otherhand has only 3 brands and around 1,500 delearships in the US.  Even with the gap in those numbers in 2007 Toyota managed to manufacture 9,497,754 vehicles and GM only reached 9,349,818.  Why doesn’t GM cut delearships and consolidate some brands.  The majority of their products are just rebadged duplicates anyway.

GM has another problem with all the union contracts they created and retired employees.  GM offered a grow-into-retirement plan for workers that had been with the company between 26 and 29 years.  This offer meant retiring workers would get 65% of their wages starting the day they leave and continuing up to the 30 year mark.   Then they will begin to receive retirement benefits a voucher for a car and a lump sum payment somewhere between $50,000 to $96,000.  So if I began working for GM when I was 23, by the time I reached 53 I would be receiving all of these perks.  With the money GM is pouring into this program, they could be trying to figure out a better material to use for the interior of their cars.  I don’t want to sound like I am bashing the automaker, but I find it hard to have sympathy for a company that refused to produce better products until it was too late.

GM, Ford and Chrysler employ hundreds of thousands of people, it would be a tragedy to see them take a fall.  If they do, the companies themselves are the ones to blame.  $700 billion for financial companies and $25 billion for the auto industry… where did Joe go and why is nobody crying socialism yet?

GM says that without this bailout they could be broke by the end of the year.  Here is a video the automaker posted on youtube.

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