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GM Volt technology allows a car to drive for 40 miles before switching over to gas/petrol – but we already have electric cars like the Tesla that can go 240 miles without recharging – plenty enough for everyday driving – at about 2 cents/mile to run.

It seems that the auto makers are stalling ~

US Auto makers roll out fuel efficient cars

See no exhaust pipe! 0-60 3.6 seconds! Cost $4 per 240 mile charge to run!

Tesla Roadster: See no exhaust pipe! 0-60 3.6 seconds! Cost $4 per 240 mile charge to run!

I think the whole aim of the car industry has been to keep us on oil – and so for years they have been suppressing any and all viable alternatives. While we advance in leaps and bounds in computers and technological industries — aside from the outer cover and some new electronics – cars have virtually stayed the same. In today’s technological world this is unacceptable.

Not surprisingly sympathy is thin on the ground for the Big Three automakers – and in order to survive they are going to have to decouple from the oil industry. This is where policy comes in – as the Bush administration has been all about oil – and how to get us all to spend more on it – he got his wish – but it was a bit like the king who touched his daughter and turned her into gold. Up until recently the whole aim was to make us believe – that we needed more and more of this oil – this coming directly from the addict-in-chief. The mindset is so bad – that at the RNC you had Republicans chanting Drill Baby Drill, because the thought of a technological way around the oil – is unthinkable to them. 50 years down the line they still see us using the same technology – needing roughly the same amount of oil. Palin – an oil addict and others like herself – first need to line up the belief that we need this oil and we can not do without it – for a long long time – then they place themselves in the position to be the providers of that oil. Even better than the measly cash that a guy would make as a lobbyist. This is like Beverly HillBillies’ cash – no wonder they are addicted.

But here is the trap for the car industry – The Big Three – Republicans are into little or no government intervention – their philosophy is bankruptcy would do them good – ironically the Drill Baby Drill – was for the hungry engines the Big Three were making – that they refused to modernize [in ways that inventors have done time and time agian in their garages] – more a Republican-conservative idea – oh the betrayal!

On the other hand the Democrats’ position – is that the Big Three have been too arrogant for too long – and they are actually holding up real progress – if you want us to bail you out – then we are going to have to see some electric cars, some hybrid/electrics and cars that are going to largely bypass the burning fossil fuels to run. The oil addicts should be getting really uncomfortable – but these are the same guys who are willing to let the car companies fail.

Alternatively, by letting the car industry collapse – the Obama administration can then divert more funds to the smaller car industry – which are willing to produce the cars of the future – like the Tesla.

Porsche (eRuf Model A) the first fully electric version of the car.

Porsche (eRuf Model A) the first fully electric version of the car.

This whole bailout/loan deal with the auto-industry will hinge on what kind of plan these automakers will come back with in two weeks – we can only hope that it will not be a plan to help the oil industry – but one with a view of the future – that will instead help themselves and the people who will be driving their cars. I’m all for the fully electric SUV. Who says we have to make them small – just energy efficient. Today the best car batteries can take us 200 miles/300 km on a single charge – tomorrow 400 miles/600 km on a single charge? We may end up having to charge our cars once a week – today it cost 2¢/mile to run – tomorrow it might 2¢/10 miles? If the present car industry isn’t willing to do it – perhaps we need an alternative car industry.   


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No v. 21 (Bloomberg) — President-Elect Barack Obama’s transition team is exploring a swift, prepackaged bankruptcy for automakers as a possible solution to the industry’s financial crisis, according to a person familiar with the matter.

A representative of Obama’s team has already contacted at least one bankruptcy-law firm to say that Daniel Tarullo, a professor at Georgetown University’s law school who heads Obama’s economic policy working group, would call to discuss the workings of a so-called prepack, according to this person.

U.S. lawmakers yesterday delayed until December a vote on whether to give General Motors Corp., Ford Motor Co. and Chrysler LLC a $25 billion bailout. GM today said it would idle production at four plants an extra week and return some corporate jets to conserve cash. Automakers could use a judge-supervised bankruptcy to reduce debt and reject expensive contracts.

“It creates the environment to deal with GM’s problems but limits government financial commitment,” said bankruptcy lawyer Mark Bane of Ropes & Gray in New York.

Bankruptcy is just one option being examined. Obama told CBS News’s “60 Minutes” on Nov. 16 that government aid to automakers might come in the form of a “bridge loan,” advanced if the industry could draw up plan to make itself “sustainable.” The president-elect earlier urged Congress to approve as much as $50 billion to save automakers, using the model of Chrysler’s bailout in 1979.

Tarullo referred questions on a prepack to the transition team press office. Team spokeswoman Stephanie Cutter said, “We have not put out anything specific for the auto industry except that something needs to be done immediately.”

No Cash

GM, the largest U.S. automaker, said it might run out of cash as early as the end of the year and that the risk was even greater by mid-2009. GM Chief Executive Officer Rick Wagoner said this week GM would have to liquidate if it filed for bankruptcy.

The automaker probably has weeks rather than months left before it runs out of money unless it gets federal aid, Jerome York, an adviser to billionaire Kirk Kerkorian and a former GM board member, told Bloomberg Television yesterday.

In a prepackaged bankruptcy, an automaker would go into court with financing in hand after reaching agreement with lenders, workers and suppliers on what each would give up and on the business plan to be followed. The process might take six to 12 months, compared with two to five years if the automakers followed an ordinary Chapter 11 proceeding and worked out agreements under a judge’s supervision, Bane said.

Government Financing

Automakers would have to depend on government financing to restructure in bankruptcy court and probably couldn’t attract private loans until they were ready to emerge from the process, Bane said.

Officials of the three automakers told members of Congress this week that they had studied a pre-arranged bankruptcy, championed by Republican lawmakers such as Senator Bob Corker of Tennessee, before dismissing the idea as unworkable.

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11-10-2008-10-32-30-pm

This failing economy and troubled auto industry is the perfect storm for Obama and the Democrats, if the auto industry was strong — how could you get it to change direction? The writing was on the wall some eight years ago that the oil age was coming to an end – that to continue to pursue it would lead us into difficulty. And it was one of the hallmarks of Al Gore’s presidential campaign. Now we have seen the results of continuing down the same path. But with this disaster or more stripping of the sector – there is opportunity; the free market idea is to allow the auto industry to fail, or it can be bailed out under conservative socialism, or we can forget about the old titles and give the auto-industry the money it needs but with the strings attached – that it retools for the future car. Why can’t we have a hybrid/electric or an electric SUZ? And this merchandise can be exported – the market should be thrilled.

Bush is arguing – he’ll give Obama this – if in return Obama cedes with the Republican position on trade with Columbia. And it is a weak argument – because what Obama is saying – we will be happy to trade with you – but you are going to have to pull your act together when it comes to workers rights. This carrot and stick approach may do more to change conditions in Columbia – than all the diplomacy in the world. Doubtful if this is a chip that can be traded because it has a long term goal.

WASHINGTON — The struggling auto industry was thrust into the middle of a political standoff between the White House and Democrats on Monday as President-elect Barack Obama urged President Bush in a meeting at the White House to support immediate emergency aid.

Mr. Bush indicated at the meeting that he might support some aid and a broader economic stimulus package if Mr. Obama and Congressional Democrats dropped their opposition to a free-trade agreement with Colombia, a measure for which Mr. Bush has long fought, people familiar with the discussion said.

The Bush administration, which has presided over a major intervention in the financial industry, has balked at allowing the automakers to tap into the $700 billion bailout fund, despite warnings last week that General Motors might not survive the year.

Mr. Obama and Congressional Democratic leaders say the bailout law authorizes the administration to extend assistance.

Click to enlarge+

Click to enlarge+

Mr. Obama went into his post-election meeting with Mr. Bush on Monday primed to urge him to support emergency aid to the auto industry, advisers to Mr. Obama said. But Democrats also indicate that neither Mr. Obama nor Congressional leaders are inclined to concede the Colombia pact to Mr. Bush, and may decide to wait until Mr. Obama assumes power on Jan. 20. […]

As the auto industry reels, rarely has an issue so quickly illustrated the differences from one White House occupant to the next. How Mr. Obama responds to the industry’s dire straits will indicate how much government intervention in the private sector he is willing to tolerate. It will also offer hints of how he will approach his job under pressure, testing the limits of his conciliation toward the opposition party and his willingness to stand up to the interest groups in his own. [….]

Obama has called on the Bush administration to accelerate $25 billion in federal loans provided by a recent law specifically to help automakers retool. Late in his campaign, Mr. Obama proposed doubling that to $50 billion. But industry supporters say the automakers, squeezed both by the unavailability of credit and depressed sales, need unrestricted cash now, simply to meet payroll and other expenses.

On Friday, Mr. Obama said he would instruct his economic team, once he chooses it, to devise a long-range plan for helping the auto industry recover in a way that is part of an energy and environmental policy to reduce reliance on foreign oil and address climate change.

[….]

Democrats close to both Mr. Obama’s transition team and to Congressional leaders seemed willing to call Mr. Bush’s bluff, calculating that he would not want to gamble that G.M. — an iconic, century-old American corporation with business tentacles in every state — would fail on his watch and add to the negative notes of his legacy. Also, economists as conservative as Martin Feldstein, an adviser to a long line of Republican presidents and candidates, have called more broadly for stimulus spending of up to $300 billion.

The major automakers — G.M., Ford and Chrysler — are each using up their cash at unsustainable rates. The Center for Automotive Research, which is based in Michigan and supported by the industry, released on Election Day an economic analysis of the impact of one or all of them failing. If the Big Three were to collapse, it said, that would cost at least three million jobs, counting autoworkers, suppliers and other businesses dependent on the companies, down to the hot-dog vendors and bartenders next door to their plants.

[…]

Organized labor is not the only interest group with influence in the Democratic Party that is weighing in as Mr. Obama plans his transition. Environmentalists are adamant that any aid be conditioned on the auto industry’s dropping of its opposition to higher fuel-efficiency standards and investing more in new technology. That puts them at odds with unions, who oppose any strings, leaving it to Mr. Obama to mediate.

Both as a candidate and now as president-elect, Mr. Obama has been in contact with former Vice President Al Gore, who last year won the Nobel Peace Prize for his work on climate change. In a column published in Sunday’s New York Times, Mr. Gore wrote that “we should help America’s automobile industry (not only the Big Three but the innovative new start-up companies as well) to convert quickly to plug-in hybrids that can run on the renewable electricity that will be available.”

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