Why the Automakers are a Mess

If these Companys really were in great shape and just needed a little help"cash" then there would be the private sector lining up to invest in them. With GM having a cap value of a little over 2 Billion Dollars, where is Warren Buffett? he could buy GM that is change for him.The answer is these Companys are losers and no one will touch them other then Uncle Sam. I think there will be a back lash to some degree in this country against the big three and they have it coming.

Dear Cheryl, I've had the opportunity and pleasure to work for both a Japanese and US manufacturing company during my long career, in both cases in a management capacity. Besides, the obvious cultural differences there was one thing that really stuck out : Japanese companies think and act long-term, US companies think and act short-term. The implications for the company strategy AND the way the blue-collar workforce is treated are obvious. Best regards, Johannes Belgium

It's not like the Big 3 didn't see this coming. America has had plenty of warnings that their dependency on oil was going to be a big problem in the near future. Instead of the Big 3 designing the next cool exterior or interior look, why weren't they working on better fuel efficiency. The Big 3 stay in check with Washington's laws for better fuel efficiency to just be slightly ahead or inline. Has anyone heard of market leadership? How many markets are flourishing where demand is high for product improvement(much better fuel efficiency rather than a mile or two per gallon), but the suppliers only provide mediocre improvements? If we can land men on the moon almost 30 years ago, why can't we make significant improvements in fuel efficiency without having a high price tag on the vehicle purchase for this improvement? Handing the Big 3 money to keep doing what they have been doing is the true definition of insanity (doing the same thing everyday and expecting different results). Set some strict rules on what any loan money is for. There have been a number of great companies started during tough times and any Big 3 management blaming outside sources for their predicament is just foolish. If they didn't have the foresight to see these issues coming, then perhaps there needs to be a change in management. There should be a mandate to produce cost effective alternative fuel vehicles (not ethanol) so we are investing in getting ourselves off foreign oil dependence. Let's take an opportunity here to assist someone in trouble while laying the ground work to help the entire country. After all most of these issues are linked and if we don't attack multiple ones at once, then we are just band aiding a problem.

The single biggest reason for the failure of the Big Three is QUALITY. I've driven Hondas and Toyotas for the last 26 years and NEVER (I mean NEVER) had a major mechanical problem of ANY kind. Just normal maintenance. In contrast, some of my friends and relatives own American cars and are constantly complaining about breakdowns and bad service. I gave up on American-made crap back in 1982 I had 3 American cars in a row give me trouble, and I've never looked back. I don't plan to either. I'm a patriotic American with a son in Iraq, but I'll be darned if I'm going to throw away my hard-earned money on second-rate quality. Message to the Big Three: File for bankruptcy and deal with your own mess. Message to the auto-workers: You're not worth the money you're being paid. Come out here in the real world with the rest of us non-union people and find out how it is to perform every day and work hard. No more bailouts!!! We're driving our nation into the ground. Quit whinin' and start workin'!

I find it amusing that all three company CEOs took private planes to D.C. to ask for money.

use the 25 billion for american car purchases only, 10,000$ credit for high mpg cars, lets get rid of inventory; then, impose a 10 cent per galloon tax to pay for retooling the industry (10 billion a year plus some added conservation).

Let's talk about quality, Ford is Crap, Gm is crap, Crysler is Crap. The big three are cranking out crappy cars. Crappy cars that suck gas faster then college students chugging beer. So it no suprise when the American crappy car reached the end of life 100,000-120,000 miles during the high gas prices, Americans started looking for cars that got better gas milage. My 10 year old Toyota Truck with 200,000 miles still gets an average of 28 MPG on the freeway and 25 MPG in the city. Fords best is 29 MPG and dies at 120,000 Chevy best is 22 MPG and dies at 120,000 Does crysler even make a truck worth talking about?

the big three are done !!! we can blame whoever we want, but, in the end it doesn't matter. bad products, bad mangement, overpaid union workers, who cares? i will vote against any of my senators or congressman who give one dime to these band of thieves. let them sink !!! michigan people, you have cast your lot with the democrats for years, now live with it.

My opinion in a nutshell. Honda, Toyota & Nissan have STRIVED to make energy efficient cars that people WANT to buy. Why you ask? Just go back in time a short while and remember how much you paid to fill up your car vs what you pay now. Don't get excited because it won't last. They planned ahead and they also make a car that will last. My Honda lasted 13 years with 330,000 miles with original engine. My (2) Fords that I had, well the first one the transmission went at 48,000 miles and 2nd one at 53,000 miles -but that was ok because it was a recall issue. Sorry but I think I will stick to the well made fuel efficient vehicles from now on. The BIG 3 knew a long time ago that this storm was heading their way and they did NOTHING about it. Oh wait they did they built more GAS GUZZLERS. Shame on them!! Why should we have to carry them for their ill planning. If any other company made those bad decisions they would not be in business anymore. Could it be that the BIG 3 have their hands in the same pockets as the oil companies? Gee I wonder. I think there is more than engines being greased over in Michigan.

I have had 4 Mazdas that have lasted over 200,000 miles. I have a Ford truck with less than 100,000 miles that has had both window motors replaced, front differential seal replaced, 5 new coils and now it has an exhaust manifold leak that is going to be over $500 to fix. The Mazdas have had nothing but oil changes and brake pads. So don't tell me we are being sold a bill of goods that the American cars lack in quality, the just do. Couple that with the age old work rules, unrealistic wages and seniority rules built into the union contracts and you get the current mess. The US companies put in robotics but can't eliminate any positions, so you have a bunch of UAW guys standing around watching the robots work, the manipulate the system so they don't work during the week and come in on the weekends to finish work since it is at the OT rate. While the base rate may be $28 per hour, the vast majority make far more than that with the OT and because they have been there so long (you can't get rid of anyone with seniority). My brother is a mechanic and he says there is no comparison in quality of workmanship between the foreign makes and the US makes. The US companies should look at Hyundai and copy what they did, the went from one of thw worst in quality to one of the best. They listened to their customers and made cars that they want, that have great warranties, that get good gas mileage and are very inexpensive. The only way to fix it is with drastic meassures and that takes them going bankrupt and reorganizing under bankruptcy. Will it hurt yes, but they will be better companies for doing it. That assumes they bring in agents of change that will make the tough calls, tough cuts and be a tough negotiator with their creditors and unions. BTW if you heard the UAW president on Hannity the other day he said that the union would make no concessions to aid the ailing companies. Hopefully Obama will keep his promises to all those union employees that voted for him....

Six figures... let's see how that works out. $70/hour x 40 hours = $2800/week. 52 weeks/year x $2800/week = $145,600. One, two... three... yeah, that's six figures. Contrast that with the Japanese / foreign transplants: $47.6/hour x 40 hours = $1904/week. 52 weeks/year x $1904/week = $99,008. That's $50,000 a year less, approximately, but I'd bet NO-ONE has the balls to say that getting paid NINETY-NINE THOUSAND DOLLARS A YEAR is "getting screwed." Especially considering most other manufacturing jobs - even most unionized manufacturing jobs - get around $40K a year. The American auto companies are paying their workers nearly four times what workers in other industries are getting. So, let's look at the executives, hmmm? Let's say there's 300 execs at each company making - call it $100 million a year. That's 900 execs, for a total of $90 billion a year. A bit high, hmmm? Clearly I'm exaggerating the number and amount of executive compensation, but I'm really tired of this argument. So. 3 million jobs, the auto execs say; 3 MILLION manufacturing jobs will be lost if the Big Three go under. so, 3 million-900 = 2, 999,100 jobs that will be eliminated that are non-executive. So, how expensive are all those line workers? Well, using the obviously false math of the people supporting the unions, those workers are costing $436, 668, 960, 000 a year. I seriously doubt that any of the figures for this, in this article or anywhere else are close to accurate. But based on the knowledge that the auto industry doesn't make 436 billion dollars a year, and that both worker costs and executive costs must be much lower than the figures I've given here, I can say: executive compensation is a drop in the bucket. If you're after the execs for bad leadership, yaaaaaaaay! Go, you! But if you're thinking you can afford the workers, by cutting off the execs, you're flatly wrong.

Interesting chart. Where do you fit on it?

I just keep wondering why nobody is asking the question "Will a bailout prevent any layoffs?". The argument I keep hearing about the bailout is that there are thousands and millions of jobs at stake. But, as soon as the automakers get the bailout won't they start laying off workers and closing plants to become more competitive?

It's obvious most of you don't have a clue about the BIG 3. Trust me! I don't make 6 figures as most of you think. I have 32 years of service with GM and have enjoyed every year of it. Cheryl needs to confirm her facts and figures before reporting incorrect information. The BIG 3 aren't asking for a bailout. Myth No. 1 Nobody buys their vehicles. Reality General Motors Corp., Ford Motor Co. and Chrysler LLC sold 8.5 million vehicles in the United States last year and millions more around the world. GM outsold Toyota by about 1.2 million vehicles in the United States last year and holds a U.S. lead over Toyota of about 560,000 so far this year. Globally, GM in 2007 remained the world's largest automaker, selling 9,369,524 vehicles worldwide -- about 3,000 more than Toyota. Ford outsold Honda by about 850,000 and Nissan by more than 1.3 million vehicles in the United States last year. Chrysler sold more vehicles here than Nissan and Hyundai combined in 2007 and so far this year. Myth No. 2 They build unreliable junk. Reality The creaky, leaky vehicles of the 1980s and '90s are long gone. Consumer Reports recently found that "Ford's reliability is now on par with good Japanese automakers." The independent J.D. Power Initial Quality Study scored Buick, Cadillac, Chevrolet, Ford, GMC, Mercury, Pontiac and Lincoln brands' overall quality as high or higher than that of Acura, Audi, BMW, Honda, Nissan, Scion, Volkswagen and Volvo. Power rated the Chevrolet Malibu the highest-quality midsize sedan. Both the Malibu and Ford Fusion scored better than the Honda Accord and Toyota Camry. Myth No. 3 They build gas-guzzlers. Reality All of the Detroit Three build midsize sedans the Environmental Protection Agency rates at 29-33 miles per gallon on the highway. The most fuel-efficient Chevrolet Malibu gets 33 m.p.g. on the highway, 2 m.p.g. better than the best Honda Accord. The most fuel-efficient Ford Focus has the same highway fuel economy ratings as the most efficient Toyota Corolla. The most fuel-efficient Chevrolet Cobalt has the same city fuel economy and better highway fuel economy than the most efficient non-hybrid Honda Civic. A recent study by Edmunds.com found that the Chevrolet Aveo subcompact is the least expensive car to buy and operate. Myth No. 4 They already got a $25-billion bailout. Reality None of that money has been lent out and may not be for more than a year. In addition, it can, by law, be used only to invest in future vehicles and technology, so it has no effect on the shortage of operating cash the companies face because of the economic slowdown that's killing them now. Myth No. 5 GM, Ford and Chrysler are idiots for investing in pickups and SUVs. Reality The domestic companies' lineup has been truck-heavy, but Toyota, Nissan, Mercedes-Benz and BMW have all spent billions of dollars on pickups and SUVs because trucks are a large and historically profitable part of the auto industry. The most fuel-efficient full-size pickups from GM, Ford and Chrysler all have higher EPA fuel economy ratings than Toyota and Nissan's full-size pickups. Myth No. 6 They don't build hybrids. Reality The Detroit Three got into the hybrid business late, but Ford and GM each now offers more hybrid models than Honda or Nissan, with several more due to hit the road in early 2009.

Here's my reply to Tim Laughlin, who commented @ Nov 18th, 2008 at 4:32 am. How about checking out what GM actually makes instead of just an uninformed opinion. You said the last GM car you drove was a brand new 2008 Monte Carlo. Too bad there is no such thing. The last Monte Carlo was made on June 19, 2007. This was a car that was basically designed for the 2000 model year and had mo major changes since then. The current vehicles sold by GM are mostly new designs, no more than a few years old. Don't compare last generation vehicles to the current generation. Chevrolet Aveo - current generation introduced in 2005. Chevrolet Cobalt - introduced 2005 model year. Will be replaced by Chevrolet Cruze in 2009 & 2010. Chevrolet Corvette - current generation introduced in 2006. Chevrolet HHR - Introduced 2006 model year. Chevrolet Impala - Current generation introduced 2006 model year. Chevrolet Malibu - Current generation introduced 2008 model year.

Please, some of you stop knocking the big three vehicles and acting as if we would not miss them. I drive a 1990 Mercury with over 100,000 miles and have two 1994 Ford pickups with plenty of miles and have had practically no problems with any of them, so don`t give me that story about them not being good vehicles. Also, complain about overpaid executives that are not doing their jobs and are making hundreds of times what the workers are that are at least doing something productive. Remember, we usually do not appreciate what we have until we lose it.

darlene, the 'klunkers' they built in the 80s and 90s are the reason for the decline in business. i never got 100,000 miles on my chevy, but on my hondas no problem. now why should i go back to chevy? they ripped me off for years. now, at one time GM sold 65% of all cars in america, now its below 30%. and they did it to themselves. as for ford or whoever outselling honda, honda sells every car they can make, they don't have the capacity of ford. don't play that statistics game with us, the big 3 are crap companies and have been for 30 years. let them fold, and let them take detroit and michigan with them. you can thank bad management and bad government for this. to lend these companies any money is worse then a bank lending a gambling addict money. at least the addict might win, and pay the bank back. the big 3 are so over its not even funny.

The only hope for us to has US cars built in the US by US comapnies is: reduce the labor cost that would be labor (unions), the number and pay of middle management, and have upper management take hughe pay cuts and have the pay be based on profits (if you can't make the company work you earn very little). invest in product. People buy cars based on feeling and looks ect. only buy materials from the best most competively priced suppliers. make great product. control distribution...Toyata has less than 2000 dealers, GM has over 6000. GM's worst competition is the other GM dealer down the street get rid of the fat...yes the fact that GM has 6 private jets is an issue...not just the cost of those jets but more the mind set that it is not seen as a problem by management. this just shows they are not focused on cutting to the bone. everyone flys coach (even ceo/pres/management they can use laptops and black berrys while waiting for flights to remain producitve like the rest of the business travelers)

I am not a plumber yet but I want to be one so I will call myself one. I am shocked that the people that this country elected to represent us to distribute our taxes don't show a little bit more anger towards the nonchalant attitude that the 3 CEO's and mister "gold-digger" displayed while sitting in front of them demanding 25 billion dollars of our hard earned money. You have to admit they are good..... I couldn't even see the guns they were holding as they threatened the future of America. Does anyone at the white house even know how to use the internet? You can go on line and see the outrageous saleries the upper management is taking down. Private jets to fly to DC is nothing compared to Ford CEO flying from Detroit to Florida every Monday and Friday because he works in Detroit and has is mansion in Florida. After enough bad press he finally gave up the Ford private jet (and pilot) and now flies commercial. Why wasn't the run for the border for cheap labor to build cars a bigger issue? I am not going to get into all of the details but I will say that only one of the people questioning the panel today brought up the fact that Ford, GM and Chrysler have set up plants in Canada and Mexico and are building cars in those countries to be sent back to the USA to be sold to us that are footing the bill. Why couldn't those plants have been built in America and those jobs given to Americans? The imports are dying to set up plants in America and put Americans to work. As for the Chevy "Volt" this is going to be the biggest joke of the century for a new car launch. The price tag on this car is expected to be 40,000.00 (batteries included). In the 2010 model year this car won't sell due to the fact that the American people won't have enough money to buy one because of the higher taxes we will be paying to recover from the bail-out. In short I don't know what is worst, the car companies begging for 25 billion, the unions crying about how poor they are or the lazy government officials that don't want to spend a little time reseaching what it is they are actually spending our tax dollars on.

Six figures...I know someone that earned a high of 70k until the early 90's when she took an early buy-out and left GM. That is more than a lot of us thirty-something college grads have ever earned per year. AND, this was 15 years ago!!! Then there's the benefits.

The chart above does not reflect an apples to apples comparison of wages. The Foreign Auto Companies do not pay for health care and for pensions which are included in the USA Auto Companies hourly wages as an expense. And it does not reflect the consessions that the UAW has agreed to beginning and to be effective within a year. How much longer will the Big 3 Companies be asked to compete with Countries? The Big 3 pays for health care, pensions, R & D, higher corporate taxes, operate under protectionism and currency manipulation. No wonder they cannot get out from under the weight of the $$$$$ gorilla. The Foreign Transplants are propped up by their Country Goverments who fund health care, pensions, R & D, provide cheaper money, and basically keep knocking down competiton coming into their countires. How can we expect the Big 3 to compete in the US market or any other market WITHOUT A USA 21ST CENTURY MANUFACTURING STRATEGY? We cannot and we will continue to lose manufacturing jobs as the result of Congressional short sight. Am I the only person concerned about this? And for the love of all that is right and just, a bankruptcy of any of the Big 3 will bring down the entire food chain......BUYING AN AUTO IS A RELATIONSHIP.....BUYING AN AIRLINE TICKET IS A ONE NIGHT STAND. A Gov't backed warranty system means nothing except problems to the auto owner.

I have been a working as a CPA in the Detroit area inside the realms of the Big 3 for 15 years now. I know exactly how every dollar is spent and how every budget is developed. So that there is no confusion, every single employee at the Big 3 is overpaid by 20-60% depending on their job description. On average, they are overpaid by 40%. If the government wants to bail them out so to speak, then the only viable solution is that the government place restrictions on the money just like a bank. All the following would be in effect as long as any portion of the debt remains unpaid. 1) No more layoffs. You can fire someone only with good cause (the unions can help with this to ensure fairness). This will help the economy from worsening. 2) Union strikes are against the law. 3) All employees will have to take a 40% decrease in pay. Did you know the janitors are making over $25 per hour to work for 4 hours a day but get paid for 8 hours a day? Then the Big 3 gives them overtime when they need extra help!!! 4) All sub-contractors and all vendors (except utility companies) will have to take a 20% reduction in pay with all new contracts or contract renewals. Believe me they can afford it also as I have audited their books as well. 5) No debt forgiveness for any reason ever. 6) Pay increases are never to exceed current CPI (there is a very complicated formula which I will not bore you with now but it does exist). 7) No new job creations within management to simply get around any of the above items including #3. You can change the job descriptions, titles, add more positions available, but you can not simply "create a new position with a new pay scale". 8) Unions will have to take a 40% decrease in pay. Believe me they can afford it also. Benefits may have to be cut, but most of America is having to tighten belts and the unions should help by doing their part as well and not just asking for more and more. 9) The Big 3 are not allowed to "move" operations overseas unless the move is a requirement of that foreign country to sell into that country. In which case, that division of the Big 3 would not be able to sell into the US since it was began post bail-out. 10) No more "early retirement" packages. I know several employees that are past retirement age, are still working, making over $75,000 per year, with an opportunity to get over $100,000 in early retirement if they take it now. To pay a worker $100,000 simply to quit seems foolish to me considering they are over the retirement age anyways. If they want to work then see #3 above. If they want to retire then let them. None of the above is unfair considering other businesses do these things everyday to survive. Furthermore, until the wages for the Big 3 employees comes way down and is a closer match to everyone else in this country, I will be buying foreign to save ME and ONLY ME money. Why should I help fund early retirement for someone that already makes too much money in my opinion?

One more thing, do not trust anyone who actually works for the Big 3 or the unions or the government. They all have something to gain if this money gets lent out. The comments from Darlene are just propaganda. She does not want to lose her job. The Big 3 have had unfair hiring practices for years now. They preference family workers for jobs over everyone else (so to speak). You know who else does that? - The mafia! As an auditor, my job is to go into a company and report on the facts. I do not get paid more money or less based on how well or how much money the Big 3 gets. My job is to deliver fair results to everyone. And no, I never worked at or with the crooks at Arthur Anderson.

Congress and the Senate know very well the majority of the intelligent American people do not want this bailout given without a major restructuring. The US Auto is a money pit in need of a major overhaul that only bankruptcy can impose. Bankruptcy doesn't mean lost jobs it means restructuring to become profitable again. Let the Bankruptcy Court take down the UAW and the private jets!

Auto makers are a mess because they can't compete. They can't compete because they waste too much money. Management is overpaid and are showered with perks. Unions are overpaid, and often don't work when they are paid. They expect to be paid like a doctor but have the skills of a high school graduate. Too many on the payroll who are not working, whether in job banks, light duty, or due to having too many classifications to justify more people. All of this is ok with me until you ask me, the TAXPAYER, to bail you out. We should learn from our foreign counterparts: How to make quality vehicles, and how to stay in business. You must eliminate the word "WASTE" from your operation.

The big three should have been taking lessons from the upstarts in the 60's. I think its pride that has blinded them over the years and the arrogance of the union officials. We should be looking into the unions business model and expose them for what they have become and who they associate with. It seems that the autoworkers have benefits and wages that no other industries have and have been insulated from the affects of an economy in the downsizing mode by agreements that are not sustainable. Giving or loaning to a business with these issues is just bad business and we should let them restrucutre and renegotiate their contracts with the unions or else let them wither on the vine and let the natural process of quanity supply and quanity demand takes its course.

I am driving American cars since decades. How about being patriotic and buy American cars. Why do I see bumper stickers " Obama/Biden" on 95% of foreign cars? The same people who want to bail out the American car manufacturers, support the Unions who created the above hourly rates in the first place and advertise job creation? If they would be serious to save the jobs that might be lost they would not buy foreign cars and nobody had to put up their hard earned $'s to bail out any American car manufacturer. How many Asian people have you seen on the road not driving an Asian made car? They even rent preferably Asian made cars!! They are loyal to their own workers, treat them well, do not need Unions and do not have to bail out their car manufacturers! How about forming a strong consumer group instead of corrupt Unions, demanding the type of products the consumers want, tell the stock holders to fire the failed management and make the earnings of the new management attractive but dependable upon the success of the business (remeber Iacoca?). In return the consumers would pledge to buy American cars as long as they are competitive. Automatically the workers had to be treated well by the management because they are a big part of the success of a new management. This would be the real change we all could live with!!!

DISBAND THE UNIONS OR MAKE THE USA A RIGHT TO WORK COUNTRY. THOSE WHO WANT A UNION ARE FREE TO JOIN, THOSE WO DO NOT CHOOSE TO JOIN ARE NOT REQUIRED TO DO SO, IS THAT NOT AMERICAN?

For the uneducated worker.. the wages above represent fully burden rates. That means the wages shown include an average of all the benefits the workers receive ( what it actually costs the company to employee the hourly worker). The fact that some of you don't know this just demonstrates that you're uneducated about the facts of this debate. Regarding the "great strides" in quality pertaining to the big three.. get a copy of the latest Consumer Reports buyers guide. Go to the auto section and read the part titled "best of the best" and "worst of the worst". The ration of big three ( worst of the worst) to the Japanese auto makers ( best of the best) tells the story. Big three products are clearly inferior. Aside from the burden that the UAW and executive compensation has saddled the US auto industry with, their product basically sucks. Wake up people. Produce a quality product at a competitive price and you will have more than your market share. Chapter 11, however painful will allow the big three to clean house and shed some of the excess that makes them uncompetitive. A commitment to producing a quality product, not just a slogan, will lead to your success. The Toyota plant in Texas recently closed down for three months and continued to pay the work-force. They will re-open in December, having spent the time re-tooling to produce a different ( more fuel efficient)model. Will any of the big three be able to accomplish such a task in three months ? in six ? in a year ? The answer is no. Do not throw good taxpayer money after bad. Clean house and start over. Sooner or later, it will happen.

I know you better get an updated chart, that one is form about 2006

Great thread! More light than heat. Here's a few thoughts. First, American cars are not as bad as some are saying. I donated my Town and Country to charity at 240,000 miles and still running well. My second one has 108,000 miles and is just broken in. It gets 26+ highway, and I like it much better than any foreign minivan I've been in. Second, unions richly deserve our criticism. Restrictive work rules and over-generous defined-benefit pensions have to disappear. But they are not the whole problem. Third and most important, management is the largest part of the problem. My golf buddy has had dozens of consulting contracts with auto companies. His judgement is that GM has the worst factory management of all. Executives are responsible for much of the high manufacturing costs, poor product mix, weak designs, and all the rest. I say, no bailout unless we get to shoot the executives first.

Your graph is spot on to what one of the main issues is with the Big 3 auto firms. Labor cost are not the only problem B3 auto's have. Let's not forget unfunded manidates from Congress and poor economic conditions also are contributing to their weak position. Labor costs that are 40% above marketplace conditions and outdated work rules that kill productivity, are and continue to be the main problem with B3 Auto's. The heck of it is B3 executives and the head of the UAW want us to believe that the pancea to all of this is comming in 2010. I say BS to that kind thinking. The UAW can take a 40% reduction is wages, salaried workers from the B3 can do the same and all executives making more than $150,000 per year (including the President of the UAW) can take a 50% cut in their compensation. That puts them equal to the transplants. If they do that and Congress can suspend some or most of these unfunded manidates for a couple of years so the B3 can get back on their feet. The $100b in funds that they will really need, won't be needed from the tax payers. Lets start telling it like it is and stop tap dancing around the real problem and that is LABOR COSTS.

It is interesting that congress will make scape goats out of the big three auto makers but no one in congress will address the fannie mae and freddie mac failure and what they did to bring about its failure. A business or industry that is both top heavy with highly compensated employees and a union that represents a work force that is unwilling to face global competition does not need the government to bail them out but instead that business and industry need to come to grips with how they are structured and remake themselves through restructuring with the focus on quality, pricing and profitablility. There is plenty of blame with management and unions to go around that the last thing is for government to come in and side with one side or the other and promote the government's agenda by using political blackmail as leverage to gain political support. Anyhthing congress has been involved with in the private sector has always lead to disaster, bigger government , higher cost to the public, and lessor competition. When senator Harry Ried announced that congressman Barney Frank and senator Chistopher Dodd are very skilled and are capable in fixing this problem made me sick because these two are the ones behind the mortgage criss and now want to lead the auto bailout, go figure. The new administration should quickly distance themselves from these three failures in congress and move to throw them out of office. This would go a long way in proving the new administrations leadership and credibility.

Why???????? They sent the US jobs over seas for the quick dolor; they didn’t look long term again. Well that is the main reason, and the second reason is the members at the little 3 make to much money. Fix theses two problems and everything will be ok. There is no other way. It is this simple!!!!!!!!

GM and the union did it all to themselves. I had 13 years in gm production and i took the last buyout this past februrary. I could'nt believe the things that went on there. The sense of entitlement that workers and union reps have is the take all for little as possible work is true. The skilled trades workers get pissed if they have to get out of their chair to fix something, they sleep most of thier shift especially thrid shift when the made up beds come out and don't get them pissed if they can't get sunday work when they watch the sports channel all day long. I had a production job where could sleep half the night. I would get my work done and be out in the parking lot sleeping the rest of the shift, or shopping. No need to go down the street to the bar, there's plenty of drink and drugs inside, anything you want, including prostitutes. Taking $850 home a week wasn't enough money for them, they want more more more. Management takes no questions during the business quarterly information meetings. We've asked about electric or hybrid cars over 10 years ago. Deaf ears they have. Stuck in the 50s. The union is in bed with gm, taking bounuses for shutting up the employees. EVERYTHING THEY TELL IS A LIE. Union reps make 120,000 year. They only look out for themsleves. They are more crooked than management. Along with the sexual harrasment from my own committee man and gm cancelling my health insurance 11 times in the last two years (had no health insurance for the whole last year) I decided to jump that ship. They been living in their own fairyland for too long. I hope (for the execptions for a few really good people i've met in there)that they go way under. They deserve it.

GM, Ford, Chrysler, You've mismanaged your business for over 30 years. The UAW, Govermenment intervention, Corporate management, all have a stake in your failure. There is no easy solution for businesses and management that cannot learn from their mistakes. So, you get the tough solution. The UAW is going to tell their members that their pensions and health benefits won't be funded because their great benefactors, the Automakers are no longer viable companies. GM has to kill Buick, Pontiac,Saab, Hummer, and GMC. Ford, say goodby to Lincoln and Mercury Chrylser, just say goodby. US auto dealers, if you sell any of the big 3 products, think seriously of getting into another line of work. That's the reality of your situation. That's the cost of doing the wrong thing for too long. Goodby and Good Luck!

Heinz said: "I am driving American cars since decades. How about being patriotic and buy American cars." You do realize that this is the most ridiculous argument anyone could use, right? What will be my incentive as a consumer to spend money on an inferior product? Right, I would do it so that some guy at GM can have 96% of his salary paid while he sits in a closed GM facility doing nothing because his UAW buddies made sure there will be no layoffs. Pick up any Consumer's Report and check out the most and least recommended cars; also read what problems people face when they buy most cars produced by the Big 3. Being patriotic has nothing to do with how I choose to invest/spend my money (even so, if I buy a Toyota am I not supporting an American citizen who worked on this car somewhere in the US?). Bringing patriotism in discussion shifts the focus to areas that have nothing to do with reality. The only real question is: why are they in this situation? And the answer should be clear: poor management, lack of reliability and innovation, huge production costs and unreasonable union contracts. There is no guarantee that any of these companies will manage to change and pull themselves out of this mess even with a hand out from the government. Allow them to file for Chapter 11. Let them struggle, take pay cuts, work more hours for less in order to pull themselves up. Help them (and us) take pride in and ownership of the product they create. I am sure that, as soon as the word on the perfect quality if American cars will get out, everybody will rush to buy them. Myself included.

Let the automakers and the unions go into bankruptcy and reorganize. The unions were needed at one point in time because of the abused taken place in the corporate sector in consideration of wages, safety, and fair treatment. This role has warn out its welcome many years ago. The average college student who risks student loans and years without work is coming out of school and finding no jobs. And when they do find jobs, they’re at $8.00 - $10.00 per hour. The average autoworker who is uneducated has sacrificed nothing for his or her future in terms of student loans makes and average of over $100,000 per year (according to CNN news). There is not a human resource recruiter in the world that could place that worker in the real world for any more than minimum wage. There are doctors, engineers, attorneys, college professors, etc. that don’t make that kind of money. What message does that send to our children that spend all that time, effort and money to graduate and come out only to make minimum wage? It is difficult to get a degree. It’s a challenge and it’s a risk. I’m sorry the auto workers didn’t do the things in their life and take the sacrifice in their life to become educated. They have no skin in the game. Putting bolts on hubcaps doesn’t qualify for a doctor’s salary. This world is upside down. We need to compete on a global scale and that change needs to start here. We have to reward the people that strive to better themselves and for our country and take the risk to do so. We must not allow this imbalance to continue. I guarantee you a wage based on actual qualifications of an average auto worker will make our industry more competitive and affordable to the world. The day I see an auto worker putting lug nuts on a hubcap with a PHD is the day he deserves the $100,000 salary. Are you going ask the same men and women buried in debt for a welfare hand out? You know deep down as uneducated workers you are doing to our country the exact same things done to you when we needed unions. It is time to file for chapter 11. It’s time to make America great again. GIVE OUR CHILDREN A CHANCE!!!!

Overpaid is one of the Greatest Understatements of all time! They are burning through over 2 billion in cash per month and they can't even cut back when sales are terrible because they have to keep paying the Greedy Labor Union salaries. Now I really blame the Corrupt Union Bosses who think the rest of us poorly paid Americans should support these outrageously, disgustingly and disgracefully overpaid salaries of High School Graduates. Most people with Masters degrees don't even come close to these absurd salaries which are guaranteed for life thru unemployment and death. No they need to dramatically restructure and then get a bailout. If Gettelfinger sticks to his Greedy needs then he is helping to destroy America! Yes Bankruptcy would be bad but can be averted if the UAW would accept similar salaries to Toyota, a salary I might add that is still pretty darn good!

My husband has worked for GM for over 38 years. If the wages and benefits had not been offered he would not have worked at GM. For most people of any intellect, and he has pleanty, wages and benefits are the main reason a person applies for a job. The security of retirement is often the reason one stays. Many commentors have said that these people should take a 40% drop in wages. I think many of the commentators are very short-sighted. If they take that 40% drop-and sacrifice their homes and families so all of you can buy a cheap car I think this will happen: They will lose their homes and cars because the ability to pay for that home and car was based on their salaries at the time. They will not be able to sell their homes for what they owe on them. But then neither will those commentors, especially if they live near anyone who has been forced to lower their pay scale that way. They will be paying taxes for roads and schools at much reduced rate. Federal taxes will also be reduced. They will not be buying clothes, or cars, or recreational vehicles or jewelry, or cell phones, or anything that is not essential. They will not eat out or go to the movies. There is a lot more they won't be doing...like preventative health and dental care. I have this to say to those commentors: Just think of all the things that they will not be doing or buying and you might just realize that your job may be affected. In addition, many auto workers are smart...perhaps smarter than a lot of the commentors who are against them. They might just be looking for a new job in the future. Your job, perhaps, especially if you make more than the reduced rate you want them to accept. As far as I can see many of the commentors sounded jealous that they couldn't command the high wages the UAW workers get. Why not? Did they apply and just not get a job in the industry? Were they too fearful that they would lose their job to lobby for a union in their workplace? It sounds that way to me. They sound hard and bitter. Too bad about that overpaid other guy who caused me to have to pay more for a crummy, overpriced car, they deserve what they get. I guess these guys would like to take a 40% cut too, huh? Maybe then we poor UAW folks will be able to afford the goods and services they sell.

Anyone who works in management knows the basic formula for calculating a true labor cost + benefits equation roughly spoken if your labor cost is $28 per hour multiply that by 2 to cover benefits and taxes paid by the employer..this does not cover negotiated pension plans and 401K's that have company participation matching fund payments by the company..so it is reasonable to see that a $28.00 wage actually costs the company $56.00 per hour now add in the matching fund payments $14.00 or so per hour and you could arrive at the $70.00 per hour figure as shown in the charts. Granted you may not get those pension funds that the company put in...if they go bankrupt..but you never really got them anyway...was an illusion the unions presented to the employees so that they could justify the payment of union dues to them and to get you to vote to get them in. Also management supported this plan as well as at some future point they could use those funds in the pension plans to finance future business and not pay taxes on it ...so convenient...guess its time to pay the piper It is a sad state of affairs is that they already used the money...and now want a government hand out for bad management practices..Lee Iaccoca did not fly on a corporate jet to ask for a hand out and only took $ 1.00 pay per year as a salary until the company (Chrysler) was back on a firm financial footing maybe some belt tightening is needed...management, employees & union...otherwise you will kill of Auto manufacturing in this country. And please build something your customers will buy If the big 3 produced a viable electric vehicle and had the foresight to do so years ago maybe the off shore manufacturers would not be 7 years ahead in development and have a bigger market share, also the quality issue has been there for years and needs to be addressed. Why buy a big 3 vehicle that rattles when you drive down the street, when you can buy a Toyota, Honda or Hyundai that doesn't.

I read that the Chairman of GM said that people wouldn't buy cars from companies in bankruptcy; however, all airlines except for SWA have gone through bankruptcy over the last several years and people continued to fly on their planes. Until the big 3 wakeup they are going to be behind hte 8-ball. Also in Texas and many other areas, large SUVs are going ot be required. Also, the small cars, have higher fatalities that larger cars (SUVs). If Congress owning hte big 3 require them to make the small cars, after several families are killed by the accidents, are they going to be sued?

Listen, If you are part of the UAW it is time to reap what you have sown. The same goes for the stockholders,boards and management of the big 3. Leave me and MY tax dollars out of your mess.

Since everyone is pointing their fingers at everyone else, no one seems to see the obvious. We the people, buy at the best economic value we find. We do not care that this puts the 'Big 3' at the bottom of the pile. So don't point your fingers at everyone one else. Why are shirts cheaper in China? Because Americans would rather pay $10.00 for a pack of 10 shirts from China than to spend $15.00 for 5 American made shirts. duh. Why is the Big 3 going under? Because Americans would rather buy foreign transplant vehicles then to support their the 'Big 3'. Either buy 'Big 3' products or let the 'Big 3' die. In either case, stop pointing your fingers at everyone one else. What model car do you drive?

Auto workers must be the most overpaid unskilled workers in the country, if you can call what they do work. I live in an area where there is a GM plant and a Ford plant. The local papers/blogs are full of union employees saying they aren't making what all the news orgs., financial analysts, etc. say they are. Judging from the two living in my neighborhood (both are line workers, spouses don't work) they are making MORE than what is being reported in the media. Both live in brand new houses in the 375,000 - 400,000 range (this is the mid-west, that's expensive here). One just put in an in ground pool, and has two kids in PRIVATE colleges. From talking to them they aren't there on scholorships. I'm an IT professional with 2 college degrees and lots of additional training plus 25+ years experience, and if I had to guess I'd say I make less than both these guys. I don't know what one does, but the one with the pool and kids in private college parks cars for Ford. Yep, drives the car to the parking lot, that's it, and I'd guess he's making at least $100,000 a year for that. That is what is wrong with the auto industry.

RETIREMENT AND BENEFITS are what's killing the Big 3. Especially G.M. Please read: (While America aged : how pension debts ruined General Motors, stopped the NYC subways, bankrupted San Diego, and loom as the next financial crisis Lowenstein, Roger.) - Then you'll understand how the UNIONS (UAW) have really put the screws to these companies and why they are to blame.

Scott B is right...but not completely. Having worked at both I can assure you that this chart is half the reason and Scott has the other half. The 'other' half being poor managment. BOTH sides are equally at blame as both refused to change and update with the times. As such I can't feel sorry for their plight. I left GM for this exact reason... I saw no change to any attitudes or managment structures the entire 10 years I was there. GM, Ford, Chrysler managment are as much to blame as the UAW. Weak Leadership + UAW = Failure. It's a simple formula and one I hope we are not willing to correct without forcing these companies to restructure so they can be sucessful. Without total managment change and UAW contract change, believe me, when I tell you NOTHING will get better without it. I know we have all heard the horrible UAW stories with workers getting paid to do nothing, but let me ask you this... how can a board allow their CEO (Rick W.) to continue to run the company after continued and significant (billions) losses since '98? I defy anyone to give me any single fiscal year where he has had any success. Again... both sides are to blame.

I believe that fundamentally auto production is good for the U.S. economy, but the Big 3 need to be competetive on all fronts - product, dealer network, wages, production costs etc. The product has certainly gotten better in the last decade but the cost structure is still out of the realm of the foreign manufacturers who build in the U.S. As an eleven year resident of Detroit, and having no ties to the auto industry I am certainly an outsider with an opinion. One has to wonder and ask "why are there no auto manufacturers producing cars in the state of Michigan other than the Big 3?" Could it be the UAW? Could it be that the UAW's model is completely outdated? In what other industry is it not possible to terminate an unproductive or sub-par employee. The UAW protects its employees rather than eliminate poor performers, the UAW promotes the jobs banks, the UAW promotes "jobs for life" regardless of individual performance or capicity to perform. Congress has been negligent in its discussions with the auto manufacturers by not directly addressing the UAW and its penchant for socialism disguised as brotherhood. In order for the Big 3 to be truly competetive in todays' environment, all of their employees need to be held to the same standard, be it white collar or blue collar. All employees need to perform, all employees need to be able to be terminated or replaced without penalty or repercussion - this is the world we live in now. There is a Reason that Hyundai, Kia, Honda, Nissan, BMW, Mercedes, Toyota and soon VW all build cars in the U.S., and their is a very real reason none of them build cars in Michigan.

NO hourly autoworker makes six figures a year. Any of you who believe that are the most gullible people on Earth. In fact, the whole "$75" is an accounting myth. Unless it's a skilled trades employee, working both daily AND weekend overtime, 48 weeks out of the year, it's impossible to W2 out at the end of the year at six figures. Many of those people have continually brought up the un-cited "fact" that UAW workers get $70/hour in wages and benefits as opposed to about $40 or so for non-unionized workers at the foreign owned transplants. While the UAW and the Detroit automakers have made more than their share of mistakes and deserve a good chunk of the blame for what is happening, there is a major problem with this particular argument. IT'S NOT TRUE! UAW members do not take home $70/hour. That is the automaker's cost per active employee. What's the difference? The latter figure is total spent by automakers on wages and benefits divided by the number of active employees. The cost of benefits includes the pensions and health care costs for the hundreds of thousands of living retirees in addition to active workers. Those punching the clock every day, don't get a dime of that. As of last year, UAW workers made an average of $28/hour in wages + $10/hour in benefits. The rest went to retirees, a cost that is borne by the automakers. The reality is that unionized and non-unionized autoworkers actually make very similar wages and benefits. In fact, last year, Toyota workers in Georgetown, KY made MORE money than their UAW counterparts. See: http://www.autoblog.com/2007/01/31/toyota-workers-in-us-made-more-than-uaw-members-for-first-time-l The UAW has had such a hard time organizing the US factories of Honda, Toyota, Nissan and others, because they already make as much as their unionized counterparts. The fact is that in industries like this, companies will often tend to match the compensation offered to union workers just to keep the union out.

Yes both GM and Chrysler create military goods even today. GM is the owner of AM General, this company produces the HMVWEE (M998, M1026, M1114, M1151), and are in the market to produce the Hummer's replacement. They also help produce the MRAP. Chrysler developed and produces the M1 Abrams series of Main Battle Tanks. Ford doesnt do crap.