DawgTalkers.net Forums DawgTalk Everything Else... Jeep looks to shift production to China

Didn't you say you were going to admit when you were wrong?

I think he may be away at banned camp for one of the meltdowns he never has.

Read the entire op ed.

He was in favor of a structured bankruptcy, not pouring money into a company that was going to be doomed to fail again when the government check ran out.

Basically, if you read the op ed that began all of this, he was in favor of a structured bankruptcy. (which happened) He was then in favor of guaranteeing financing afterwards.

However, what happened was that the federal government screwed the bondholders of GM and Chrysler in order to pay off the unions. The unions jumped to the front of the line. The bondholders (not stockholders, but secured bondholders) should have been at the front of the line. Instead they were shoved to the back of the line. Bondholders were the people who provided money and financing to GM and Chrysler when they were struggling. They got screwed.

GM went through their bankruptcy, under the rule of the federal government. Standard bankruptcy protocol, if not laws, were thrown aside. In most bankruptcies, secured bondholders get paid at the same time other creditors do. Not in this case.



Anyway, back on topic ..... it amazes me when I hear theses idiots on TV saying "Mitt Romney wanted GM and Chrysler to go bankrupt!!"

They did go bankrupt! Both GM and Chrysler went bankrupt. They then reorganized. The only difference if that Obama paid off the unions, and took a heavy stake in each company. (gifting the UAW a share as well) He gave each company a huge amount of money in exchange for an equity share in each company. The amount of money he gave to GM is so large that it will almost certainly never be paid back according to the terms of the agreement.

I will say this again ..... I can "save" any company in America if I can redo every agreement they have with everyone from suppliers to distributors and retailers ...... can dump $50 billion into the new company, and dump every bad facility and contract they have.

We will never see the money we (the taxpayers) put into GM.

My point is that we put all of that money into GM as an equity share, with the agreement that once GM's stock reached the point where it could be sold off to repay the treasury, it would be.

This was the ONLY method of repaying treasury. This was the only legal method of divesting the government of GM stock under the equity agreement the federal government made to fund GM. The federal government, unless they change their rules, (which will absolutely never happen under this President, because he doesn't want to show that kind of loss of taxpayer money) cannot sell off their shares.

If the shares could be sold off, that money would return to the treasury. Though, I suppose that it would be wasted there just as quickly as anywhere else.

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Hey, phil, I'm going out deer hunting. How long will it take before you tell me that's a bad thing?

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I missed most of the back and forth between you guys so I went back and read it. Priceless. This was one of my favorites because the first thing I thought was, "Yeah, I think a guy like arch with a loaded gun is probably a bad thing....LOL".

The, "I'm not an Internet hothead, tough guy" was also a classic.

Who knew a China trade thread could be this entertaining? Thanks, guys.

http://money.cnn.com/2012/10/23/news/companies/romney-auto-bailout/index.html

NEW YORK (CNNMoney) -- Would the U.S. auto industry be doing as well as it is today if it was Mitt Romney completing his first term as president?

Romney argues that his plan for the industry in his now-famous November 2008 New York Times op-ed piece, "Let Detroit go bankrupt," was what the Obama administration eventually did: a managed bankruptcy at both companies. He insists that he was not in favor of the companies going out of business.

But in the 2008 piece, Romney said the money needed to keep General Motors (GM, Fortune 500) and Chrysler Group alive during bankruptcy should have come from the private sector, with the government providing only "guarantees for post-bankruptcy financing." Those guarantees would have made lenders whole if the automakers subsequently defaulted.

The problem was that there was no one available to write checks for the automakers other than the government in late 2008 and early 2009.

The financial markets had melted down in the wake of the Lehman Brothers bankruptcy. Treasury was pumping billions into the nation's banks, who were not willing to then lend money to a struggling auto industry -- or anyone else.

Related: GM back on top in global sales race


Steve Rattner, the Obama administration car czar at the time, said in his own New York Times op-ed piece that the administration tried to find private financing, but that "not one (would-be lender) had the slightest interest in financing those companies on any terms."

Rattner told CNNMoney on Tuesday that the administration never tried offering loan guarantees.

"If the government was going to be on the hook one way or another, we did not see the point in bringing in a private party," he said.



Bob Lutz, the vice chairman of GM at the time and an outspoken Republican himself, said the loan guarantees Romney talks about would not have made a difference due to the cash crunch at the time.

"The banks were even more broke than we were. Who had the money?" he told the Detroit Free Press in February. "Loan guarantees don't do any good if the banks don't have any money."

Without financing, both companies would have had to close. And even if they had survived, they could be struggling today rather than reporting record profits and strong sales. Many of their suppliers would have also been forced to shut down, and that could have caused bankruptcies at other automakers such as Ford Motor (F, Fortune 500), which would have been unable to build cars without their supplier base.

Lutz said Tuesday that the government was the only one willing to give GM most of the help it needed in return for stock in the company, rather than heaping on more debt that it couldn't afford. Even the Obama administration was reluctant to do that, Lutz said. But it was the only way a healthy GM could emerge from bankruptcy.

"Why perpetuate the problem with $53 billion of new debt, at an annual interest cost of, say, $3 billion?," Lutz said. Private financing would have left GM with "enough debt to wreck the future of a recovering GM."

In Monday's third presidential debate, Romney made clear he still opposes the $60 billion in direct help the automakers received from Treasury.

"My plan to get the industry on its feet when it was in real trouble was not to start writing checks. It was President Bush that wrote the first checks. I disagree with that," he said.

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"Let Detroit go bankrupt,"

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This is not a headline he wrote. It was written by someone at the Times.

http://businessjournaldaily.com/


Chrysler, GM, UAW, Brown Rebuke Romney's Auto Ads
Wednesday, October 31, 2012
By Dan O'Brien

NORTH JACKSON, Ohio – Republican presidential hopeful Mitt Romney's comments, television and radio ads that insinuate Chrysler's Jeep division would relocate jobs from Ohio to China drew sharp rebukes Tuesday from Chrysler, General Motors and labor leaders, and provided a flashpoint for U.S. Sen. Sherrod Brown's campaign as it rolled through the Mahoning Valley.

"I find it offensive and disingenuous that they would run an ad saying things that are clearly untrue about autos, about China," Brown said after addressing supporters at the union hall of United Auto Workers Local 1112, which represents 3,500 hourly workers at the Lordstown Complex.

Brown's "Road to Ohio Jobs Tour" -- replete with a caravan of Lordstown-made Chevrolet Cruzes and Jeeps produced in Toledo -- was on its fifth day of a seven-day trek across the state touting the auto rescue engineered by President Barack Obama and supported by Brown.

"It was so clearly the right thing to do," Brown said of the auto bailout. "I think the other side is desperate."

Brown is seeking re-election to his US. Senate seat and is opposed by Republican Josh Mandel, the Ohio treasurer.

On Friday, Romney made a speech in Defiance where he referenced a blog posting that inferred Jeep would be shipping jobs from Ohio to China. The Romney campaign continued the line of attack over the weekend when it launched television ads that echoed his comments in Defiance, and followed up with companion radio spots launched this week.

The TV ad states that Obama "took GM and Chrysler into bankruptcy and sold Chrysler to Italians, who are going to build Jeeps in China." (WATCH ROMNEY AD)

A new radio ad launched by the Romney camp suggests that auto bailout resulted in more jobs being created in China than the United States.

"Barack Obama says he saved the auto industry. But for who? Ohio or China?" the radio ad says. "Under President Obama, GM cut 15,000 American jobs, but they are planning to double the number of cars built in China, which means 15,000 more jobs for China. And now comes word that Chrysler plans to start making Jeeps in, you guessed it, China."

The ads and Romney's comments have sparked a chorus of denials and denouncements, include a rebuttal from the Obama campaign. (WATCH OBAMA AD)

On Tuesday, Chrysler Group CEO Sergio Marchionne addressed the issue in an email to employees. "I feel obliged to unambiguously restate our position: Jeep production will not be moved from the United States to China," he wrote. "

More than $500 million is being invested to retool Chrysler's Toledo Jeep plant, and Chrysler plans other investments at plants in Detroit and Belvedere, Ill. And Chrysler intends to invest $1.7 billion in its North American operations, Marchionne noted.

"Jeep assembly lines will remain in operation in the United States and will constitute the backbone of the brand. It is inaccurate to suggest anything different," Marchionne said (READ EMAIL).

"They're adding 1,100 jobs [in Toledo]," said Dave Green, president of UAW Local 1714, which represents 1,000 workers at the Lordstown stamping plant. "That they're moving jobs to China is just not true. Our base is very fired up about this and we're making people know it's a complete fabrication."

GM was even sharper in its criticism.

"We've clearly entered some parallel universe during these last few days," GM spokesman Greg Martin told the Detroit Free Press (READ STORY). "No amount of campaign politics at its cynical worst will diminish our record of creating jobs in the U.S. and repatriating profits back to this country."

In Youngstown on Monday, Vice President Joe Biden and former president Bill Clinton took Romney to task on the remarks. "Have they no shame?" Biden exclaimed.

Romney spent Tuesday in Kettering at a relief event to raise money for those affected by Hurricane Sandy.

Romney’s auto bailout ads precipitated a hailstorm of criticism from the UAW at the Brown campaign event Tuesday, which took on the atmosphere of an old-fashioned, charged up, get-out-the-vote rally.

"They're going to lie. They're going to cheat. They're going to steal. They're going to do everything they can do to take Ohio out of the win column for President Obama," thundered UAW International President Rob King.

"These lies are so outrageous, especially about China," King said, pointing to the efforts of Bain Capital, the capital investment firm once run by Romney. "What did [Bain] do? They took American jobs. They took American companies and they shut them down. They really made their fortunes off the misfortunes of workers, cutting workers wages, shipping their jobs to China."

Democrats depict the new Romney ads as a critical mistake in Ohio, a state considered the most pivotal in the presidential race.

"I think Romney's hung himself on this," said U.S. Rep. Tim Ryan, D-17. "It was such a blatant lie, and the power of it is that he wasn't just called out by President Obama, or Sherrod, or me – he got called out by Chrysler."

As a result, voters are likely to see Romney as a "typical politician" who will do anything and say anything to get elected, Ryan continued.

"My opponent called me un-American for voting for the auto rescue," Brown said. "My opponent and others opposed the auto rescue and it's working so well, that they've just acted desperately, and it's too bad, because it's just not been honest."

Polls suggest Brown and Mandel are in a tight race, which Brown attributes to outside money flooding into his rival's campaign from special interests such as the oil industry.

In a statement, Mandel called Brown an example of a career politician who continues to tow the Washington insider line.

"Sherrod Brown says one thing in the Mahoning Valley, and another thing in Washington," Mandel said. "What you won't hear from Sen. Brown is that he's a 38-year career politician who's voted for taxpayer-funded bailouts, a failed stimulus, and a government takeover of health care. "

Brown says the ripple effect of the auto rescue reverberated throughout the economy, from second-and third-tier suppliers to hardware stores. "We knew there were 800,000 people in this state directly or indirectly connected with the auto industry," he explained.

The Cruze, for example, is manufactured in Lordstown, but its engine is produced in Ohio, its transmission is manufactured in Toledo, plastic parts are produced in Akron, components for an airbag are made in Brunswick, the steel is produced in Cleveland, and the seats are manufactured in Lordstown, he said.

"The auto rescue was the beginning of the Ohio comeback," Brown said. "Our unemployment rate, since the auto rescue took hold, has dropped three and-a-half points. It's not enough. We still have too many people unemployed in Niles, Girard, Austintown and Youngstown, but we're moving in the right direction."

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"Our unemployment rate, since the auto rescue took hold, has dropped three and-a-half points. It's not enough. We still have too many people unemployed in Niles, Girard, Austintown and Youngstown, but we're moving in the right direction."

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Only because of how many people have left the Valley. Fracking has added jobs to the area but that is about it. I'm not positive but I believe Lordstown is employing less people than in years past. I remember them running 3 full shifts.

The fact is the Democrats have always taken the Valley for granted since they win by so many points here. They attacked Ungaro for his attempt to gain state money by working with Republicans like DeWine and Voinovich. The Republicans have no real interest in us because we are a lost cause. Until we make some real noise we will lose out to other parts of the state.

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Fracking has added jobs to the area but that is about it.

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As a fan of the new Battlestar Galactica, this makes me giggle.

I'm just wondering how people are going to react when we need to bail GM out again for another bankrupcy. They are losing market share and are not as profitable as far as margins go against most of their competitors. Their new Malibu is getting not so great reviews against the competition in what is probably the most important model type they sell. If they don't turn things around soo we will likely see them begging for additional funds sometime during the next 4 years.

The thing that worries me about GM is this:

The federal government is dictating what kind of cars GM will build, rather than the market telling them what people want, and will buy. I have a feeling that this will get worse if Obama is re-elected. If so, this will lead to more and more money (support, if you will, for our already sizable taxpayer "investment") being required.

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The federal government is dictating what kind of cars EVERYONE will build,

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Fixed

Ford Econoline will be gone in another model year. Between the F-Series Trucks and the E-Series Vans Ford's average MPG for all vehicles sold is too low for the new standards coming up. So they have to bring over their European Van the Transit. Right now the Econoline is build out in Avon Lake, the Transit will be built in Kansas City. Think about how many jobs in NE Ohio that is going to lose.

All because the Government told Ford they sell too many vehicles with low MPG.

That is true.

However, the government can dictate specifically and precisely what GM will build. They are the bosses, and have the final word if they choose.

I would also add that they have the advantage of a dual role.

As owner they can specify what GM builds. If what GM builds does not sell, they can throw tax credits on micro cars that are fuel efficient. Further, they can count on it.

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However, the government can dictate specifically and precisely what GM will build. They are the bosses, and have the final word if they choose.

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So the government is like Joe Banner?

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the government makes their own money too. they just print more out anytime we run low, right?

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I'd laugh if that wasn't so sad ...... as well as so true.

It sure would be nice to be able to run up the credit cards forever, for as much as you want, without ever having to worry about paying it off.

Well if you knew your life expectancy was only 8 years and all of the debt would become somebody elses problem and all you wanted to do was make everybody happy in the here and now so they would like you.. it's a heck of a plan.

Back on topic:

The CEO of Chrysler has confirmed that they are going to manufacture Jeeps in China.

The Obama campaign has made a big deal out of the Romney ad talking about this ...... and they are calling Romney a liar ...... but everything the ad says is true. He never said that they are "moving" production to China ...... however, Jeeps will be built in China in the near future. This may not be moving production, but it is taking production that might possibly be assigned to a US plant and moving it instead to China.

Anyway .... the Dems are going nuts over this ad, but technically it is 100% true.

Frankly though, this is what I hate about politics. Minor points of truth that lead the viewer to assume that something else is true ..... even if it isn't. Both sides do it, and it really is a dishonest way of advertising. There's no flat out lie ..... but the conclusions that they try to lead the viewer to are not the truth.

However, that being said ..... I see no way that the shifting of production of Jeeps to China plants won't cost some jobs. It is only common sense that if Jeeps are being sold in China right now, and they are moving production to China, that those people in China who buy Jeeps in the future will buy China built Jeeps. That means that they will not buy a US built Jeep. (or Canadian, or Mexican built vehicle)

They could also ship them to other countries in the east since it is much cheaper than shipping them from here.

Yet that's not what the commercial said.

I am just so tired of all of the political commercials. I can't wait for the elections to be over. Even for a political junkie like me, this election has been way too stupid and long.

I understand that. But it's handing you the pencil and telling you to connect the dots. It's disingenuous at best and willfully and blatantly dishonest at worst.

If you think that Romney has anything even remotely approaching a monopoly on distprsions, or even outright lies, well, then you haven't been paying attention.

Obama lied his ass off at the final debate. Romney challenged him on some, and let some slide for some reason. Obama has lied about what happened following the terrorist attack in Benghazi.

Both do it, and neither has a monopoly.

I pay attention more than most.

I never stated Romney owned a monopoly on this ability, and clearly acknowledge that it occurs on both sides. It is after all politics, or the art of lying. But in his desire to push his version, the Romney campaign has become more aggressive and less creative in order to slice and dice the truth. It does not pass the sniff test, and that comes back to hurt him.

Romney put it out there with his op-ed and it will probably cost him Ohio. No he did not write the title, but the words were his. He may come from an auto family, and love cars, but he opposed the government bail out. You can't rewrite that history.

I appreciate your brevity, Adam. Very to the point. The political commercials being aired right now- not sure what you guys have to put up with in Ohio; compared to Michigan- are over-simplified to the point of "Here's a straw-man and scary correlation! Vote off the opinion at the end of this spoon" don't facilitate a healthy democracy based off of vital information actually related to the issue.

But, hey! Money is speech. Forget that the money is concentrated merely in the hands of who has enough to pull puppet strings. So long as the message garners an emotional trigger- typically based off of fear or shallow self-interest- it'll reach just the folks it's after: people who are easily swayed enough by a thirty second quip to go off and uninformed-ly check whatever a commercial told them to do, no further research necessary!

As far as the op-ed .... basically, he called for GM and Chrysler to go through bankruptcy, and then receiver government guarantees for financing.


What happened with Obama? GM and Chrysler went through bankruptcy. The only difference is that Obama's White House dumped tons of money into GM to pay off the union, and then took an equity share in bot companies.

We lost money ... billions of dollars .. on the Chrysler deal.

We will lose billions .... tens of billions ..... on the GM deal ... whenever we sell of our equity share.

Romney's plan would have GM and Chrysler paying their lender back, for loans the government would have guaranteed. In Obama's case, GM will never pay anyone back. The stock will never reach the price level necessary for taxpayers to recoup their investment. Maybe, if they are lucky, 20 pr 25 years from now GM might reach the stock price necessary for the government to recoup our money. The stock would have to increase in value to somewhere in the range of 250% its current value for us to get out while breaking even. GM stock has stayed fairly level despite the stock market increasing substantially in value over the past few years. GM has gone the opposite direction. They started at $33/share, and are trading today at $25.68. This is up from $22 something the other day ..... but within the range this stock has been trading.

The whole thing was unnecessary. We could have, and should have done as Romney said, and let GM and Chrysler go through a regular bankruptcy. They then could have reorganized, set new union contracts and agreements, dumped underperforming and unprofitable facilities, and so on. Basically ..... doing what they did anyway. However, Obama wanted to save the union pensions and contracts, (though they screwed over the salaried employees of Delphi by not treating them the same in the bankruptcy) and he did so using a LOT of taxpayer money to do so.

Of course, GM won't be sold until sometime in the next 4 years ....... so much like Obamacare, the real cost won't impact anything until them.

Well, they could have lost their pensions and ended up being part of the 47% so they can be villified that way instead