Daniela Maurer's List: Essay2

• Too much emphasis on trucks and SUVs; poor quality; and failure to respond to  the growing consumer demand for fuel efficiency.
• the three private jets
• Car and light-truck sales at GM and Chrysler — both of which received  low-interest bridge loans — were down 23 and 30 percent, respectively, last year
• In January, the Italian car company Fiat agreed to acquire a 35 percent stake in  Chrysler, which Chrysler Chairman Robert L. Nardelli said would enable the  automaker to offer a broader lineup of vehicles while adhering to conditions of  the federal bailout.
• “The tough times are hitting us far faster, wider and deeper than expected,”  said Katsuaki Watanabe, the outgoing president of Toyota Motor Corp., which  projected its first operating loss in 70 years.
• We made mistakes,” GM's Wagoner told the Senate Banking Committee, citing a  failure to make the company's operations more flexible and move faster into the  U.S. market for smaller, more fuel-efficient vehicles. In a trade  journal ad, GM apologized for violating Americans' trust by, among other things,  letting quality lag behind industry standards and designs to become  “lackluster,” skewing its product mix toward trucks and SUVs and agreeing to  “unsustainable” employee-compensation plans.
• industry could eliminate up to 3.3 million American jobs
• I have little sympathy for the bonus rank of the Detroit Three,” he said in  November as Detroit executives began to appeal for federal aid. “There are  plenty of hungry managers around. If someone thinks life is impossible without  all the perks, then let them hunt for an employer in some other industry who  will provide them.”
• the UAW is responsible
• negotiate contracts locking Detroit into huge benefit costs, he says the union  “is not the decisive source” of the domestic automakers' trouble. “The main  problem is they are not building cars consumers want to buy
• The UAW says the figure includes not only health care, pension and other  compensation for current workers but also benefits for retirees that are spread  across the active work force. “Active workers never receive any of this  compensation in any form, so it is not accurate to describe it as part of their  'earnings,' ” the union argues.

• GM has 96,000 active U.S. employees and 497,000 retired workers,  compared with only 300 retired workers in the United States for Toyota,  according to The Wall Street Journal, which called GM “one of the  largest providers of health-care coverage in the world.” It added, “Including  the dependents of retired workers who are covered by GM, the automaker provides  health care for almost one million people.”

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• To start with, let's require the U.S. automakers to come up with a blueprint for  a 100-mile-per-gallon car.
• It would be hugely catastrophic if Detroit went under," said Ehrlich, 60. "Some  level of assistance would be helpful."
  
  
• Many of us are deeply concerned that millions of workers would lose their jobs  if General Motors, Ford and/or Chrysler collapsed.
  
  
• The credit crunch and slumping economy have depressed U.S. auto sales to levels  not seen in about two decades. Once-mighty GM says it could run out of cash by  next summer. Ford
• Though a number of people I spoke with said they'd reluctantly support a bailout  of Detroit rather than see the companies disappear, most said this would be  rewarding failure after decades of mismanagement and poor decision making
• $2,000 tax credit for buying an American car -- an incentive that he said  wouldn't get him to trade in his beloved sports car but might prompt him to  replace the Audi that now serves as his family car.
  

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• General Motors has been saying for months that bankruptcy is not an option and  in fact, not even a possibility. Of course most of us knew they were lying, but  now they appear to be on the brink of finally admitting that...If GM is going to  file for bankruptcy eventually -- which it is -- the sooner the better. With the  size of the company's debt load, every day that goes by without a filing is cash  out the door."

• To be honest, though, this time around the government should be savvier and  demand fair compensation and the lion’s share of the benefits for providing this  funding. If the auto companies really need the money they will have no choice  but to accept the government’s terms
• Instead, Detroit focused on building SUVs and trucks with larger profit margins
• Sell assets (these include, say, General Motors‘ Hummer, SAAB  and even the allegedly untouchable Cadillac brands)
  - Conduct a rights  offering to raise equity
  - Drop some advertising and a Nascar sponsorship or  two
  - Reduce and defer your health care financing agreements (the voluntary  employee benefits association, or VEBA) with the unions
  - Cut more costs,  including wages and benefits for union members
  - Raise more debt on  assets
  - End bad dealer relationships
  - Simply sell more cars.
• Let’s face it. We are past the days when the Detroit Three were necessary to the  U.S. economy, if that day even existed. The Detroit Three employ about 350,000  and that number is going down

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