How Much Longer For General Motors + Ford?

[Tama]

For sale: four-bedroom detached bungalow, some work needed, cost: $800. The catch? It's in Detroit, home to the once mighty Ford, General Motors and Chrysler, and not many people want to live in the Motor City now that the American car giants are laying off tens of thousands of workers.

The bungalow is not the only bargain basement property up for grabs: thousands of others are on the market for $10,000 or less. One estate agent who has sold 50 properties - mostly foreclosures - in Detroit is trying to remain upbeat but admits: 'It is a blue-collar town like a lot of other American towns, but it has been hit harder than most.' He says there are houses are going for $5,000 while homeowners next door are struggling to pay a $60,000 to $70,000 mortgage on an identical property. 'It's obviously devastating for them.'

The Detroit property market and the US car industry are mirror images: both are in freefall. Speculation is mounting that the government is planning a bail-out of the giant 'Detroit Three'. On Thursday, Presidential candidate Barack Obama added to the clamour, calling for a doubling of the $25bn in government loans recently approved by Congress to help the industry make more fuel-efficient cars.

...

It's hard to exaggerate the scale of the crisis facing the Detroit Three; in many ways, they are in a more parlous state than the banks. In 2000, the high-water mark for the industry, the combined stock market value of Ford and GM was more than $130bn. Today, you could pick up both for $10bn and still have change. Citigroup analysts estimate that the pair are carrying $69bn of debt between them. Since 2005, the companies have been haemorrhaging money: in the first half of this year they lost almost $30bn. Paul Newton, analyst from consultancy Global Insight, says: 'The big three are in severe trouble. The past couple of years have been a bloodbath.'

$130 billion to $10 billion in 8 years - and with a debt the size of New Zealand's GDP...

...wow

[thorg]

mob: I blame Canada

or is it russia?

oh noes, its teh axles of weevels now . . .


all they need is to invade some cuntry to save tham and give them demography to saves them

[iodi]

all they need is to invade some cunzorry to save tham and give them demography to saves them

I see where you're going with that. So after the US invaded Iraq and Afghanistan, they should have banned all makes of vehicles except Ford, GM, and Chrysler. Captive market, perfect!

[Tama]

all they need is to invade some cunzorry to save tham and give them demography to saves them

I see where you're going with that. So after the US invaded Iraq and Afghanistan, they should have banned all makes of vehicles except Ford, GM, and Chrysler. Captive market, perfect!

If the Taliban didn't have it's Hiluxs they'd be screwed

[iodi]

all they need is to invade some cunzorry to save tham and give them demography to saves them

I see where you're going with that. So after the US invaded Iraq and Afghanistan, they should have banned all makes of vehicles except Ford, GM, and Chrysler. Captive market, perfect!

If the Taliban didn't have it's Hiluxs they'd be screwed

So both a military and an economic strategy. Even better

[dented]

NZ auto industry is also hurting, probably not to the same extent. But plenty of yard pwners taking the opportunity to get out when their leases are up lately.
My understanding is that a load of them are also on floor-plans (dont own their stock but finance it), and everyone is waiting on the same thing that has just happened in Australia, GE has callen in all floor-plans, and requested that they be repaid in full in 60-days. No negotiation.
The moment this happens, there will be workers all over the country given a little letter in a sealed envelope.

[Henry Dorset Case]

mob: I blame Canada

or is it russia?

oh noes, its teh axles of weevels now . . .


all they need is to invade some cunzorry to save tham and give them demography to saves them

Hey guy I'm not your budday

Hey Budday, I'm not your friend

Hey Friend, I'm not your guy

Hey guy, I'm not your friend

Hey friend Im not your budday

Hey budday Im not your guy.








Genius southpark writing.

[neels]

NZ auto industry is also hurting

New Zealand doesn't really have an auto industry any more, just a bunch of people that sell used japanese cars for the commission the get from finance companies. I suspect many of the ones that are shutting up shop are doing so because they don't meet the criteria for the more reputable finance organisations.

[Henry Dorset Case]

NZ auto industry is also hurting

New Zealand doesn't really have an auto industry any more, just a bunch of people that sell used japanese cars for the commission the get from finance companies. I suspect many of the ones that are shutting up shop are doing so because they don't meet the criteria for the more reputable finance organisations.

What is "reputable" in this context?

I thought GE had pulled yard plans galore already. Alternatives are MTF and Marac really.

Its a sector due for a shakedown but as always good operators will survive and prosper.

[dented]

NZ auto industry is also hurting

New Zealand doesn't really have an auto industry any more. . .

Youre not thinking 4th dimensionally!!!1

Whats about the car groomers, the parts suppliers, dismantlers, vehicle compliance centres, seatbelt suppliers, panelbeaters and spraypainters, windscreen chip repairers, tyre retailers, mechanics, pinstripers, paintless dent repairers, etc, etc, etc.
You must realise that for many years all the businesses listed above have had some percentage of their income made up by a steady stream of regular business from Used Vehicle Sales dealers, some more than others. Think about how a massive downturn in Used vehicle sales will affect these business, the employees of these businesses, the landlords for these businesses.
Whether you like to admit it or not, it is an industry. And while you are on the bandwagon of blaming the downturn on the finance side of things, spare a thought to the amount of regulatation that has been placed on the importing of 2nd hand Jap Imports in the last 6 years, by a Labour Government, and weigh up how much impact you think that has had. And they said they were trying to make the place 'greener'.

Golly, I look back at that and it almost looks like a rant. Funny that

[j2hyde]

On Thursday, Presidential candidate Barack Obama added to the clamour, calling for a doubling of the $25bn in government loans recently approved by Congress to help the industry make more fuel-efficient cars.

$130 billion to $10 billion in 8 years - and with a debt the size of New Zealand's GDP...

...wow

So obama wants to give a bunch of companies who produce shit products that nobody wants a heap of public money, when there's no chance they are ever going to pay back what they owe now?

Genius.

[Kazmeistyr]

Hardly surprising. If you make utter crap products, marketing will only take you so far.

GM, Ford etc. have been making terrible products for decades, if not forever, and in a terribly unethical way ( Ford Pinto, anyone?).

They've been going down the gurgler for decades. The Japanese have been wiping the floor with a better product - it's only been a red-neck patriotic stance keeping them alive at all.

Same thing here in OZ - you can tell a Ford or Holden man by looking at them, and their creed is dying off at a great rate of knots.

[j2hyde]

Same thing here in OZ - you can tell a Ford or Holden man by looking at them, and their creed is dying off at a great rate of knots.

Again, all supported with public money. The oz auto manufacturing industry is subsidised to the tune of about $24K per manufacturing employee, per year. That money would be better spent on other things.

[Tama]

Same thing here in OZ - you can tell a Ford or Holden man by looking at them, and their creed is dying off at a great rate of knots.

Again, all supported with public money. The oz auto manufacturing industry is subsidised to the tune of about $24K per manufacturing employee, per year. That money would be better spent on other things.

Beer and skittles?

[j2hyde]

I was thinking higher education, R+D. But yeah, beer isn't a bad idea.

Or the government could just buy everyone japanese cars. $24K Aus will get you a nice japanese car. Discount for buying in bulk, etc.