Auto Industry Archive

Detroit has started thinking the unthinkable: first, that General Motors really could go bankrupt; second, and maybe even more unthinkable, that the rest of the country really could stand by and let it happen. Detroit-based Automotive News (where I used to work fulltime as a one-man bureau in New York City, and where I still work as a freelancer) on Nov. 14 posted an editorial called,...

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The future of the Detroit 3 automakers could be at stake in Congressional hearings next week into the sorry state of the U.S. auto industry, and whether taxpayer money should be used to help bail the industry out. The Senate Banking Committee, led by Connecticut Democrat Chris Dodd, goes first, with a hearing on Tuesday, Nov. 18, “Examining the State of the Domestic Automobile...

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Opposition to a would-be auto industry bailout seems to be hardening among Republicans in Congress. These are the people who would likely grill Detroit 3 executives like GM CEO Rick Wagoner when they get a chance, as I blogged here earlier. Sen. Richard Shelby of Alabama has taken to using the phrase with regard to the U.S. automakers, “This is not a national problem, it’s their...

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U.S. Treasury Secretary Henry Paulson weighed in with some encouraging things to say about freeing up credit for auto loans, but he stopped well short of promising direct aid for U.S. automakers. For that, he was roundly criticized by Democratic lawmakers who support an auto industry bailout. “It is shocking that given the urgent nature of this crisis, the President and the Treasury...

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Judging by opinion columnists and bloggers, there’s a growing backlash against the idea of a taxpayer-funded federal bailout for the Detroit 3, and especially against the notion of leaving in place the current management. As the biggest U.S. automaker and the lead company in pleading for federal help, a lot of this heat inevitably is directed at General Motors, and in particular at CEO...

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BMW, which was already having a rough time in the United States this year, now concedes there’s no way it will top last year’s worldwide record sales of just over 1.3 million BMWs for the full year of 2008. “In most Western European markets, Japan and the United States, sales for October were again lower than those for the same month last year,” said Ian Robertson,...

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President-elect Barack Obama has joined the chorus calling on the Bush Administration to do more to help the auto industry sooner rather than later. Sen. Carl Levin of Michigan said on Nov. 11 he was, “pleased that President-elect Obama pressed the need for immediate action for the auto industry,” following a meeting between Obama and President Bush to discuss the upcoming...

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For what it’s worth, the U.S. auto industry has sure demonstrated some political clout, or at least, friends in high places, judging by the advocates for a federal bailout they have gained in Congress — and not just from Michigan, either. U.S. Senate Majority Leader Harry Reid, D-Nev., and House Speaker Nancy Pelosi, D-Calif., sent a letter on Saturday, Nov. 8 to Treasury Secretary...

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Penske Automotive Group is making hay while the sun shines on the Smart, making a fatter gross margin on the Smart brand at wholesale than it does at retail, on bigger, more-up-to-date, more capable cars from other brands. Penske Automotive, one of the nation’s biggest auto dealer groups, has the U.S. franchise for the Smart brand, which is built by Mercedes-Benz. Penske has appointed 73...

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The cash emergency at General Motors has been brewing for a year, since GM starting burning up more cash than it was taking in. Before than, GM had built up its cash reserves five out of the previous seven quarters. The downturn in U.S. truck sales has been GM’s particular undoing. GM capacity utilization fell to 78.8 percent in the third quarter, down from 84.5 percent a year ago. That is,...

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