FROM John McElroy
Today, It's Chrysler... Tomorrow, GM? Big banks who've accepted billions in federal bailouts had little choice when President Obama demanded that they take "haircuts" to keep Chrysler in business. But smaller investors, including hedge funds, said no deal, and now Chrysler's reorganizing in bankruptcy court.
Today, It's Chrysler... Tomorrow, GM? President Obama says he does not want to run a big automaker , but the federal government could end up owning 50% of General Motors. In the meantime, it will own 10% of a new, multi-national company when Chrysler merges with Fiat , presuming, of course, that bankruptcy goes well. Big banks who've accepted billions in federal bailouts didn't have much choice when Obama demanded they take "haircuts" to keep Chrysler in business. But smaller investors, including hedge funds, said no deal, forcing Chrysler's reorganization in bankruptcy court. We hear about the economics and politics involving investors, unions, part suppliers and dealers. Also, what about the cars? Will American drivers change their ways and go European?
As Truck and SUV Sales Plunge, Detroit Goes for Small Urban cowboys in pickups and SUV's are a thing of the past. More and more customers don't even talk about power any more. Ford, Chrysler and General Motors were not ready for four-dollar gasoline, and June was another disaster for an industry that helped make America great, with sales of new cars and trucks that plunged to a ten-year low. GM dropped 18%; Ford 28% and Chrysler 36%. Toyota took a 21% hit, but Honda rose by 1.1 and Kia , owned by Hyundai of South Korea, went up by 7.6. We talk with a Chrysler/Jeep dealer who says the Big Three are their own worst enemy. Can they re-tool in time? Can they figure out how to make money on small cars with high mileage before they're swamped by foreign companies who saw the light a long time ago?
Cars, Cars and More Cars The Detroit Auto Show used to be all about size, speed, style and America's domination of the world market. This year even China's in on the action, marketing strategies you might call unorthodox, while more familiar players push plug-in hybrids, clean diesel and cars that run on industrial waste. Toyota is competing with GM to go green, but has to admit that the auto industry will always be bad for the environment. What's next for American drivers? Can the world sustain the expanding automobile economy?
Chrysler to Cut up to 10,000 Hourly Jobs, Drop Models Less than a week after Chrysler workers narrowly approved a new contract , the auto-maker said today it's cutting thousands of jobs and discontinuing several models of cars. John McElroy hosts Autoline Detroit, which appears on public television and the Speed Channel.
Fixing the American Auto Industry Sales at Ford Motor Company dropped 18% last month, and Toyota outsold Ford by 35,000 vehicles—many of which were Made in America. Meantime, workers at General Motors are voting on a contract some say will save the company—and maybe Ford and Chrysler , as well, although skeptics say the union didn't give up enough. These are bad times for the industry that once dominated the world's strongest economy. Can it become competitive once again? We hear more about that GM contract, mileage standards, global warming—and clean diesel.
Ford Reports Worst Loss in History A year ago, the Ford Motor Company lost $74 million. Today, Ford announced it's in the red by $12.7 billion. Last year was the worst in the company’s history. John McElroy is host of Autoline Detroit.
Car-Culture Capital Hosts Centennial Auto Show LA's first auto show consisted of 99 cars inside a skating rink--100 years ago. The show that opens tomorrow will have numerous cars from each of 47 different manufacturers, ranging from subcompacts to full-size luxury sedans, pickups, SUV's, crossovers and sports cars. Despite its history, the Los Angeles Auto Show has an inferiority complex. It was purposely scheduled this month to avoid conflict with its younger, much bigger brother, the Detroit Auto Show . Governor Schwarzenegger, who wants California to take the lead against global warming and auto pollution, challenged auto makers to deliver more efficient clean-air vehicles. Meanwhile, the US Supreme Court took up Massacusetts v EPA , over whether the US Environmental Protection Agency be sued for refusing to regulate carbon emissions, since the Clean Air Act mandates that all pollution sources be regulated.
Ford Taurus, RIP Americans once purchased over 400,000 Tauruses a year, but Ford says it expects to sell less than half that number in 2006--and there won't be a next year. Taurus made its debut in December, 1985. By the early 90's it had became the best-selling passenger vehicle in America. But Taurus' sales have plummeted in recent years. This week marks the end of an era as the last Ford Taurus rolls off the production line in Atlanta.
Mixed Messages from US diplomats on the new hard line on Syria Since President Trump's surprise retaliation against Syria's use of chemical weapons, Bashar al-Assad has used the same airport to launch conventional attacks on his own people. It's not clear what the US, its allies — or Vladimir Putin's Russia -- plan to do now.
Trump's ethical conflicts pile up as transparency diminishes President Trump's refusal to reveal his income tax returns is just one example of a lack of transparency that could be hiding conflicts of interest. Other conflicts are already obvious from his appointments. And he's being sued for using his job to increase his profits.