Post Number: 255
|Posted on Sunday, March 08, 2009 - 10:07 pm: || |
http://www.bloomberg.com/apps/ news?pid=20601087&sid=aK2UA6jk tv6s&refer=home
By Jeff Green and John Hughes
March 8 (Bloomberg) -- President Barack Obama’s auto task force comes to Detroit tomorrow amid Republican calls to let General Motors Corp. go bankrupt and waning public support for giving automakers taxpayer loans they say they need to survive.
U.S. Senator John McCain of Arizona, Senator Richard Shelby, the top-ranking Republican on the Banking Committee, and House Minority Leader John Boehner spoke today against $21.6 billion in new aid to keep GM and Chrysler LLC afloat. GM’s approval rating fell to 32 percent, according to a Rasmussen Reports poll.
GM twice last week reiterated its opposition to bankruptcy and confirmed that position today as $82 billion in losses since the end of 2004 and auditors lack of confidence in its current viability add fuel to the speculation that only Chapter 11 will fix its troubles.
“The best thing that could probably happen to General Motors, in my view, is they go into Chapter 11,” McCain said today on the “Fox News Sunday” program.
Members of the Obama task force that advise on future U.S. Treasury loans are scheduled to visit GM’s Technical Center, including a test-drive of GM’s Volt electric car, and tour a Chrysler pickup factory in Warren, Michigan. They also will meet with executives and United Auto Workers union President Ron Gettelfinger, according to an administration official, who asked not to be named because the plans are private.
Obama’s chief auto advisers, Ronald Bloom, a former United Steelworkers union adviser and previously a vice president at Lazard Ltd., and Steven Rattner, co-founder of private-equity firm Quadrangle Group LLC, will be among the participants, the official said.
The U.S. Treasury agreed to fund a bailout Dec. 19 using the Troubled Asset Relief Program originally established to rescue ailing banks.
Among American adults, 32 percent now have a favorable opinion of GM, according to a Rasmussen report of 1,000 adults taken March 5-6 and released today. That’s down from 69 percent two years ago, the survey company said on its Web site. About 64 percent of Americans oppose additional loans, an earlier Rasmussen survey found.
GM is cutting executive pay and will eliminate 47,000 jobs this year, drop U.S. brands and close plants as part of a restructuring required to keep $13.4 billion in U.S. loans. Chrysler, which is owned by Cerberus Capital Management LP, is cutting 35,000 jobs, sold $1 billion in assets and is shedding models to keep $4 billion and solicit $5 billion more.
The Canadian Auto Workers union said today it reached a tentative agreement with GM to freeze wages and pensions until 2012 and to require workers and retirees to pay a monthly health- care fee to reduce the automaker’s costs. UAW workers already agreed to pay freezes and other concessions that haven’t been ratified as they discuss changes in a retiree health fund.
The Obama task force trip tomorrow follows two weeks of meetings with auto executives, suppliers, analysts and others as it reviews the two carmakers’ plans to keep $17.4 billion in loans and borrow more.
“I’m glad they are going,” U.S. Senator Carl Levin, a Michigan Democrat, said in a statement last week. “What they will see is a highly modernized auto industry that can compete with the rest of the world if we do what the governments of the rest of the auto-producing countries in the world are doing.”
GM and Chrysler executives met with the committee two weeks ago in Washington to discuss progress and the task force also held talks with the UAW, bondholders, dealers and Fiat SpA, which is proposing taking a 35 percent stake in Chrysler to help it survive if it gets new U.S. loans. Auto-parts makers also are seeking as much as $18.5 billion in support.
Shelby said today on ABC’s “This Week” program that “subsidization of anything for very long never works. I’ve suggested they go into Chapter 11. That’s where they belong. And they could reorganize.”
Boehner said on CBS’s “Face the Nation” program that the government shouldn’t give GM any more money until GM proves it can be viable.
GM said Feb. 17 that bankruptcy, even with government support, will be more expensive than a U.S.-funded restructuring outside of court and reiterated that position in statements and interviews March 5 and 6. Chrysler has the same position.
“As we’ve demonstrated through a series of actions, GM is moving quickly and aggressively to restructure the business, and achieving that outside of court remains the best solution for GM and its constituents,” spokeswoman Renee Rashid-Merem said in a March 6 interview. She reiterated that position today.
The cost of a bailout may be rising after industrywide car sales fell to the lowest level since 1981 last month. Unemployment in Michigan rose to 11.6 percent in January, the highest in 25 years and the worst in the nation.
To contact the reporters on this story: Jeff Green in Southfield, Michigan, at firstname.lastname@example.org; John Hughes in Washington at email@example.com.
Last Updated: March 8, 2009 20:05 EDT
Post Number: 2823
|Posted on Monday, March 09, 2009 - 3:14 pm: || |
The only reason the shit-heel repubs are wanting GM to falter is so that their Japanese transplants in the lower states can gain even more marketshare.
The same Japanese transplants that are getting a lot of money from the Japanese gov't and from HUGE tax breaks form the southern states.
Isn't partisan politics great!
Post Number: 1298
|Posted on Monday, March 09, 2009 - 3:40 pm: || |
The Republicans just want to break the UAW up, and see this as a way to do that.
Post Number: 258
|Posted on Monday, March 09, 2009 - 4:04 pm: || |
http://www.marketwatch.com/new s/story/union-ratifies-deal-ch ange-labor/story.aspx?guid=%7B 49EE5CAE%2D8F37%2D47EC%2D8838% 2D28867875DA54%7D&siteid=yhoof
Union ratifies deal to change labor contract
SAN FRANCISCO (MarketWatch) -- The United Auto Workers union said Monday that is has approved changes to the way Ford Motor Co. pays into its health-care fund as well as modifications to the labor deal it made with the automaker back in 2007.
Under the terms of the deal announced last month, Ford, which owes more than $13 billion to the fund (VEBA), will be able to use equity to fund up to 50% of its payments instead of cash.
According to the UAW, 59% of production workers and 58% of skilled-trades workers across the U.S. voted to ratify the agreement.
"Once again UAW members have stepped up to make the difficult decisions necessary to deal with the reality of the current economy, the deteriorating auto industry as a whole and specifically the negative impact the economic climate is having on Ford Motor Co.," UAW President Ron Gettelfinger said in a statement.
The deal will likely serve as a blueprint for rivals General Motors Corp and Chrysler LLC as both companies work to secure further federal funding and stay out of bankruptcy. President Barack Obama's auto task force went to Detroit Monday to meet with executives from GM and Chrysler as well as from the United Auto Workers.
The two domestic automakers, which already have received $17.4 billion, have asked the Treasury for a total of up to $39 billion in low-cost loans. GM and Chrysler, as part of their loan agreements, are required to get the union to accept equity payments in lieu of cash to fund the health-care trust. GM owes about $20 billion to its VEBA.
Ford, which lost a worst-ever $14.6 billion last year, has yet to tap the government for aid and repeatedly has stated its intention of making it through the brutal climate for the auto industry without help from taxpayers.
Ford shares bucked a broader market downturn to register a 2.9% gain to $1.75. GM's stock jumped almost 16% to $1.68, bouncing back from 75-year lows hit last week.