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Post by Tim Collins on Dec 18, 2008 6:05:49 GMT -7
And so it begins... Chrysler Shuts For A Month and Chevy Volt DelayedPosted by: David Kiley on December 17 Chrysler LLC said Wednesday that it will shut down all its North American production for at least one month starting December 19.Both Chrysler and GM are having to cut deeply into expenses as they await news on a government loan package from the White House. GM said today that it will delay completion of the engine factory meant to supply the Chevy Volt extended range electric vehicle the automaker hoped to have in showrooms by late 2010. The Volt has been held up as a symbol of GM’s future and its innovation. It has run TV ads and bought billboards touting it even though it is two to three years off from being sold to customers. Both companies are cutting to the bone as they try to avoid reaching such a low cash position that they have to file Chapter 11 bankruptcy. GM is hoping for an immediate infusion from the Treasury of $4 billion, and a total of $8 billion to $9 billion, while Chrysler is hoping for around $6 billion to $7 billion. Ford is not applying for an immediate loan, though it wants to secure a $9 billion line of credit from the Feds in 2009. At Congressional hearings this month, Chrysler, owned by hedge fund Cerberus Capital Management, said it would reach the critically low cash reserve level of $2 billion to $2.5 billion by year end. Chrysler’s sales have been hit hardest among automakers, with drops in excess of 45% the last two months. For the first 11 months of this year, Chrysler sales are down 27.7 percent to 1.4 million vehicles from 1.9 million for the same period last year. With the U.S. sales slump expected to continue into January, traditionally one of the slowest sales months of the year, the company has little revenue coming in and must pay suppliers $7 billion every 45 days. Chrysler’s lineup of vehicles is top-heavy with SUVs, and overall its vehicles rank lower for quality and customer appeal than its domestic rivals or Asian brands. Lawmakers have said repeatedly in the last month that Chrysler has no future as a standalone company. Tennessee Senator Bob Corker, for example, called the company “toast.” Chrysler is expected to get government loans, but it is widely anticipated that Uncle Sam will facilitate a consolidation of the company with GM, or preside over the sale of assets, like Jeep and the minivan business, to multiple automakers. It can afford to shut down factories because of the low demand for its vehicles and the inventory that is sitting on dealer lots with no buyers to drive them away. GM and Ford have extended their usual holiday shutdown as well. GM said this week it was cutting first quarter vehicle production by 250,000, or 30% from a year ago. That is the equivalent of an entire auto factory shutting down for a year. All auto companies have been severely hit by the scarcity of credit. Even consumers with good credit scores are having a hard time getting loans because banks have stopped lending. The finance arms of the U.S. Big Three have stopped leasing vehicles all together, and GMAC, GM’s loan arm, is hardly writing any business. www.businessweek.com/autos/autobeat/archives/2008/12/chrysler_shuts.html
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rosa
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Post by rosa on Dec 18, 2008 20:33:50 GMT -7
I have been lusting after my old Honda since the day we got the vehicle that replaced it
the American makers need to get with the program; paucity of loaners is only part of the problem here
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Post by Tim Collins on Dec 18, 2008 20:49:51 GMT -7
This is going to get real ugly before it gets any better.
My predictions
Look for the Big 2 to remain (Ford + a merged GM/Chrysler)
These two will lose further market share to Toyota
Many - perhaps as many as 1/3 of US auto workers will be unemployed/in new jobs for years.
Eventually they will introduce, probably if we are lucky within 36 months, a new line of cars running on LNG. To accomplish this they will ask for Gov. Susidies/tax incentives to car buyers, and to Southland Corp (7-11) and other current purveyors of Gasoline. The infrasturcture in terms of delivery of Natural Gas is already in place, what is needed is high pressure pumps, such as exist in california, to fill cars quickly. Currently home use pumps (around $4k) require over night to fill up.
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Post by webrunner on Dec 18, 2008 21:02:43 GMT -7
Whatever happens, the domestic car companies need to stop relying on guilt as a reason to by their product (you know, "buy American" and all), and start making a product that's competitive (we remember that term right) in quality with it's foreign counterparts.
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Post by Tim Collins on Dec 19, 2008 5:32:09 GMT -7
Web I disagree. The issue is not really the quality of the product. I have driven both imports and domestic and the quality overall is comparable. Now were we in 1980 or 1985 you would be right on target. The problem is cost of manufacturing. Our auto makers are inefficient.
Another problem I have is, with limited exceptions such as full size trucks, the desireability of the products produced. It seems to me every car is a me too product. Look around on I-10 most cars within the same class all look alike except for small details. Add to that the strange modern versions of classic car names, look what Dodge di to the Charger and Chevy did to the Malibu. UUUGH!
I keep telling friends that I am going to write to GM, Chrysler and Ford and tell them Give me a '70 Cuda with a 4 banger or an LNG engine and I will buy it, give me a 1958 Chevy Bellaire with a 4 banger or LNG and I will buy it for my family car, give me a '68 Camaro etc....
My point is I want the car to look good and be efficient - speed really does not matter much everyday. I picture an ad with a picture of a '70 Cuda at a gas station showing $0.35 per gallon gas, in the ocean behind them a Saudi Flagged Oil Tanker, and a banner saying "If we knew then...." and little arrows pointing to the engine with specs, the interior etc, next scene or page, a "smart car" and the banner "we wouldn't build this"...Next page, the same looking '70 Cuda with arrows pointing to a LNG Engine, air bags,etc., and a gas pump showing LNG price, a US Flagged pipeline and the banner saying..."we'd build this."
For a guy my age, 50, now I have the cash to buy the car I wanted at 17. I just can't find the car. A car is more an emotional than a practical purchase decision.
We need car power options that match our driving habits.
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rosa
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Post by rosa on Dec 19, 2008 6:04:43 GMT -7
Actually, as regards quality, I think there is room for argument here. We have a foreign sedan and a GM truck. Different models, so I know there's deviation here. But we have taken the car in once for repair of a head lamp. The vehicles are roughly the same age. Our truck has been in for engine repair three times in four years, this doesn't count recalls or two battery replacements due to faulty wiring that one recall "repair" was supposed to address.
This is a repetition of my previous experience in driving American vs. foreign cars. Husband did have a Ford that lived for forever until a gas line blew out while he was on the freeway one year. But overall, we have noticed differences in quality. And we are pretty good on maintenance.
Additionally, a relative who's an engineer has quite a bit to say about the differences between foreign (Japanese) and American standards on druability. His assessments agree with those of other friends-who work for American makers but drive "foreign" models
I say "foreign" because the standards aside, some of those "foreign" parts/cars are made here. American cars are made elsewhere (Mexico and Japan). Foreign makers employ American workers here
To say: "Buy American" is not as clear as one might think when it comes to cars. Remember the Geo? The Pontiac Vibe is a re-packaged Toyota Matrix; the Ford Escape and the Mazda (Tribute ?) are the same car, developed jointly by Mazda and Ford. So the distinctions/differences in durability can be a "market" in and of themselves. Suzuki makes small cars for GM-look under the hood. The labels on parts will say: Suzuki
When you buy a Volvo or a SAAB, you are "buying American" because they're owned by GM. So it's a lot more convoluted.
But the Japanese standards are higher, and this is one reason why Hondas and Toyotas are rated the way they are. And Hondas and Toyotas are made in the US according to Japanese criteria. What I don't understand is why we don't marry the best qualities from both markets to consistently produce higher quality/durability across the board. Well, actually, I do understand. I just don't agree.
My dad, who is elderly would agree with Snil about the emotional attachment to certain vehicles by the way. He loves certain models for the look alone, but wants the power even though he wouldn't use it. For me, the thing has to run reliably. It's a box that moves. If I had money to blow into the wind, it wouldn't be on a car.
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rosa
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Post by rosa on Dec 19, 2008 6:26:42 GMT -7
I agree with you both in terms of how American makers have managed, marketed and manufactured. They created their own demise, and there's still a lot of rigidity to the notion of change when you look at what they are doing to extricate themselves from the hole they've dug.
But as to the problems across the industry, there isn't any one market that isn't being hurt.
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Post by webrunner on Dec 20, 2008 12:34:34 GMT -7
Hear that Snil, you remind Rosa of her father. ;D You don't like the look of the new Charger? How about the new Challenger? Anyway, guys, don't get me wrong, I do not wish for the auto industry to fail at all. I just cringe when I see the U.S. move further away from a free market system. And Rosa, your point about not being able to know by brand name whether a car manufacturer is "American" or not is well taken. My main mode of transportation is a Honda, and I've had folks suggest that I'm not supporting "American" business, when, as Rosa points out Japanese car companies employ Americans too. I will buy what I believe is the better product, no matter where it comes from. That's the market that I want the "American" car companies to compete in and not to rely on guilting the consumer.
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Post by Tim Collins on Dec 20, 2008 14:41:37 GMT -7
New Charger is not a Charger. I speak with authority as a proud one time owner of a classic 1970 Charger. If it doesn't look like the Genral Lee it is not a Charger. For even thinking such a thing I have smited you once. You are down to 1 Karma! Now the new Challenger - they learned from the Mustang - the car has to look like its namesake to be worth the money
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Post by webrunner on Dec 20, 2008 21:04:22 GMT -7
New Charger is not a Charger. I speak with authority as a proud one time owner of a classic 1970 Charger. If it doesn't look like the Genral Lee it is not a Charger. For even thinking such a thing I have smited you once. You are down to 1 Karma! Now the new Challenger - they learned from the Mustang - the car has to look like its namesake to be worth the money Awe man. Will you give me my karma back (by the way, what happens if I get smited more than I get karmad?) if I tell you that I have a 2006 Mustang GT and that I love her.
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Post by Tim Collins on Dec 20, 2008 21:24:59 GMT -7
New Charger is not a Charger. I speak with authority as a proud one time owner of a classic 1970 Charger. If it doesn't look like the Genral Lee it is not a Charger. For even thinking such a thing I have smited you once. You are down to 1 Karma! Now the new Challenger - they learned from the Mustang - the car has to look like its namesake to be worth the money Awe man. Will you give me my karma back (by the way, what happens if I get smited more than I get karmad?) if I tell you that I have a 2006 Mustang GT and that I love her. Sorry no deal: 1. You already sang the praises of your Honda - any self respecting Mustang driver (if you like being Found On Road Dead) would have talked up their pony car. 2. I'm a MOPAR Fan
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rosa
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Post by rosa on Dec 20, 2008 22:24:33 GMT -7
New Charger is not a Charger. I speak with authority as a proud one time owner of a classic 1970 Charger. If it doesn't look like the Genral Lee it is not a Charger. For even thinking such a thing I have smited you once. You are down to 1 Karma! Now the new Challenger - they learned from the Mustang - the car has to look like its namesake to be worth the money Awe man. Will you give me my karma back (by the way, what happens if I get smited more than I get karmad?) if I tell you that I have a 2006 Mustang GT and that I love her. okay, it's been replaced Webrunner. That one about snil reminding me of my father? Heck, another one's on the way ;D if I can figure out how to do it. Smite me, bite me, hit me, push me, But to me, a car is just a car. Something to get you from points a through z and back again. Don't make much difference to me what it is as long as it's reliable, can fit the kids, the dogs, the accessories, and has a decent sound system. I like some of the muscle cars okay and I see snil's point about the Charger. But I can see other ways of burning money... I know, I'm headed for the "bad place" ;D
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rosa
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Post by rosa on Dec 20, 2008 22:28:48 GMT -7
I drove a Honda Accord into the ground and back again. It was my baby. I didn't need a pony. Want to get me excited? Run every day without breaking down, without causing problems. And see how I pet you and say nice things to you Husband talked me into a new veehiccup, we sold the Honda to a teenage jerk who wrecked it within two weeks
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Post by webrunner on Dec 20, 2008 23:36:19 GMT -7
Awe man. Will you give me my karma back (by the way, what happens if I get smited more than I get karmad?) if I tell you that I have a 2006 Mustang GT and that I love her. Sorry no deal: 1. You already sang the praises of your Honda - any self respecting Mustang driver (if you like being Found On Road Dead) would have talked up their pony car. 2. I'm a MOPAR Fan You are confused, Mr. Snil, sir. Ford means First On Race Day. vroom, vroom
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Post by webrunner on Dec 20, 2008 23:49:10 GMT -7
I drove a Honda Accord into the ground and back again. It was my baby. I didn't need a pony. Want to get me excited? Run every day without breaking down, without causing problems. And see how I pet you and say nice things to you ( I'm blushing. Oh, you meant the car. BTW, Rosa, all my friends call me Web. Thanks for replacing the Karma thingy.
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