Now what?

[gmcbob]

Not good

http://www.reuters.com/article/newsOne/idUSTRE4B50CL20081212

[vonVeezelsnider]

Bad Things.

[Robert Hall]

Not Good. I want to see a list of which Senators voted against it.

[FAPTurbo]

GM shareholders will be going down one hell of a waterslide come tomorrow.

[smk4565]

Time to bring out the bankruptcy papers, salvage whatever they can in Chapter 11. Hopefully they can save Chevy and Cadillac at least. The cash is almost gone and there is no one left to help them. Stock price will dive tomorrow.

[smk4565]

Not Good. I want to see a list of which Senators voted against it.

http://senate.gov/legislative/LIS/roll_cal...&vote=00215

Interesting that Harry Ried voted against it.

Edited December 12, 2008 by smk4565

[cletus8269]

it starts...

[frogger]

I guess that will about do it :-(

[deftonesfan867]

Someone said something about maybe the 700b given to the banks will be used instead.

[fightingbee]

GM shareholders will be going down one hell of a waterslide come tomorrow.

Of course there is not much slide left to go down. My stash of AC oil filters in the garage are already worth more apiece than my shares are.

[balthazar]

SMK- yer link is to a vote RE H.R. 7005, the Alternative Minimum Tax Relief Act of 2008, not the autoamker bridge loan.

And there would be no 'salvaging' under Chapter 11.

[vonVeezelsnider]

Someone said something about maybe the 700b given to the banks will be used instead.

"Bush officials warned wavering GOP senators earlier Thursday that if they didn't support the legislation, the White House will likely be forced to tap the Wall Street bailout to lend them money, two Republican congressional officials told CNN."

[regfootball]

merry christmas. make no mistake, this is about busting the union.

[FUTURE_OF_GM]

merry christmas. make no mistake, this is about busting the union.

The Republicans know that the unions are a democratic stronghold...

So, instead of putting the interests of the country and you and I first, they'd rather play f*cking politics with our lives just so they can hopefully get a leg up in 4 years.

It doesn't matter how many 'little people' get screwed over in the process.

I hope the media latches onto this like a Pit Bull on a piece of meat. There is absolutely NO reason why this should not have passed.

But alas, I'm sure the media will find some way to use it against Detroit.

Let's take it nuclear!

[Intrepidation]

"Bush officials warned wavering GOP senators earlier Thursday that if they didn't support the legislation, the White House will likely be forced to tap the Wall Street bailout to lend them money, two Republican congressional officials told CNN."

If they do use money from the Wall Street bailout then this was all for show, since that was the original proposal anyway.

I love how the Republicans wanted to take a pay cut but didn't have a problem with the pork slipped into the bill to give judges a raise.

Edited December 12, 2008 by Dodgefan

[Robert Hall]

http://senate.gov/legislative/LIS/roll_cal...&vote=00215

Interesting that Harry Ried voted against it.

By the description, that's the vote list for HR7005-A bill to amend the Internal Revenue Code of 1986 to provide alternative minimum tax relief for individuals for 2008. Something unrelated.

[mustang84]

The Republican senators that voted against it should be ashamed of themselves. Congress has been reduced to a circus. The slippery slope just got steeper due to these idiots.

[avant1963]

Mitch McConnell

# Voted YES on promoting free trade with Peru. (Dec 2007)

# Voted YES on free trade agreement with Oman. (Jun 2006)

# Voted YES on implementing CAFTA for Central America free-trade. (Jul 2005)

# Voted YES on establishing free trade between US & Singapore. (Jul 2003)

# Voted YES on establishing free trade between the US and Chile. (Jul 2003)

# Voted YES on extending free trade to Andean nations. (May 2002)

"In an interview with the Louisville Courier-Journal, Senate Minority Leader Mitch McConnell (R-KY) noted that despite the economic turmoil in Detroit, Toyota plants in Kentucky are sitting pretty:

“We also have other auto manufacturers who are doing quite well,” McConnell said, naming Toyota’s Georgetown, Ky., operation. “It happens not to be American companies and that is sad. But it’s not like we don’t have success in the auto industry. We do.”

"

"It is difficult to ascertain the exact amount of tax subsidies provided to the foreign automakers because they are provided by so many localities and in different ways, including property tax breaks and corporate tax abatements. One study found that the total subsidies to foreign automakers exceeded $2 billion."

Dick Shelby

"Shelby represents the views of many members of Congress who say they oppose a taxpayer bailout and plan to join him in trying to defeat the measure. In an interview yesterday, he defended his support for tax breaks for foreign auto companies, which he praised for offering cars that the public wants. "They know what they are doing running efficient plants," said Shelby, the top Republican on the Senate Banking Committee, which held hearings on the bailout last week."

Also realize that the bill would have passed (52 votes for), but because the Republicans can't let a bill go through to a vote (basically last night was a vote for cloture, a vote to see if we should vote) without filibustering - requiring 60 yes votes to vote on a bill.

Back in 2005, the Republicans were "appalled" that the Democrats would ever think of using this "subversion to justice" but in the past two years the Republicans have used it more that any sitting Senate in history. If the RePUGS would have let it go to a real vote, it would have passed.

[Z-06]

Someone should ask Dickie Moe, which of the cars churning out of Mercedes's Tuscaloosa plant are fuel efficient? Is it ML, GL, or RL because I surely cannot find one.

[Robert Hall]

And of Shelby is from Alabama, which has a Mercedes plant, a Hyundai plant, and a I think a Honda plant now. F*cking red staters.

[BuddyP]

Not Good. I want to see a list of which Senators voted against it.

I would've been one of em.

The workers wages alone are not what is killing GM... lack of productivity and the lazy workers, both created by the UAW, are the largest blow. I will note that many GM workers are NOT lazy, but can't be productive because it would make the lazy workers "look bad".

To have to wait 30 min. for a maintanance guy to pull a stuck part out of a press that the worker could've done in a few seconds is F'in rediculous... That alone is why the UAW needs to go.

Edited December 12, 2008 by BuddyP

[hyperv6]

Well we are now looking at the President going to the "Troubled Asset Relief Fund".

[BuddyP]

Now I hear Gettlefinger is claiming he (UAW) was setup by the automakers!

[network engineer]

I would have voted nay too. The bill was a bad bill that would have did more harm than good. The bill should have provided dip financing for an approved CH11, so the automakers could have reorganized and come out profitable. This legislation would have just put a dying man on life support. Sure he's alive, but he just lays there in a coma and may never wake up.

[Robert Hall]

A buddy of mine IMed me this morning (whom I've argued with about the importance of Detroit, the quality of the Big 3 cars, etc) and asked 'So now are you going to wake up and get a Toyota?'. Argggghhhh.... I ignored him.

Edited December 12, 2008 by moltar

[smk4565]

GM's hired bankruptcy consultants, looks like that is the road they'll be taking unless the White House and Treasury can get them some money from TARP, but TARP money is set up for banks, not companies.

[balthazar]

>>"Toyota plants in Kentucky are sitting pretty: “We also have other auto manufacturers who are doing quite well,” McConnell said, naming Toyota’s Georgetown, Ky., operation. “It happens not to be American companies and that is sad. But it’s not like we don’t have success in the auto industry. We do.”"<<

No one who has a finger in determining the outcome of this issue has any sort of grasp on the situation, and that's the scariest part of it all.

Where has toyota reported the profitability/loss for an individual assembly plant ?? toyota plants are 'doing well' because they're attached to a global sales whore...oops, success story. The plants do not stand or fall on their own- they are bankrolled by the corporation, and the corp has cash. Don't GM assembly plants top the list for plant efficiency ?

Because everyone drives a car, everyone is an expert. I'll say this again- this is an extremely complex and quite emotion-driven issue, and.

I heard a 'industry analyst' on Bloomberg radio this morning. Guy was saying 'if you look at the domestic cars, they have x-amount of content from numerous foreign countries in them'... and... 'the foreign plants are doing well'. This completely ignores the fact that x-amount of AMERICAN parts are in all the FOREIGN nameplate vehicles assembled here also. None of those suppliers are going to be viable if 50% of the new car market volume dissapears. Isn't this the link between a domesic industry failure and as some have said- the foreign makes pulling out of their U.S. plants as a result ?

[thenewdamage]

Reorganization thru chapter 11 bankruptcy has worked very well for many businesses. Most notably the airlines . Why are the auto companies fighting it so much? It would give them a chance to get out from under the labor contracts that are choking them to death.

[Intrepidation]

That's Anti-American if I ever saw it.

[Drew Dowdell]

A buddy of mine IMed me this morning (whom I've argued with about the importance of Detroit, the quality of the Big 3 cars, etc) and asked 'So now are you going to wake up and get a Toyota?'. Argggghhhh.... I ignored him.

Reply: Will you be able to afford a new Toyota when you lose your job because one in 7 jobs in this country is lost, unemployment reaches 20%, and your company can no longer afford to keep you?

[Drew Dowdell]

Reply: Will you be able to afford a new Toyota when you lose your job because one in 7 jobs in this country is lost, unemployment reaches 20%, and your company can no longer afford to keep you?

Will Toyota still be able to manufacture Camrys in Kentucky when all of the suppliers it uses go under?

[regfootball]

A buddy of mine IMed me this morning (whom I've argued with about the importance of Detroit, the quality of the Big 3 cars, etc) and asked 'So now are you going to wake up and get a Toyota?'. Argggghhhh.... I ignored him.

toyota is not an example to use of a overall quality car.

[6t5frlane]

The Republicans know that the unions are a democratic stronghold...

So, instead of putting the interests of the country and you and I first, they'd rather play f*cking politics with our lives just so they can hopefully get a leg up in 4 years.

It doesn't matter how many 'little people' get screwed over in the process.

I hope the media latches onto this like a Pit Bull on a piece of meat. There is absolutely NO reason why this should not have passed.

But alas, I'm sure the media will find some way to use it against Detroit.

Let's take it nuclear!

One Senator said they were 3 letters away from getting it done. UAW. They will not renegociate their contract until it expires in 2011. As far as the Republicans are concerned the UAW has played politics with them forever. I say hunker down and get it done. There is too much at stake here.

[Robert Hall]

toyota is not an example to use of a overall quality car.

Ya, but he's a TTB (Toyota True Believer)...after driving his 93 Corolla the last 15 years and 250K+ miles, he thinks they can do no wrong..and still holds a grudge against Detroit over his '87 LeSabre that started rusting after a couple of Cleveland winters (before he moved to Colorado).

[turbo200]

we're all forgetting this bridge loan would have just tided GM over until March, when another request for $20 billion would come through. if they're gonna get all that money, then there has to be guarantees there business model will change and restructuring will happen quicker. congress should not have a say in the business model, they should only dictate that it must improve so that GM can be profitable in the next couple of years. i'm beginning to think the best way out is through bankruptcy reorganization. bush will likely use money from tarp.

by the way, the market showed us how little this had an effect on thier outlook. early morning trading, before treasury/bush talked about using tarp funds, the drop was only 100 points on news of the failure. the asian stocks seemed to have a more dire and instantaneous reaction. 100 points dwon on the Dow not so special anymore.

[smk4565]

Reply: Will you be able to afford a new Toyota when you lose your job because one in 7 jobs in this country is lost, unemployment reaches 20%, and your company can no longer afford to keep you?

3 million jobs related to the auto industry (only 250,000 of which are GM and Chrysler employees) out of 155 million jobs is 2% of the workforce, not 1 in 7 (14%). Not all those jobs would be lost because Toyota, Honda, etc would still be here and Toyota could keep any supplier it needs alive.

GM and Chrysler will probably have to lay off 1/3 or more of their workforce even with bailout money. The bailout is just delaying death, it doesn't solve the real problem of legacy costs, too many dealers, too many brands, too many models and too many medicore products that people don't want.

[gm4life]

I would've been one of em.

The workers wages alone are not what is killing GM... lack of productivity and the lazy workers, both created by the UAW, are the largest blow. I will note that many GM workers are NOT lazy, but can't be productive because it would make the lazy workers "look bad".

To have to wait 30 min. for a maintanance guy to pull a stuck part out of a press that the worker could've done in a few seconds is F'in rediculous... That alone is why the UAW needs to go.

I couldn't agree more with you. You are right on the money, for those who say it was to screw the Unions you are so full of it. The Unions thought scaring the public/politicans would be enough to pass it so they would only have to change a few things, no no the Union needs to change alot of things. The Union is the one screwing GM, they need to become cost competitive at the start of 2009 or else it is the end, not just wages but legacy and all other costs. Or your right GM is going under. Seriously. But that won't happen, Forbes was saying they can come back and stronger than ever this was a great first step. I want GM to get money but the UAW needed to agree to have the same health care plans and wages as non-Union workers at other American plants. It is that simple then GM can make money and have more money to develope better products. Sorry I want them to have money only if the Union and GM execs adjust the Union especially wasn't ready to do that. So good for them I am glad to see one of my reps actually represented me.

I repeat it wasn't about screwing the Unions it was about getting the Unions to agree to actually compete with Toyota/Honda/Benz/BMW etc. on wages/perks so GM can make money and start now. That is why the republicans voted it down. I am glad they did it will be better for GM in the long term. I understand why so many are upset but they need to file chapter 11 and this only prolonged that. If you want to see a stronger GM maybe not tomorrow but around in another 100 years oposing it was the right thing to do. It was a Union bailout plain and simple.

[gm4life]

3 million jobs related to the auto industry (only 250,000 of which are GM and Chrysler employees) out of 155 million jobs is 2% of the workforce, not 1 in 7 (14%). Not all those jobs would be lost because Toyota, Honda, etc would still be here and Toyota could keep any supplier it needs alive.

GM and Chrysler will probably have to lay off 1/3 or more of their workforce even with bailout money. The bailout is just delaying death, it doesn't solve the real problem of legacy costs, too many dealers, too many brands, too many models and too many medicore products that people don't want.

Oddly enough I find myself agreeing with SMK... Scary but your right on as well.

[gm4life]

we're all forgetting this bridge loan would have just tided GM over until March, when another request for $20 billion would come through. if they're gonna get all that money, then there has to be guarantees there business model will change and restructuring will happen quicker. congress should not have a say in the business model, they should only dictate that it must improve so that GM can be profitable in the next couple of years. i'm beginning to think the best way out is through bankruptcy reorganization. bush will likely use money from tarp.

by the way, the market showed us how little this had an effect on thier outlook. early morning trading, before treasury/bush talked about using tarp funds, the drop was only 100 points on news of the failure. the asian stocks seemed to have a more dire and instantaneous reaction. 100 points dwon on the Dow not so special anymore.

[gm4life]

GM gave in to the UAW too much and the UAW asked for too much and they don't have 50 percent market like they did when they could pay great wages and health care packages they once did. The UAW has been in a fantasy world for nearly 20 years and they need to get a taste of the real world. Lower wages and less perks just like the execs should as well. I like the fact they want to help the industy but loans should be given no strings attached and they should get rid of CAFE let the market decide what they want not the Goverment. The Goverment also practiced bad trade policy, I think the republicans have a good plan and this another example of Bush letting down the more conservative folks. Oh but wait isn't goverment the answer to our problems, many believe that but I don't. I don't want a car czar or a bunch of "green strings" attached. I support the loans only with no strings attached, if not go with what the republicans proposed or go into chapter 11 like everyother company because long term that is best for GM. I can't believe how ignorant some people sound that the republicans actually want to screw the American car compaines... No they want them to live, and not to have to keep asking for goverment money. I would advise you to actually think why any political figure dem or repub would want to hurt America? I just want the GOVERMENT TO STOP solving my problems, telling me what kind of car to drive and let the FREE market decide. Obama is a big Union boy and will give 'em the money fact is it will prolong the process and they will still need to file chapter 11. I can see it now all of you liberal car people rooting for the money and the car czar saying no Challenger, no Charger, no G8 GXP, no Camaro, Mustang GT, and Corvette. Then telling them to build all bland Prius/Camry wanta-be's. Just wait they'll get the money not make enough changes still need to file for chapter 11 and in addition have to build a bunch of wussy ass econ/liberal green cars.

^This was posted by me in another thread, it applies perfectly here as well... Many might not like to hear it but I think its the truth...^

Just too add as well the Unions need to get the same wages and perks/healthcare as the forigen compaines in America, by the start of 2009 or very soon or it may be the end. Fear not that won't happen they will figure it out and become cost competitive but the more control we give the goverment the less fun cars GM will be able to build. The Union didn't clearly want to give enough so the democrats made it sound like the republicans were just screwing the Union, not true the republicans want GM/Ford/Chrysler to be sucessful but without goverment help or addition goverment mandates that never work like CAFE. The Union is the one screwing GM and the GM is letting the Union screw them. There is blame on both sides so GM better get its execs in line with small pay checks and less perks and especially the Union and this needs to happen now. The sooner it happens to sooner and more likely we will see a stronger and healthier GM. The money sounded good but when you read behind the minimal changes the Unions were willing to make it was apparent it was a bailout for the Unions that have been out of touch with the country for nearly 20 years. Sorry, I flipped back and forth on this one and the more and more I read the more I opposed it. This plan would have only helped the Union out for a little while along with GM and then they would still need file chapter 11 and the Union woudl still need to get real with resonable perks/healthcare aka becoming cost competitive same thing with all those damn legacy costs. Don't be fooled for those of you who can't see past a few billion dollars then I am sorry but you weren't looking at what really has been going on at GM for the past 20 years. When the Japan Inc. came in and made decent cars (ugly and slow yes) but for less money with decent quality while GM was over paying workers and giving out nice perks, and not sinking money into product. (Like the should have been.) So the Toyota/Honda wouldn't be ass whomping them sales wise today, today the problem is not the products GM has which are pretty good it is the Unions deals/Exec perks. THAT IS A FACT.

Edited December 12, 2008 by gm4life

[CARBIZ]

Reorganization thru chapter 11 bankruptcy has worked very well for many businesses. Most notably the airlines . Why are the auto companies fighting it so much? It would give them a chance to get out from under the labor contracts that are choking them to death.

There is a big difference between an airline going under and a multi-national automaker. If you fly AA and they go under, at most you are out a ticket. The fear for many is that if they buy a GM car right now they will not be able to get parts in 6 months and/or their warranty will be worthless. (See Daewoo a few years ago.)

Anyone with SENSE knows this will not happen. First of all, even if GM completely vanished into a black hole tomorrow, with the tens of millions of GM vehicles on the road, parts will be easily accessible for many years to come. Secondly, if GM is forced into Chapter 11, it will be to shove off the excess (read: pain in the ass) dealers and UAW/CAW. It would not be a payday for the shareholders, either - but then they've already lost their shirts. The bankruptcy team (and trustees) would ensure that the parts suppliers and end-customers were taken care of. WE KNOW THAT. However, Mr. and Mrs. Joe Q Public does not.

At this point, part of me wants to see a bankruptcy; however, due to the sheer size of GM and the myriad of companies it owns/controls, a quick emergence from protection would not be assured, yet that would be an absolute necessity. Many bankruptcy proceedings drag on for a year or more. (See: Delphi.) This more than anything cannot be allowed to happen. Plus, if more assets are forced to be sold (ie., Opel, GM Canada, or whatever) the company will emerge weaker, not stronger.

Make no mistake: IT IS THIS UNCERTAINTY THAT IS HURTING GM RIGHT NOW, NOT ANY LACK OF BUSINESS PLAN OR POOR PRODUCT. People want to buy GM, but they are scared - unreasonably so, but scared nonetheless.

[vonVeezelsnider]

There is a big difference between an airline going under and a multi-national automaker. If you fly AA and they go under, at most you are out a ticket.

Funny I was just thinking of this comparo yesterday. The other thing is that in the United States there isn't like three mega airlines with fleets of 2000+ Aircraft that are intertwined with the economy. Rather than having GM, Ford, and Chrysler you have AA, United, US Airways, Southwest, Jetblue, Frontier, Spirit, USA3000, Delta-Northwest, Continental, Alaska-Horizon, AirTran and smaller outfits that I just don't remember right now. If one cuts the slack there's lots of American airlines to pick up the slack on domestic air travel... however there is no such guarantee that Ford would simply 'get' GM and Chrysler's former customers.

[Z-06]

What is an important tit bit is that GMNA had actually made profit in second quarter of 2007 after heavy restructuring. It is the third quarter when they adjusted their 38 billion in deffered tax (around same time when negotiations with UAW went through) and after that the weak economy started hurting the operations. Before the first quarter of 2007 (Net income of 78 million), the GMNA had losses in 100 millions if not more.

The point is that people who think GM needs more restructuring is not whole heartedly correct. If 40% of your sales tank of course your bottom line will take a tremendous hit and given the cut throat competition, you will see staggering losses. Not one high volume manufacturer expected this around the globe, and GM is not an exception.

Call it chess, call it destiny, it seems like both congress and the automakers want to end the autoworker legacy. A desperate time is the best time to do so. As has been the case with the administration, they have not been entirely honest with what they want to accomplish (read Iraq), same applies to this current bailout scenario.

[haypops]

Interesting that Harry Ried voted against it.

Four Democrats voted against it (Baucus, Lincoln, Tester, and Reid, who opposed it so he could procedurally bring up the bill again).

from NBC's first read

[haypops]

, but TARP money is set up for banks, not companies.

The WSJ says that is not at all true. Paulson insisted on total freedom of use of th efunds and the restriction congress made wa to the amount.

[Chicagoland]

Ford has a big plant in KY for the Explorers, and it is being retooled for smaller cars. So, Toyota isnt the only plant there.

[haypops]

I repeat it wasn't about screwing the Unions it was about getting the Unions to agree to actually compete with Toyota/Honda/Benz/BMW etc. on wages/perks so GM can make money and start now. That is why the republicans voted it down.

Neither the Republicans or Democrats involved agree with you on that statement.

GOP Leader Mitch McConnell said, "and it is upon that issue that we've reached an impasse." Democratic Banking Committee Chairman Chris Dodd agreed, saying: "There was no debate from the United Auto Workers or anyone else that we ought to achieve parity in the wages and benefits. The question was the timing of it."

http://www.FirstRead.MSNBC.com !

[FUTURE_OF_GM]

we're all forgetting this bridge loan would have just tided GM over until March, when another request for $20 billion would come through. if they're gonna get all that money, then there has to be guarantees there business model will change and restructuring will happen quicker. congress should not have a say in the business model, they should only dictate that it must improve so that GM can be profitable in the next couple of years. i'm beginning to think the best way out is through bankruptcy reorganization. bush will likely use money from tarp.

by the way, the market showed us how little this had an effect on thier outlook. early morning trading, before treasury/bush talked about using tarp funds, the drop was only 100 points on news of the failure. the asian stocks seemed to have a more dire and instantaneous reaction. 100 points dwon on the Dow not so special anymore.

The "MARKET" won't be unemployed by a collapse of the auto industry...

It amazes me how shortsighted most people are these days.

[FUTURE_OF_GM]

3 million jobs related to the auto industry (only 250,000 of which are GM and Chrysler employees) out of 155 million jobs is 2% of the workforce, not 1 in 7 (14%). Not all those jobs would be lost because Toyota, Honda, etc would still be here and Toyota could keep any supplier it needs alive.

With a 45% drop in sales each month? Yeah, I bet...

GM and Chrysler will probably have to lay off 1/3 or more of their workforce even with bailout money. The bailout is just delaying death,

The restructuring was already working. Had the economy NOT tanked, GM and Chrysler would've been fine.

it doesn't solve the real problem

The problem was already solved.

of legacy costs,

Can't get out of that, even with bankruptcy.

too many dealers, too many brands,

Both outlined and (being) fixed with the plan unveiled in 2005.

too many models and too many medicore products that people don't want.

Not factual.

[fightingbee]

Dick Shelby

"Shelby represents the views of many members of Congress who say they oppose a taxpayer bailout and plan to join him in trying to defeat the measure. In an interview yesterday, he defended his support for tax breaks for foreign auto companies, which he praised for offering cars that the public wants.

Yes, Dick Shelby from AL, the state where you can see dirt poor people having to pay 8% sales tax on their groceries while at the same time the state government gives any foreign corporation any kind of tax incentive/giveaways they can. It has brought some jobs to AL, but not anything that pays all that great.

Edited December 13, 2008 by fightingbee