"DETROIT - Faced with soaring gas prices, a sputtering economy, and rapid U.S. market shift away from trucks, the U.S. auto industry's weakest player, Chrysler, may have to seek bankruptcy or sell its Jeep and Dodge Ram brands as early as next year, JPMorgan said yesterday.
But rivals GM and Ford are likely to get through the rough patch and turn a profit in 2010."
http://toledoblade.com/apps/pbcs.dll/article?AID=/20080704/BUSINESS02/80...
Bankruptcy will allow them to not only cancel labor contracts, but also cancel benefits arrangements with retirees. THOSE are what they really want.
This is a real drag on the companies.
Yes, people built the businesses and shared in the good times, but retirees add nothing to the bottom line.
Recent labor agreements have shifted the costs of the benefits from the company to the union, too little, too late, maybe.
Trends from large gas consuimg vehicles and poor planning on the part of the Bug Three are helping those auto makers like, "But while Honda may look like it can peer into the future, the company's top U.S. executive said it is well-positioned for $4 per gallon gasoline because it always has emphasized small, fuel-efficient vehicles."
http://toledoblade.com/apps/pbcs.dll/article?AID=/20080704/BUSINESS02/80...
Option 3)
Let oil companies drill where there is oil. Open ANWR and the gulf coast.
Get the government out of the way. Stop the 34% profit grab on leases in the gulf.
Get government out of the way and let the free market work. With cheaper gas prices, the American automotive industry would no longer be standing around in Detroit with their pants down taking the hits from Honda and Toyota.
I vote for
When speculators and traders are bidding the cost of the fuels up, at the drop of a hat or threat to a pipeline some where in the world?
So much of the jump in gasoline prices is related to investors looking for safe harbors and making a buck with the bucks they have.
Would gas prices really be lower?
Yeah, by a couple of pennies per gallon---20 years from now. OIL IS DONE. NO MORE WARS FOR OIL. NO MORE RECESSIONS FOR OIL. NO MORE CLIMATE CHANGE FOR OIL.
So how is that guarantee for $2.99/gallon gas for the next 3 years going to work?
(Don't get me wrong...I was suspicious about that from the get go. Didn't think there was any reasonable way Chrysler could really make that promise, not knowing how high gas was going to go and what kind of financial burden they'd be undertaking.)
The "Big Three" (in reality, 3 of the Big Five Or Six that just happen to be HQ'd in the USA) are used to signing on for unlimited liability. THAT is how they "guarantee" it. Therefore it's not a particular predictor of anything except future weakness in the company's business plan.
Obviously, not enough of Chrysler's stock is held in independent hands. What real pack of shareholders would sit still for this kind of shit?
The Big 3 trusted that Americans would keep buying gas guzzlers. The laborers and unions trusted that their honeypot retirements were in the right hands. The legislators trusted that the oil companies would be responsible.
I say we start trying to find the next Teddy Roosevelt. Only someone like him could talk some sense into everybody.
MikeyA