Ford owes $23 Billion to The Banks Sales Down 16%

Everyone applauded Ford for not taking any Government loans.....

Well it's because months before the calapse they mortgaged the entire company for $23Billion dollars.

Now Ford has 3 Times the Debt of GM/Chrysler, no wage concessions from the UAW and Sales down 15.9% from last year. (it's worst year in 40 Years)

They are pinning there hopes on the New Focus and Festiva. Which are not bad, but they are a Focus and Festiva, you've already done that.

The Fusion, Taurus, Escape, lack emotion in design and already appear dated.

The Mustang is still a favorite and makes a nice rent-a-car.

Even the Ford flagship F150 is dated and weak compared to the GM Sierra and Dodge Ram trucks.

Well at least they have the Ford Transit.....Joke

read more...

Big 3 sales fade as 'clunkers' wraps up

Low inventories cited in sinking U.S. share of incentive program

David Shepardson / Detroit News Washington Bureau

Washington -- The Detroit Three automakers' share of "cash for clunkers" sales fell sharply, compared to foreign nameplates, in the final week of the $3 billion incentive program.

General Motors Co., Ford Motor Co. and Chrysler Group LLC sold 38.6 percent, or about 266,000 of the nearly 700,000 clunker replacements. That's far below their combined 45.3 percent share of 2009 auto sales.

The U.S.-based companies said they were hampered by a comparative shortage of small, fuel-efficient vehicles that buyers were seeking and that the Asian automakers provided....Freep--More

read more...

Will Obama's Auto Task Force Merge GM and Chrysler?

More talks of the GM and Chrysler Merger. When Chrysler submitted it's viability plan on Tue. 2/17/09 they suggested the best thing for Chrysler was to merge with GM.

GM and Chrysler have talked of working together for years and in November 07 the talks of full blown merger heated up.

Well they are at it again, now the question is "Will the Auto Task Force merge the two companies"?

If this goes down you will know it was all contrived months ago!!!

read more...

Auto Rescue: Bush to Give Low-Interest Loans to Carmakers

The White House has decided to come to the rescue of General Motors and Chrysler by providing them with $17.4 billion in low-interest loans to keep them afloat, ABC News has learned.

The money for the loans will come from the Troubled Asset Relief Program fund, signed into law this fall to bail out the financial industry. The president will provide $13.4 billion in short-term financing in December and January and plans to make another $4 billion available in February, provided it can reach into the second half of the $700 billion TARP fund to do so.

The deal also includes as a non-binding "target" a key provisions, including making work rules and wages competitive with workers at foreign car companies in the U.S.

Chrysler CEO Bob Nardelli issued a statement saying the company was grateful for the helping hand and that, "Chrysler is committed to meeting these requirements."

Pressure had been building for President Bush to act. Chrysler temporarily shut down all of its plants earlier this week to save money, and GM delayed construction on a new plant for the same reason. And House Speaker Nancy Pelosi urged Bush on Thursday to make a decision because the nation's weakened economy could not risk a massive wave of layoffs.

"This is a difficult time for a free-market person," Bush said Thursday. "Under ordinary circumstances, failed entities, failing entities should be allowed to fail. I have concluded these are not ordinary circumstances, for a lot of reasons... We got to the point where if a major institution were to fail, there is great likelihood that there'd be a ripple effect throughout the world, and the average person would be really hurt."

Treasury Secretary Henry Paulson told a business forum in New York Thursday night it was too risky to simply let the automakers fail.

"When you look at the size of this industry and look at all those that it touches in terms of suppliers and dealers… it would seem to be an imprudent risk to take," he said....More

read more...

Is the Auto Rescue Loans In Limbo?

WASHINGTON (AP) — Conservative Republicans admonished the White House Tuesday not to use bank-bailout billions to rescue distressed U.S. automakers, and a key Democrat demanded the government get veto power over the companies' business decisions as a condition of any aid.

The Bush administration said it was still evaluating options and suggested any deal would require major concessions by all sides. Complicating its task, lawmakers in both parties — having failed in their efforts to push a $14 billion auto rescue through a bailout-weary Congress — were pressing for an array of terms and conditions they said should be part of any Plan B.

"We are not going to be rushed into it," presidential press secretary Dana Perino declared.

Only a day earlier, President George W. Bush suggested that a rescue package would come sooner rather than later. "An abrupt bankruptcy for autos could be devastating for the economy," Bush said on Monday. "This will not be a long process because of the economic fragility of the autos."

Still, conservative Republican lawmakers, many from Southern states that are home to Japanese auto plants, wrote to Bush asking him not to use one of the most readily available pots of money — the $700 billion Wall Street rescue fund — to help the U.S. carmakers.

And the White House and Treasury Department were in talks with Sen. Bob Corker, R-Tenn., who has been pressing for big union concessions in exchange for rescue money, on the terms and structure of a possible bailout, said a senior GOP congressional aide.

Corker came close last week to striking a deal with the United Auto Workers union for a $14 billion bill that would have forced the carmakers to bring their wages and benefits in line with those of Japanese auto companies in the U.S. by a specific date in 2009. The measure collapsed after the UAW refused to agree to wage cuts that quickly. The new contacts with the administration were disclosed on condition of anonymity because the aide was not authorized to divulge them.

Rep. Barney Frank, D-Mass. weighed in as well, urging Treasury Secretary Henry Paulson to adopt the accountability provisions included in a House-passed auto bailout bill — the product of a deal with the White House — as a condition of any bridge loans to U.S. automakers. That measure would have given a Bush-appointed overseer say-so over any major business decisions by the automakers while they were taking advantage of federal aid, including the power to nix any transaction of $100 million or more.

"Given the serious mistakes that senior auto industry executives acknowledge they have made in the past, such safeguards are absolutely necessary to ensure that taxpayers are protected and that the retooling of this critical industry proceeds as quickly as possible," Frank wrote to Paulson on Tuesday.

GM and Chrysler have said they will run out of cash within weeks if they don't get help. Ford Motor Co. has said it has enough cash to survive 2009.

Perino said the administration was still working on details of the package, which could reach $15 billion for General Motors Corp. and Chrysler LLC.

She said concessions had to be made in exchange for the money.

"I don't think that there's any possible way that this president would agree to allow taxpayer financing to go toward firms that are not willing to make tough decisions to become viable and competitive in the future," she said.

Bush said Tuesday that his administration was "considering all options" for helping the automakers, arguing that the already distressed economy could slide further into recession without prompt action.

"What you don't want to do is spend a lot of taxpayers' money and then have the same old stuff happen again and again and again," Bush told CNN in an interview. At the same time, he said, "we're trying to get this done in an expeditious way."

The administration indicated it would extend a helping hand to the domestic automakers after an aid effort died in Congress late last week. The White House had wanted Congress to act.

The timing and details of Plan B — the Bush administration stepping in to help the automakers directly — remain in flux. In the absence of action, lawmakers were eagerly offering up their counsel, particularly on the idea of using the $700 billion financial industry rescue fund, known as the Troubled Asset Relief Program, to help U.S. automakers.

"Congress never voted for a federal bailout of the automobile industry, and the only way for TARP funds to be diverted to domestic automakers is with explicit congressional approval," wrote 26 GOP lawmakers, led by Rep. Jeb Hensarling of Texas.

Seven Senate Republicans led by Sen. Jim DeMint of South Carolina fired off a similar missive saying that without restructuring, "we do not believe any amount of money will succeed in saving these companies."...More

read more...

US senators grill auto CEOs, GM-Chrysler deal eyed

US senators grill auto CEOs, GM-Chrysler deal eyed

* GM-Chrysler merger talks could restart
* Senior Democrats urge Bush to act using financial fund
* CEOs to appear before House committee Friday
* Fed to write Dodd about emergency loan power - source
* GM shares end down 16 pct, Ford closes 6.7 pct lower

By John Crawley and Kevin Drawbaugh

WASHINGTON, Dec 4 (Reuters) - The chief executives of General Motors Corp and Chrysler LLC said they would consider restarting merger talks if needed to win their slice of up to $34 billion in emergency U.S. government aid.
"I would be very willing to look at it seriously," GM CEO Rick Wagoner told the Senate Banking Committee on Thursday, adding that merger talks earlier this year were dropped on concerns GM did not have the financing to merge with Chrysler.
Chrysler CEO Robert Nardelli said his job would likely be the first to go in a merger with GM, but if that would save Chrysler and its workers "I would do it."
Leaving their corporate jets in Detroit and driving to Washington, the chiefs of the Big Three automakers, including Ford Motor Co CEO Alan Mulally, pledged to refocus on higher fuel efficiency vehicles and lower production costs.
But they encountered deep skepticism among lawmakers who are suspicious of such promises, given the companies' past failures to ween themselves from gasoline guzzlers and to make innovative cars that consumers want to buy.
"I don't trust the car companies' leadership," said New York Democratic Sen. Charles Schumer at the hearing.

But in a comment reflecting many lawmakers' sentiments, he added, "We can't let the industry fail."

Most lawmakers want to help Detroit, but existing bailout proposals are stuck in a political gridlock between administrations, with President George W. Bush a lame duck, and President-elect Barack Obama waiting to be sworn in Jan. 20.
Underscoring the difficulty of getting an aid measure quickly through Congress, Senate Majority Leader Harry Reid, House Speaker Nancy Pelosi, Senate Banking Committee Chairman Chris Dodd and House Financial Services Committee Chairman Barney Frank sent a letter to Bush on Thursday urging him to use the $700 billion bank bailout program to help Detroit.
The administration has said that program is for helping the financial industry, but the four Democrats argued in their letter that it was becoming clear a failure of the auto companies would have a big impact on the financial sector.
Meanwhile, no congressional action on aid is expected before next week and perhaps not even then, despite dire warnings GM could collapse by the end of December without aid.
"Congress may consider legislation to provide assistance to the domestic automobile industry next week," said the letter to Bush.
The auto CEOs will appear before House Financial Services Committee on Friday.
DEATH SENTENCE

"Nothing concentrates the mind like a death sentence and we're looking at a death sentence if we don't respond intelligently and prudently," said Dodd at the end of a nearly six-hour hearing. "We're not going to leave town without trying."
Other lawmakers and the White House have called for modifying a $25-billion Energy Department program meant to assist automakers in developing technology to meet new fuel-efficiency requirements as a path to quick cash.
The Federal Reserve could also make a loan to automakers in some circumstances.
The Fed is expected to send a letter to Dodd on Friday explaining how it must obtain sufficient collateral under law to make any emergency loans, a source familiar with the letter told Reuters on Thursday.

Shares of both GM and Ford closed lower in a day of broadly bearish trading as Detroit's once mighty Big Three again came hat in hand to Washington. The same CEOs failed to secure help two weeks ago in an earlier round of congressional hearings.
This time the executives did not fly in on the jets that drew sharp criticism on their last visit. ID:nN04413085
GM's Wagoner arrived at the Capitol building in a light blue Chevrolet Volt electric prototype, but drove most of the way from Detroit in a Chevrolet Malibu Hybrid. Mulally came in a white Ford Escape Hybrid, and Chrysler's Nardelli arrived in a white EV electric vehicle.
The CEOs warned Congress again that a steep slump in car sales and sluggish world credit markets are threatening their futures and millions of good-paying jobs.
The GM-Chrysler merger idea was pressed by Utah Republican Sen. Robert Bennett and Tennessee Republican Sen. Bob Corker.
"I'd like to see that happen," Corker said. "I hope that's an outcome... our country cannot really deal with three separate automakers."
But United Auto Workers President Ron Gettelfinger questioned claims of cost savings from a merger and told the committee such a deal would bring "unbelievable" job losses.
BAILOUT COULD GROW

GM wants $4 billion and Chrysler $7 billion by year's end. GM also wants another $8 billion in early 2009 and a $6 billion line of credit if its cash position erodes further. Ford says it has enough funds now but wants a $9 billion line of credit.
An economist told the committee that the estimated $34 billion overall cost of the bailout cost could rise. Two weeks ago, the automakers had estimated they needed $25 billion.

The industry may need $75 billion to $125 billion to avoid bankruptcy and the companies may well return asking for more money later if they get the $34 billion they want now, said Mark Zandi, chief economist of Moody's Economy.com.

"I'm skeptical, doubtful that it's going to end at $34 billion," Zandi said.
On a combined basis, sales by the three automakers plunged 40 percent in November. The economy, already a year into recession, would suffer "severe and sweeping" damage if one or more of the automakers failed, Dodd said.

But Alabama Sen. Richard Shelby, the top Republican on the committee, voiced doubts shared by some senators on whether taxpayer funds are well-spent helping struggling businesses.

Shelby opposed the $700-billion bailout of Wall Street and the banks and "applying the same standard, I intend to oppose bailing out the Big Three auto manufacturers," he said.
WHITE HOUSE RESERVING JUDGMENT

The three companies submitted plans to Congress on Tuesday intended to show that they can still be viable businesses.

The White House said on Thursday it was too early to judge the viability plans and that the administration wanted to hear the testimony to Congress first. ID:nN04530567
In the hearing, the CEOs said they would accept some sort of oversight board as a condition of a bailout.

All three automakers dismiss filing for bankruptcy protection, but some lawmakers are exploring the possibility of conditioning federal aid on an speedy court restructuring of one or more of the Detroit manufacturers.

The head of the Government Accountability Office (GAO), the investigative arm of Congress, said Congress could consider a two-step approach with an immediate cash infusion to avert any collapse, followed by a program for distributing more loans over time based on certain criteria being met.

Gene Dodaro, acting GAO comptroller general, also said the Bush administration has legal authority to use money from its bank rescue program to help Detroit.
Shares of GM closed regular trading Thursday down 16.1 percent at $4.11, while Ford ended 6.7 percent lower at $2.66, both on the New York Stock Exchange. (Reporting by John Crawley, Karey Wutkowski and Rachelle Younglai in Washington, with Kevin Krolicki and David Bailey in Detroit. Writing by Kevin Drawbaugh; Editing by Tim Dobbyn)

read more...