Chrysler Screws Dealer!

[stevento]

"The clock is ticking for Ray O'Bryhim: he has less than a week to sell his last 40 cars."

Here's the long and short of it: He is the owner of one of the 789 dealerships that got a letter from Chrysler LLC stating the fact that they are kicked to the curb. As of June 9. After that it will be illegal for him to sell new Chryslers. And since Chrysler is in bankruptcy, they don't have to take them back. He could move them to other dealers' inventory but he doesn't know what they'll pay for them.
link (http://www.cnn.com/2009/US/06/02/dealership.closing/index.html)

[quagmire]

That is a short deadline, but don't feel all to bad about these dealerships as they have screwed Chrysler( and GM) over a lot too. Dealers have lobbied so much to get laws that make it hard for automakers to get rid of dealerships outside of Chapter 11. Dealers with crap customer service has turned many consumers away from GM and Chrysler due to people thinking the poor dealer experience is directly tied to GM and Chrysler. I agree that is an extremely short deadline to move 40 cars in this economy though and Chrysler should have at least given him until August or so to move those cars.

Automakers should be allowed to open corporate stores much like AT&T, Verizon, etc can.

[yg17]

Car dealers are about the last thing on my list of things to feel sorry for. Is there a such thing as a car dealer that isn't a sleazy cheater?

[dukebound85]

Car dealers are about the last thing on my list of things to feel sorry for. Is there a such thing as a car dealer that isn't a sleazy cheater?

uh good job stereotyping:rolleyes:

yes, there are honest car dealers...

yes, i feel sorry for them

[Ugg]

That is a short deadline, but don't feel all to bad about these dealerships as they have screwed Chrysler( and GM) over a lot too. Dealers have lobbied so much to get laws that make it hard for automakers to get rid of dealerships outside of Chapter 11. Dealers with crap customer service has turned many consumers away from GM and Chrysler due to people thinking the poor dealer experience is directly tied to GM and Chrysler. I agree that is an extremely short deadline to move 40 cars in this economy though and Chrysler should have at least given him until August or so to move those cars.

Automakers should be allowed to open corporate stores much like AT&T, Verizon, etc can.

+1

Many dealers are slimeballs and I don't have much sympathy for them. I'm sure there are a few low margin dealers that are getting screwed but dealers are a large part of the problem.

Corporate owned BMW, Volkswagen and Mercedes delivery centers would have a phenomenal impact on auto sales in the US, but they're impossible to create here because the dealers have a deathgrip on new car sales.

How many new cars rolling off the assembly lines are special orders? Probably very few because the dealers have forced packages onto customers whether they like them or not.

I don't know what the dealers will be like in the future, but I certainly hope there are a lot more honest ones than there have been.

[rdowns]

Regardless of how sleazy some (many?) car dealers are, this is pretty effed up. These dealers were already struggling. The least the government could have done here was make the closing of these dealers a bit fairer.

Even worse...Saw a story on ABC News that people with pending product liability suits against Chrysler and GM will be lucky to see a dime. Pretty sad when they showed people who were injured for life with huge medical bills.

[mactastic]

Would it be any different if Chrysler was voiding union contracts rather than dealership contracts? We've had quite a few people come through here arguing that all union contracts should be allowed to be voided, so why not dealership contracts?

[Demosthenes X]

Would it be any different if Chrysler was voiding union contracts rather than dealership contracts? We've had quite a few people come through here arguing that all union contracts should be allowed to be voided, so why not dealership contracts?

I don't think anyone is saying that Chrysler doesn't have the right to tear up contracts - they do, and they need to do it. That doesn't make it a nice thing, and there should be some sympathy for the people that are given six weeks notice to find a new way to earn a living. In particular, I wonder why Chrysler couldn't have given more notice, or given a grace period allowing dealers more time to liquidate their inventory once their franchise contract expired...

[swiftaw]

On the flip side, as a consumer you can probably get a really nice deal if you walk into the dealership just before June 9.

[takao]

That is a short deadline, but don't feel all to bad about these dealerships as they have screwed Chrysler( and GM) over a lot too. Dealers have lobbied so much to get laws that make it hard for automakers to get rid of dealerships outside of Chapter 11. Dealers with crap customer service has turned many consumers away from GM and Chrysler due to people thinking the poor dealer experience is directly tied to GM and Chrysler. I agree that is an extremely short deadline to move 40 cars in this economy though and Chrysler should have at least given him until August or so to move those cars.

Automakers should be allowed to open corporate stores much like AT&T, Verizon, etc can.

in the article it states that they were informed on the 14th may and since then they already sold 80 of their vehicles so it's not that short of a deadline

which means he had in may 120 vehicles sitting in the lot


for comparison the article also states that on may 14th the terminated 800 dealers had 44.000 cars in their lots which averages out around 55-56 cars per lot .. if you then factor in 27 days it's not impossible to sell that much.. my guess is that the dealer simply had too much piled up with 120 vehicles

[mactastic]

That doesn't make it a nice thing, and there should be some sympathy for the people that are given six weeks notice to find a new way to earn a living.
I got two weeks severance, and zero notice; yet you don't see me complaining about how my former employer should have had more sympathy...

[leekohler]

I don't think anyone is saying that Chrysler doesn't have the right to tear up contracts - they do, and they need to do it. That doesn't make it a nice thing, and there should be some sympathy for the people that are given six weeks notice to find a new way to earn a living. In particular, I wonder why Chrysler couldn't have given more notice, or given a grace period allowing dealers more time to liquidate their inventory once their franchise contract expired...

Six weeks? That's almost unheard of! Most places give no notice when they lay people off.

[abijnk]

I think its a little different in this case. I'd be willing to bet mactastic didn't have hundreds of thousands of dollars in inventory to clear out or be left holding the bill. They need to do something about the cars that dealers are stuck with, even if that is just allowing them to sell the cars as long as it takes to clear them out.

[Sdashiki]

An automobile IS STILL worth a lot of money.

Yup, you're screwed Mr Dealer because you wont get "full value" for it...but since you more than likely were holding the inventory on spec/hold for the manufacturer, you wont actually lose money, but probably break even.

Im not saying its a good thing this is happening, but its not as bad as people make it out to be.

Not as if these cars magically cant be driven anymore, or dont work, or arent brand new with the smell.

[bobfitz14]

Car dealers are about the last thing on my list of things to feel sorry for. Is there a such thing as a car dealer that isn't a sleazy cheater?

uh good job stereotyping:rolleyes:

yes, there are honest car dealers...

yes, i feel sorry for them

+1 to you dukebound, there was a dealership owner on the radio the other day and (since it was really early i forget what he specifically said) he clearly wasn't a bad person or anything, though upset about the fact that his business was going under he was still pretty calm. i DO feel sorry for most.

[FX120]

I got two weeks severance, and zero notice; yet you don't see me complaining about how my former employer should have had more sympathy...

But the problem isn't that they're just out of a job, it's that they now have (typically) several million dollars invested in inventory which becomes impossible to sell after their contract expires.

An automobile IS STILL worth a lot of money.

Yup, you're screwed Mr Dealer because you wont get "full value" for it...but since you more than likely were holding the inventory on spec/hold for the manufacturer, you wont actually lose money, but probably break even.

Im not saying its a good thing this is happening, but its not as bad as people make it out to be.

Not as if these cars magically cant be driven anymore, or dont work, or arent brand new with the smell.
They'll have a really hard time selling their stock when competing dealers have factory incentives and rebates and can offer a lower price...

[mactastic]

I think its a little different in this case. I'd be willing to bet mactastic didn't have hundreds of thousands of dollars in inventory to clear out or be left holding the bill. They need to do something about the cars that dealers are stuck with, even if that is just allowing them to sell the cars as long as it takes to clear them out.
I had significant financial arrangements to deal with; however, like I said, I got ZERO notice for my financial arrangements. They got six weeks for their larger financial arrangements.

None of this is fair. Life isn't fair. Six weeks may be a rather compressed time frame to move their inventory, but zero time is also a rather compressed time frame for me to do what I needed to do.

[mactastic]

But the problem isn't that they're just out of a job, it's that they now have (typically) several million dollars invested in inventory which becomes impossible to sell after their contract expires.
And what of those who got zero notice of a job loss, and had several hundred thousands of dollars invested in a house that they now are forced to sell at a significant loss or face foreclosure? Same boat, different scale.

Again, six weeks may be a tight time frame, but there are certain risks you take as a business owner -- or homeowner for that matter. Is it fair? Nope. Do businesses have an obligation to act in a manner perceived to be "fair" by their employees or franchisees? Nope.

They'll have a really hard time selling their stock when competing dealers have factory incentives and rebates and can offer a lower price...
Homeowners across the nation who've lost jobs are facing this same problem. If car dealers deserve (meaning someone -- likely government -- stepping in) help, why doesn't everyone else facing financial distress deserve help too?

[Rodimus Prime]

I had significant financial arrangements to deal with; however, like I said, I got ZERO notice for my financial arrangements. They got six weeks for their larger financial arrangements.

None of this is fair. Life isn't fair. Six weeks may be a rather compressed time frame to move their inventory, but zero time is also a rather compressed time frame for me to do what I needed to do.

I am with Mactastic. When i was laid off I got ZERO warning, no severance no nothing. All I got was my 14 days of vacation for the year.

I have my own finance to deal with and I had no time to make sure they were all in line. I was lucky I had a rather large savings built up so I did not have that panic.

As for anger at my former company I worked for. I am angery they lied to all their employees telling us how great everything was, how they had all these projects line up in the next year and would be going great. The company also talks how honesty and integrity is so important. Then they turn around and do a mass round of lay offs. The pretty much to me shoots any integrity the company had left in the foot.

It was known long before hand Chrysler would be doing this and most of the dealership who got it knew they where on the copping block.

[takao]

also it has to be considered that chrysler was close to bankruptcy already last year .. if i were a dealer i sure wouldn't let stock get out of hand .. also chrysler field bankruptcy in april so even then a dealer might be interested to reduce stock

also let's be realistic here .. those dealers sorted out are most likely those performing the worst over the last years or those too close to other dealers ... something which shouldn't be forgotten

[danny_w]

Would it be any different if Chrysler was voiding union contracts rather than dealership contracts? We've had quite a few people come through here arguing that all union contracts should be allowed to be voided, so why not dealership contracts?
BIG difference. Union contracts cost the company money in the form of wages and benefits, but the dealer doesn't cost the company a single solitary dime. I was watching live MSNBC video yesterday when the Chrysler CEO stated that canning the dealers was not a "money" thing. When the senators asked him why they were canning the dealers if it was not a "money" thing, MSNBC (or somebody) pulled the video feed. And now I can't find the video anywhere on their site.

[quagmire]

BIG difference. Union contracts cost the company money in the form of wages and benefits, but the dealer doesn't cost the company a single solitary dime. I was watching live MSNBC video yesterday when the Chrysler CEO stated that canning the dealers was not a "money" thing. When the senators asked him why they were canning the dealers if it was not a "money" thing, MSNBC (or somebody) pulled the video feed. And now I can't find the video anywhere on their site.

It is a customer satisfaction and inventory thing. They are right it is not much for a money thing. It is to reduce the dealers of competing against each other rather then competing against the competition. It is also to get rid of bad dealers who don't treat the customers right because it poorly reflects against Chrysler. If dealers can not sell the vehicles on the lot and have a big supply, it also means Chrysler can not run their factories at 100% capacity and lose productivity because of old inventory is still sitting on the lots.

[Demosthenes X]

Six weeks? That's almost unheard of! Most places give no notice when they lay people off.

Pulling a dealer franchise is not the same thing as laying off an employee. Most employees don't have hundreds of thousands of dollars worth of company inventory to sell off before it becomes illegal for them to do so. It's not the same thing.

Anyone who is laid off - or has their business pulled out from under them - deserves some sympathy. I'm not sure why that's so hard to extend...

An automobile IS STILL worth a lot of money.

Yup, you're screwed Mr Dealer because you wont get "full value" for it...but since you more than likely were holding the inventory on spec/hold for the manufacturer, you wont actually lose money, but probably break even.

Im not saying its a good thing this is happening, but its not as bad as people make it out to be.

Not as if these cars magically cant be driven anymore, or dont work, or arent brand new with the smell.

Do you have any idea how the dealer franchise system works? The dealer owns every one of those cars. They are not "holding" them for the manufacturer, they bought them at a given value. So when they sell them below cost, you better believe they're loosing money. And under the terms of the franchise agreement, it becomes illegal to sell them once that contract expires. That means, whether or not they have "new car smell", the dealer can't sell them once the contract is up.

So yeah, it is as bad as people say. The only reason you would think otherwise is because you're grossly misinformed as to how the system works.

[danny_w]

Pulling a dealer franchise is not the same thing as laying off an employee. Most employees don't have hundreds of thousands of dollars worth of company inventory to sell off before it becomes illegal for them to do so. It's not the same thing.

Anyone who is laid off - or has their business pulled out from under them - deserves some sympathy. I'm not sure why that's so hard to extend...



Do you have any idea how the dealer franchise system works? The dealer owns every one of those cars. They are not "holding" them for the manufacturer, they bought them at a given value. So when they sell them below cost, you better believe they're loosing money. And under the terms of the franchise agreement, it becomes illegal to sell them once that contract expires. That means, whether or not they have "new car smell", the dealer can't sell them once the contract is up.

So yeah, it is as bad as people say. The only reason you would think otherwise is because you're grossly misinformed as to how the system works.
Exactly, the dealer owns each and every car on his lot, he is not "holding" them for anybody. That is called floorplan financing, and means that the cars are financed by the dealer until the car is sold at retail. My father had a Chrysler dealership in the 70's and we did our floorplan through the local bank; they were glad for the business, much cheaper than Chrysler floorplanning, and much easier to work with.

[mactastic]

BIG difference. Union contracts cost the company money in the form of wages and benefits, but the dealer doesn't cost the company a single solitary dime. I was watching live MSNBC video yesterday when the Chrysler CEO stated that canning the dealers was not a "money" thing. When the senators asked him why they were canning the dealers if it was not a "money" thing, MSNBC (or somebody) pulled the video feed. And now I can't find the video anywhere on their site.
Then why close the dealers if they don't cost anything? :confused:

[danny_w]

Then why close the dealers if they don't cost anything? :confused:
That's what the senators were asking (repeatedly) when the video was pulled. Maybe somebody didn't want the public to know.

[mactastic]

Do you have any idea how the dealer franchise system works? The dealer owns every one of those cars. They are not "holding" them for the manufacturer, they bought them at a given value. So when they sell them below cost, you better believe they're loosing money. And under the terms of the franchise agreement, it becomes illegal to sell them once that contract expires. That means, whether or not they have "new car smell", the dealer can't sell them once the contract is up.
So you're saying that the dealer's contract (that they willingly signed) says that they will own hundreds of thousands -- if not millions -- of dollars of property that they cannot legally sell if their franchiser revokes their contract?

Why would anyone be dumb enough to sign on to a deal like that? :confused:

That's what the senators were asking (repeatedly) when the video was pulled. Maybe somebody didn't want the public to know.
Ahh... the tinfoil hat theory.

[Desertrat]

mac, there are two ways for dealers to "floorplan" their debt for new cars: Local bank financing, or through such as GMAC or FoMoCo Credit. I don't know today's numbers; it used to be 1% of the dealer's cost, per month, for local bank credit.

If Chrysler and GM have been financing at 1% per month, they're losing money by closing dealerships. Looks that way to me, anyhow.

The impact is on far more people than just the dealer. Figure how many salesmen, how many mechanics, how many clerical you see at your local dealer. Then figure the rent and taxes on the buildings, or what happens if there's a foreclosure of an un-sellable building. Then add in such items as advertising budgets no longer being spent, affecting local radio, TV and newspapers. The reduced spending then hits local governments' tax takes. These problems weren't envisioned by our fearless leaders inside the Beltway--as usual.

Something else: If Freddie Farmer or Randy Rancher has been driving Chevy or Dodge pickemups for forty forevers and it's now many miles to a dealer, he's likely to go visit Mr. Toyota or Mr. Nissan or Mr. Ford. That doesn't bode well for Government Motors Corporation.

'Rat

[yg17]

Something else: If Freddie Farmer or Randy Rancher has been driving Chevy or Dodge pickemups for forty forevers and it's now many miles to a dealer, he's likely to go visit Mr. Toyota or Mr. Nissan or Mr. Ford. That doesn't bode well for Government Motors Corporation.


I think most of the dealers that are closing are in large metro areas where there are many dealers. In St. Louis at least, you can pretty much throw a rock in any general direction and hit either a Ford, GM or Chrysler dealership and if your aim is a bit better, you'll hit one that sells all 3.

[maflynn]

I wouldn't say they're screwing dealers. They need to make some hard choices to survive and to be honest like GM their dealer network is to large, and cumbersome. Are there some dealers getting the short end of the stick, sure. I'm sure there are some that shouldn't close but are.

Its not a question of greed or money but of survival, they're on life-support and they need to do what ever they can to keep their head above water.

[danny_w]

I wouldn't say they're screwing dealers. They need to make some hard choices to survive and to be honest like GM their dealer network is to large, and cumbersome. Are there some dealers getting the short end of the stick, sure. I'm sure there are some that shouldn't close but are.

Its not a question of greed or money but of survival, they're on life-support and they need to do what ever they can to keep their head above water.
But how is closing dealers helping them do this? As stated already, it isn't costing them anything (moneywise) to have the dealers, and is actually costing them money to close the dealer in the form of lost floorplan money.

[mactastic]

mac, there are two ways for dealers to "floorplan" their debt for new cars: Local bank financing, or through such as GMAC or FoMoCo Credit. I don't know today's numbers; it used to be 1% of the dealer's cost, per month, for local bank credit.

If Chrysler and GM have been financing at 1% per month, they're losing money by closing dealerships. Looks that way to me, anyhow.
Now, admittedly, I don't know much about the ins-and-outs of how this relationship between dealers and manufacturers works, but something seems fishy here to me. First, why would a company force the closure of a dealership unless it was costing them money? I don't buy the "need to decrease competition" line. If the manufacturer is moving 1000 cars a month in a region, what do they care if that number is being moved by 10 dealers or 100 dealers? The manufacturer still makes the same amount, right? The only people forced closures help -- assuming those of you who say these dealerships aren't costing the manufacturer any money are correct -- are the remaining dealers who now get to see their sales volume increase.

Because I have a hard time seeing the manufacturer playing favorites with franchisees, that leads me to believe that the franchises do somehow cost the manufacturer money; thus their closure allows the manufacturer to save money. That's the only real motivator a corporation has, right?

The other thing that sounds fishy to me is how you can outright purchase property from an entity, and then not have the right to resell what then is YOUR property. Sure, a contract might play into this, but if that's the case -- and the dealers willingly signed that contract knowing the risks they were entering into -- then I can't really have any more sympathy for them than I would for someone who took on too much credit card debt without a plan for paying it off if their income disappeared. It's not like the dealers didn't know -- or should have known -- about that clause in their contract, and the rumors of bankruptcy and closing plants and dealerships have been swirling for months. If you've been taking orders for more inventory in that climate with no backup plan, why should anyone feel sorry for you -- or be forced to help you?

The impact is on far more people than just the dealer. Figure how many salesmen, how many mechanics, how many clerical you see at your local dealer. Then figure the rent and taxes on the buildings, or what happens if there's a foreclosure of an un-sellable building. Then add in such items as advertising budgets no longer being spent, affecting local radio, TV and newspapers. The reduced spending then hits local governments' tax takes. These problems weren't envisioned by our fearless leaders inside the Beltway--as usual.
Huhwhat? Did the government tell Chrysler to close these dealerships? My understanding is that that was a business decision made by private sector free-marketeers. Do you have any proof that the government forced this decision? I understand that the government said "you need to come up with a plan", but I don't recall them saying "you WILL close these specific dealerships".

And aren't you a proponent of simply allowing the free market to work it's magic, allowing these companies to fail completely? Wouldn't that also affect salesmen, clerical staff, property taxes, rent, foreclosures, etc.? Can I not also accuse the fearless free-marketeers of not envisioning these consequences just as easily as you've accused government? :confused:

Something else: If Freddie Farmer or Randy Rancher has been driving Chevy or Dodge pickemups for forty forevers and it's now many miles to a dealer, he's likely to go visit Mr. Toyota or Mr. Nissan or Mr. Ford. That doesn't bode well for Government Motors Corporation.
Isn't that how thefreemarket works?

I wouldn't say they're screwing dealers. They need to make some hard choices to survive and to be honest like GM their dealer network is to large, and cumbersome. Are there some dealers getting the short end of the stick, sure. I'm sure there are some that shouldn't close but are.

Its not a question of greed or money but of survival, they're on life-support and they need to do what ever they can to keep their head above water.
Exactly. Many people around the nation (and the world for that matter) are facing very similar situations due to companies needing to put their best interests above the best interests of their employees, and in this case their franchisees. It's not personal, it's not fair, and it's not like they want to go around "screwing" employees or dealers. I know my boss didn't *want* to let me go. It was strictly a business decision. Thus, I'm not out there whining about how he "screwed" me, or how "unfair" life is, and how someone owes me something as a result.

Dem's da breaks. Evolve or die off.

[Osarkon]

I'll admit I don't understand the whole system, but couldn't the dealers get around the inability to sell brand new cars by registering the cars to themselves, then the cars would have one previous owner, and possibly not be considered 'new'?

[rdowns]

I'll admit I don't understand the whole system, but couldn't the dealers get around the inability to sell brand new cars by registering the cars to themselves, then the cars would have one previous owner, and possibly not be considered 'new'?

That may be an option but wouldn't bode well for Chrysler dealers. The second owner would not get the lifetime power train warranty.

[Desertrat]

mac, I also don't see how dealers can be a cost to the manufacturer. If a dealer got all his financiing--building loan as well as floorplan--from the manufacturer and can't make his payments, yeah, shut him down. That seems like normalcy, to me. Otherwise? Why shut down any dealer who's paying his bills on time?

As for, "Did the government tell Chrysler to close these dealerships?", I don't see why this would have been done in the normal course of business--so I figure there's likely some sort of political deal involved. Nothing happens without a reason. But, I just don't know. I'm not surprised that an administration which rewards its friends (investment bank bailouts, benefitting those heavy campaign contributors) would punish its political enemies--and there are now lists floating about which name closed-down dealers who were large contributors to the Republican Party. That's nothing new, of course; both parties do that sort of thing.

What I do find somewhat amusing is that there are a lot of complaints in Congress by those with now-unemployed disgruntled voters "back home". Congress went along with the government takeover of GM and Chrysler without any idea of the consequences to what might be called the "outside world".

'Rat

[leekohler]

As for, "Did the government tell Chrysler to close these dealerships?", I don't see why this would have been done in the normal course of business--so I figure there's likely some sort of political deal involved. Nothing happens without a reason. But, I just don't know. I'm not surprised that an administration which rewards its friends (investment bank bailouts, benefitting those heavy campaign contributors) would punish its political enemies--and there are now lists floating about which name closed-down dealers who were large contributors to the Republican Party. That's nothing new, of course; both parties do that sort of thing.


'Rat

Oh please. I'd like proof of these assertions. Sounds very tin foil hat to me.

[mactastic]

That may be an option but wouldn't bode well for Chrysler dealers. The second owner would not get the lifetime power train warranty.
Doesn't bode well for people who bought houses in 2006 and 2007 that the real estate market is in the toilet right now either. Yeah, the dealer may have to take a loss on the sale. Such is life right now. But at least he won't lose the entire value of the vehicle. Perhaps he needs to take $5k off the price because it comes without a warranty. But he's no more entitled to break even on his sale than a homeowner who bought at the wrong time is.

I'm still having a hard time mustering any special sympathy above and beyond the level I have for everyone who's suffering the effects of this recession.

[mactastic]

mac, I also don't see how dealers can be a cost to the manufacturer. If a dealer got all his financiing--building loan as well as floorplan--from the manufacturer and can't make his payments, yeah, shut him down. That seems like normalcy, to me. Otherwise? Why shut down any dealer who's paying his bills on time?
That's what I'm asking you. You seemed to claim some expertise in the workings of this relationship when you commented that dealerships don't cost the manufacturer money.

Sounds like your only argument so far is that the manufacturer had it personally in for certain dealers, who also just happened to be the ones not performing as well as others, oddly enough.

As for, "Did the government tell Chrysler to close these dealerships?", I don't see why this would have been done in the normal course of business--so I figure there's likely some sort of political deal involved. Nothing happens without a reason. But, I just don't know. I'm not surprised that an administration which rewards its friends (investment bank bailouts, benefitting those heavy campaign contributors) would punish its political enemies--and there are now lists floating about which name closed-down dealers who were large contributors to the Republican Party. That's nothing new, of course; both parties do that sort of thing.
Ah, ok... so you're in the "tinfoil hat" crowd on this issue as well. I hesitate to ask if you have any actual proof of this, or is this just another of your gut feelings, much like your gut feeling that the poverty rate has gone up since LBJ's time?

What I do find somewhat amusing is that there are a lot of complaints in Congress by those with now-unemployed disgruntled voters "back home". Congress went along with the government takeover of GM and Chrysler without any idea of the consequences to what might be called the "outside world".
I find it amusing that you find that amusing. Again, didn't you advocate Congress just letting these businesses fail? Would that not have engendered complaints to Congress by those with now-unemployed disgruntled voters "back home" just as surely as this did?

And again, you assert that Congress had no idea of these consequences; but unless you've got some proof of that, I have to consider it to be just another opinion on your part -- and one that is not based in any kind of objective data. Can you provide proof that Congress didn't realize that additional job losses would occur if this bankruptcy went forward? Or is this just more of your corporatist worldview?

[gotzero]

The way cars are sold in the states, this actually is really bad for the closed dealers. They will have to sell on a short notice, and they will not have access to any of the factory incentives and rebates that are almost required in order for a dealer of an American car to sell the vehicle at a profit.

That said, once the dealer takes delivery, and they are not returnable, I fail to see how they can be legally forced to sell their inventory by a certain date.

[danny_w]

The way cars are sold in the states, this actually is really bad for the closed dealers. They will have to sell on a short notice, and they will not have access to any of the factory incentives and rebates that are almost required in order for a dealer of an American car to sell the vehicle at a profit.

That said, once the dealer takes delivery, and they are not returnable, I fail to see how they can be legally forced to sell their inventory by a certain date.
The inventory belongs to the dealer, but to sell them as new cars means that 1) they cannot have been registered AND 2) that the dealer be a bona-fide dealer on the date of sale. Point #1 is easy; any cars not yet sold have not been registered. Point #2 is the problem, since after the cutoff date the dealer will no longer be a bona-fide dealer. At least GM is giving the dealers until late next year to sell their inventory; Chrysler is not, and that is the major problem here.

[kavika411]

The inventory belongs to the dealer, but to sell them as new cars means that 1) they cannot have been registered AND 2) that the dealer be a bona-fide dealer on the date of sale. Point #1 is easy; any cars not yet sold have not been registered. Point #2 is the problem, since after the cutoff date the dealer will no longer be a bona-fide dealer. At least GM is giving the dealers until late next year to sell their inventory; Chrysler is not, and that is the major problem here.

It was much more fun speculating about how this process works until you step in and provide specific details. Thanks for blowing it for the rest of us. :p

You say: "to sell them as new cars." Does that mean that they could move forward with selling these as "used" cars? Yes, I realize people would likely pay less because of the "used" label, but I'm just curious if that is an option for them. I could envision a scenario where former dealers - in a massive, unified effort - start "used" Chryslers sales, getting the word out that they aren't actually used, and perhaps don't lose their shirts quite as badly. Just curious. Admittedly, I understand how none of this works.

[gotzero]

What about all of the exotic dealers that take odd new car inventory? Cars are still purchased with a warranty despite the fact that cars are not sold from a licensed dealer. Is this something specific to Chrysler?

This seems to me like a way to have the prices of these vehicles depressed, and to hurt both the closing dealers and the current dealers. I guess I am missing something.

[danny_w]

It was much more fun speculating about how this process works until you step in and provide specific details. Thanks for blowing it for the rest of us. :p

You say: "to sell them as new cars." Does that mean that they could move forward with selling these as "used" cars? Yes, I realize people would likely pay less because of the "used" label, but I'm just curious if that is an option for them. I could envision a scenario where former dealers - in a massive, unified effort - start "used" Chryslers sales, getting the word out that they aren't actually used, and perhaps don't lose their shirts quite as badly. Just curious. Admittedly, I understand how none of this works.
I assume that something like that could be worked out, but I don't know for sure; it may depend somewhat on state automobile registration regulations. I know some about how a dealership works because my dad owned a Chrysler dealership in the 70's in a small town in west Texas, and I helped as parts manager. We did our floorplanning through the local bank, but Chrysler still strong-armed us plenty, trying to force us to take more cars than we ordered, sending unsolicited "special" tools and then billing us, etc, etc, etc. I imagine that one reason some dealers have such large inventories is for the same reason we had to take cars we didn't want; Chrysler threatened to take away our franchise if we didn't take x number of cars (but really, how many can you sell in a town of 2000?). My dad finally had enough and told them he was not going to accept another car that he had not ordered. The big shots at Chrysler got really mad, but they relented.

[danny_w]

What about all of the exotic dealers that take odd new car inventory? Cars are still purchased with a warranty despite the fact that cars are not sold from a licensed dealer. Is this something specific to Chrysler?

This seems to me like a way to have the prices of these vehicles depressed, and to hurt both the closing dealers and the current dealers. I guess I am missing something.
It may depend somewhat on state automobile registration regulations, and so vary by state.

[takao]

You say: "to sell them as new cars." Does that mean that they could move forward with selling these as "used" cars? Yes, I realize people would likely pay less because of the "used" label, but I'm just curious if that is an option for them. I could envision a scenario where former dealers - in a massive, unified effort - start "used" Chryslers sales, getting the word out that they aren't actually used, and perhaps don't lose their shirts quite as badly. Just curious. Admittedly, I understand how none of this works.

this is how around sales numbers are sometimes "made look better" by dealers registering their stock cars for a single day and then selling them as so called "Tageswagen" (= translates to "One Day Car" roughly) with a rebate
somehow i'm surprised why US legislation doesn't allow that

[quagmire]

Now, admittedly, I don't know much about the ins-and-outs of how this relationship between dealers and manufacturers works, but something seems fishy here to me. First, why would a company force the closure of a dealership unless it was costing them money? I don't buy the "need to decrease competition" line. If the manufacturer is moving 1000 cars a month in a region, what do they care if that number is being moved by 10 dealers or 100 dealers? The manufacturer still makes the same amount, right? The only people forced closures help -- assuming those of you who say these dealerships aren't costing the manufacturer any money are correct -- are the remaining dealers who now get to see their sales volume increase.

Yeah, a sale is a sale, but it isn't a sale against Toyota, Honda, or Ford, but it is a sale for Bob Chevy against Bill Chevy. This creates an atmosphere that is bad for the consumer. It leads to the dealers giving away Chevy's at the lowest cost just so they can move inventory. It also creates high-pressure towards the consumer. Why do you think Saturn was such a success in this regard? They didn't have to worry about any of that. The salesmen didn't have to worry about selling the vehicles. Dealers didn't have to worry about competing against Saturn dealers because they were fewer of them. They could focus on the foreign competitors. The consumers didn't have to worry about haggling. Customer service was the main attraction at Saturn. It was working until GM decided to starve Saturn of product because Chevy got scared.

Having fewer dealers also improves the relationship GM has with those dealers. They can control what the dealers do better.

But, I still say automakers should be able to open corporate dealers. It gives them 100% control of the sale of their vehicles. No more mark up's of their vehicles because greedy dealers want to take advantage of the popularity of a model( especially in this economy). It gives them more control of closing down bad dealers.

[mactastic]

The inventory belongs to the dealer, but to sell them as new cars means that 1) they cannot have been registered AND 2) that the dealer be a bona-fide dealer on the date of sale. Point #1 is easy; any cars not yet sold have not been registered. Point #2 is the problem, since after the cutoff date the dealer will no longer be a bona-fide dealer. At least GM is giving the dealers until late next year to sell their inventory; Chrysler is not, and that is the major problem here.
Would you also suggest that homeowners facing foreclosure be given additional time to sell their homes?

[danny_w]

Would you also suggest that homeowners facing foreclosure be given additional time to sell their homes?
If they have never been late on a payment and it is not their fault, then yes. Remember, these dealers didn't do anything wrong like missed payments. Comparing this to foreclosed homes is not the same thing at all.

[quagmire]

If they have never been late on a payment and it is not their fault, then yes. Remember, these dealers didn't do anything wrong like missed payments. Comparing this to foreclosed homes is not the same thing at all.

If these dealers don't score high on their CSI( I believe that is what is called) and are not able to sell vehicles, then yes they did do something wrong as A) They have poor customer service B) Have an inability to sell vehicles at a productive rate.

[danny_w]

If these dealers don't score high on their CSI( I believe that is what is called) and are not able to sell vehicles, then yes they did do something wrong as A) They have poor customer service B) Have an inability to sell vehicles at a productive rate.
How ahve they done anything wrong that the company could gripe about? Every sale is a sale, and Chrysler gets their money no matter what the dealer sells it for. And if the dealer is floorplanned with them then that is extra income for Chrysler. The dealer also pays other fees and expenses throughout the year. How exactly is the dealer hurting Chrysler then?

[quagmire]

How ahve they done anything wrong that the company could gripe about? Every sale is a sale, and Chrysler gets their money no matter what the dealer sells it for. And if the dealer is floorplanned with them then that is extra income for Chrysler. The dealer also pays other fees and expenses throughout the year. How exactly is the dealer hurting Chrysler then?

If the dealers treat the customer poorly( which would be a low CSI score), a lot of them swear off Chrysler period because they think it reflects Chrysler's attitude on treating consumers( as many don't know the dealers are independent of the automakers). I have seen it a lot in person and on forums. So that is something Chrysler can gripe about......

Again, if dealers can't sell old inventory, Chrysler loses productivity and can't send new inventory to the dealers. It is always ideal to have your plants run at capacity. But, if dealers can't move old inventory, Chrysler can't.

[mactastic]

If they have never been late on a payment and it is not their fault, then yes. Remember, these dealers didn't do anything wrong like missed payments. Comparing this to foreclosed homes is not the same thing at all.
I'm not saying it's the exact same thing, I'm saying it's analogous.

I'm asking about homeowners who bought homes they could afford at the time, but due to a lost job or an illness or other extenuating circumstance beyond their control. Does anyone have an obligation to help them?

How ahve they done anything wrong that the company could gripe about? Every sale is a sale, and Chrysler gets their money no matter what the dealer sells it for. And if the dealer is floorplanned with them then that is extra income for Chrysler. The dealer also pays other fees and expenses throughout the year. How exactly is the dealer hurting Chrysler then?
That's what I want to know. Chrysler seems to think they'll save money by closing these dealerships. You and 'Rat seem to think that's not the case. I'm wondering if either of you can provide any reason as to why you think this, as Chrysler obviously thinks otherwise.

[danny_w]

I'm not saying it's the exact same thing, I'm saying it's analogous.

I'm asking about homeowners who bought homes they could afford at the time, but due to a lost job or an illness or other extenuating circumstance beyond their control. Does anyone have an obligation to help them?


That's what I want to know. Chrysler seems to think they'll save money by closing these dealerships. You and 'Rat seem to think that's not the case. I'm wondering if either of you can provide any reason as to why you think this, as Chrysler obviously thinks otherwise.
The Chrysler CEO said as much in the congressional hearing on Wed or Thur (I forget which). He said (and I quote) "It's not a money thing". When the congressman asked him point blank "Then why are you closing the dealerships" is when the video feed went dark. I'm not saying that means anything, but I would like to know how he answered the congressman.

[Desertrat]

mac, it's not tinfoil hattery about politicians rewarding friends and screwing enemies. Truly bi-partisan. Or businessmen, for that matter. Never been a time when it didn't happen. You forget Blago-baby already, or think he was unique?

"Chrysler seems to think they'll save money by closing these dealerships. You and 'Rat seem to think that's not the case."

No, I'm saying that I don't see the reason why they'd save money. They may be; I don't pretend to that high a level of expertise about the business dealings between dealers and manufacturers. I know a lot more about the repair and used-car side of the car business. I'll ask my "down the hill" buddy. He was a service manager at several dealerships during his working career; mostly Ford. He didn't care for my open-wheel racers, preferring Trans-Am Mustangs. :)

[Rodimus Prime]

That's what I want to know. Chrysler seems to think they'll save money by closing these dealerships. You and 'Rat seem to think that's not the case. I'm wondering if either of you can provide any reason as to why you think this, as Chrysler obviously thinks otherwise.

I think Chrysler is thinking long term. The market was over saturated with Chrysler dealships.

This drives the prices of Chrysler cars down ruins the image of the car few sells. Some dealerships fail because it.

For example Subway is a franchise and typically they do not allow new subways to be open with in a certain range of another subway. Not like the stores cost subway anything to have open.

It is a long term issue. The dealer network needed to be cut down. Plus it makes the other dealers shape up knowing if their service is scored badly they risk being on the copping block.

[Dmac77]

Six weeks? That's almost unheard of! Most places give no notice when they lay people off.

Exactly. These dealers just need to suck it up and deal with it. I have no sympathy for anyone who has been burned by the auto industry. Everyone has known for a long time now, that Chrysler and GM were going to fail. If people stayed around to go down with the ship, that's there own fault.

Don

[quagmire]

Exactly. These dealers just need to suck it up and deal with it. I have no sympathy for anyone who has been burned by the auto industry. Everyone has known for a long time now, that Chrysler and GM were going to fail. If people stayed around to go down with the ship, that's there own fault.

Don

Hmmm..... you know this how? You follow the industry at all or are you relying on the media's info for your insight( which is mostly Fox from the other thread which have always been against the helping of our own industries)? The media as you should know doesn't report the full truths. Regardless of what media site you think is biased or not, they don't provide anything more then what will sell their story. They didn't tell you GM started their restructuring back in 2005, they didn't tell you the only reason GM is in this situation is because of the financial crisis we are in now drained them of the cash they needed to fund the turnaround, and they certainly didn't tell you GM under its restructuring plan which was on track before this crisis was on track for them to pull a profit in the 2010 timeframe or so. There is so much more to the industries situation then you know. They also didn't tell you it was mostly Daimler that screwed Chrysler up. The media doesn't know nor reveal everything that has caused these automakers problems.

[takao]

They also didn't tell you it was mostly Daimler that screwed Chrysler up.

the overall lost money for Daimler with the now called "Chrysler Adventure" is estimated somewhere between 30-35 billion euros

[danny_w]

They also didn't tell you it was mostly Daimler that screwed Chrysler up.
I worked for a company once (ROLM) that was bought by a German company and pretty much the same thing happened. I hate to stereotype, but the Germans do not exactly have a brilliant track record of company takeovers; most have failed in mostly the same way. They always seem to think that they know the market better than the locals who have been running the company, and almost inevitably screw it up. In the few cases where they have taken a mostly hands-off approach (such as Siemens Medical) they have been successful. In my case (Siemens ROLM) they totally destroyed the company. Daimler followed the pattern exactly.

[kavika411]

Everyone has known for a long time now, that Chrysler and GM were going to fail.

Don

Can I assume, then, that you shorted their stock "for a long time now," made millions and contribute to MacRumors from the island you own in the South Pacific? I guess I'm jealous of you and "everyone" because I didn't know "for a long time now," and didn't likewise short the market.

[leekohler]

mac, it's not tinfoil hattery about politicians rewarding friends and screwing enemies. Truly bi-partisan. Or businessmen, for that matter. Never been a time when it didn't happen. You forget Blago-baby already, or think he was unique?

"Chrysler seems to think they'll save money by closing these dealerships. You and 'Rat seem to think that's not the case."

No, I'm saying that I don't see the reason why they'd save money. They may be; I don't pretend to that high a level of expertise about the business dealings between dealers and manufacturers. I know a lot more about the repair and used-car side of the car business. I'll ask my "down the hill" buddy. He was a service manager at several dealerships during his working career; mostly Ford. He didn't care for my open-wheel racers, preferring Trans-Am Mustangs. :)

You made specific claims bout which dealers were closed, that's what's tin foil about it. You stated something about dealers who gave cash to the Republican party being closed. Please provide proof of that claim. I don't buy it.

[bobber205]

I"m sure you guys know that the majority of dealerships closed donated to the GOP right?

;)

[mactastic]

mac, it's not tinfoil hattery about politicians rewarding friends and screwing enemies. Truly bi-partisan. Or businessmen, for that matter. Never been a time when it didn't happen. You forget Blago-baby already, or think he was unique?
It's tinfoil hattery to claim government conspiricy theories without proof, which is exactly what you have done. Again, please provide proof that dealerships facing closure were all GOP donors; and that conversely, dealers who donated to Dems were allowed to stay open. Also further that this was the driving factor, and doesn't simply correlate with poor dealership performance. Not to mention that the Obama administration demanded this of the manufacturers.

Otherwise you're just engaging in rank speculation of the tinfoil hat variety.

"Chrysler seems to think they'll save money by closing these dealerships. You and 'Rat seem to think that's not the case."

No, I'm saying that I don't see the reason why they'd save money. They may be; I don't pretend to that high a level of expertise about the business dealings between dealers and manufacturers.
Well, businesses don't typically cut off sales avenues that aren't costing them money. Even if all they're doing is breaking even on the sales outlet, it's still an outlet that allows them to keep an increased volume going, thus justifying plant production levels etc.

The only reason it makes sense for a company to shut down a sales outlet is if it's losing them money.

I know a lot more about the repair and used-car side of the car business. I'll ask my "down the hill" buddy. He was a service manager at several dealerships during his working career; mostly Ford. He didn't care for my open-wheel racers, preferring Trans-Am Mustangs. :)
Can't hurt.

I think Chrysler is thinking long term. The market was over saturated with Chrysler dealships.

This drives the prices of Chrysler cars down ruins the image of the car few sells. Some dealerships fail because it.

For example Subway is a franchise and typically they do not allow new subways to be open with in a certain range of another subway. Not like the stores cost subway anything to have open.

It is a long term issue. The dealer network needed to be cut down. Plus it makes the other dealers shape up knowing if their service is scored badly they risk being on the copping block.
This may be true, but these companies are desperately looking for ways to cut costs right now, which seems like a much more powerful motivator than any long-term plan. Still, maybe they're able to take advantage of the bankruptcy proceeding to make this long-term strategic goal that would have been impossible under normal operating circumstances. That would make sense, but I've seen nothing concrete from anyone here yet. Just a lot of speculation -- with some tinfoil hattery thrown in for S's and G's.

[Blue Velvet]

tinfoil hattery


There is just one problem with this theory. Nobody has bothered to look up data for the control group: the list of dealerships which aren't being closed. It turns out that all car dealers are, in fact, overwhelmingly more likely to donate to Republicans than to Democrats -- not just those who are having their doors closed.

http://www.fivethirtyeight.com/2009/05/news-flash-car-dealers-are-republicans.html

Overall, 88 percent of the contributions from car dealers went to Republican candidates and just 12 percent to Democratic candidates. By comparison, the list of dealers on Doug Ross's list (which I haven't vetted, but I assume is fine) gave 92 percent of their money to Republicans -- not really a significant difference.

There's no conspiracy here, folks -- just some bad math.


http://www.fivethirtyeight.com/2009/05/on-moon-landings-michelle-malkin-p.html

At the end of the day, people are going to believe what they want to believe: some people believe that the moon landing was faked, that 9/11 was a grand conspiracy, and that Barack Obama was born in Indonesia. There is no evidence for any of these claims, but that doesn't stop tens of millions of people from believing them! Dealergate, particularly in its original formulation (that Obama was punishing Republican donors with the Chrysler closings), is in largely the same category.


So, let me get this straight. The people that believe this silly idea are the people we're supposed to listen to about the economy?

[leekohler]

http://www.fivethirtyeight.com/2009/05/news-flash-car-dealers-are-republicans.html



http://www.fivethirtyeight.com/2009/05/on-moon-landings-michelle-malkin-p.html




So, let me get this straight. The people that believe this silly idea are the people we're supposed to listen to about the economy?

So much for 'rat's conspiracy theory.

[stevento]

GM and Chrysler -and subway for that matter- are both suffering from what I like to call the "starbucks syndrome." They were handing out franchises to anybody who wanted one, then realized they are hurting sales by having too many.

[mactastic]

So, let me get this straight. The people that believe this silly idea are the people we're supposed to listen to about the economy?
Heh... indeedy.

Never let facts get in the way of a good Democrats-are-out-to-get-us conspiracy theory!

Although I wouldn't hold your breath waiting for 'Rat to acknowledge said facts.

[leekohler]

Although I wouldn't hold your breath waiting for 'Rat to acknowledge said facts.

Well, that would just be silly. :)

[mactastic]

GM and Chrysler -and subway for that matter- are both suffering from what I like to call the "starbucks syndrome." They were handing out franchises to anybody who wanted one, then realized they are hurting sales by having too many.
Hey look... more speculation without any proof! Seems to be the sum total of this thread.

Look, I'm not saying this isn't the case, but can you provide any EVIDENCE that what you like to call the "Starbucks syndrome" A) is real, and B) was the driving force behind Chrysler's decision to close these dealerships?

[Blue Velvet]

Never let facts get in the way


We will be greeted as liberators. Cutting taxes raises revenue...

Socialist!


http://correspondents.theatlantic.com/conor_clarke/socialism%20chart.png



http://correspondents.theatlantic.com/conor_clarke/2009/06/what_socialism_looks_like.php

[Desertrat]

Some info about the cost to manufacturers to have franchised dealers:

First off, the salaries of sales reps, service reps and parts reps--plus travel expenses. Then there's the internal clerical cost of record keeping for the cars and for the parts. Records and analysis for warranty work.

Dealers are expected to be competent enough to do a certain amount of market penetration. To create "Ford Country" and suchlike. This is monitored and analyzed by the manufacturer. Dealer sales of wholesale parts are monitored, to see if the sales indicate an adequate amount of business with independent garages, and that's more record keeping and data gathering--which costs.

"Weak sisters" are being weeded out. Another group is the dealers who not only sell GM or Chrysler cars, but other brands as well. These dealers are regarded as "skimmers" who sell a lot of cars but don't focus on market penetration for GM or Chrysler.

Anyhow, that's just off the top of my buddy's head, for a quickie rundown.

'Rat

[stevento]

Socialist!
http://correspondents.theatlantic.com/conor_clarke/2009/06/what_socialism_looks_like.php

yeah but to nationalize GM is totally different then nationalizing, say a small business. Remember why we're doing this bailouts. Because if these companies fail, the economy will go into tailspin. They are so connected to our economy as a whole, and now the government has the controlling interest in that.
So let's say two years from now, GM decides to discontinue the GMC Canyon. I could write a letter to my congressman telling him why I think this is wrong. Because really our government has final say in all of this. This introduces lots of problems. The government having control of this is isn't a good thing, perhaps a necessary evil.

[quagmire]

yeah but to nationalize GM is totally different then nationalizing, say a small business. Remember why we're doing this bailouts. Because if these companies fail, the economy will go into tailspin. They are so connected to our economy as a whole, and now the government has the controlling interest in that.
So let's say two years from now, GM decides to discontinue the GMC Canyon. I could write a letter to my congressman telling him why I think this is wrong. Because really our government has final say in all of this. This introduces lots of problems. The government having control of this is isn't a good thing, perhaps a necessary evil.

Government ownership will not be forever. An IPO will eventually be issued and GM will be a private company again.

[yg17]

The government is going to have a very hands-off approach when it comes to running GM and Chrysler and will only get involved in major business decisions. Barack Obama isn't going to have to sign off on GM making power windows standard equipment in a Cobalt :rolleyes:

[quagmire]

The government is going to have a very hands-off approach when it comes to running GM and Chrysler and will only get involved in major business decisions. Barack Obama isn't going to have to sign off on GM making power windows standard equipment in a Cobalt :rolleyes:

If any decisions at all..... The only thing Obama will be doing in regards of business within GM is replacing the board of directors. When it comes to products, that is still under 100% GM control.

[Eraserhead]

GM and Chrysler -and subway for that matter- are both suffering from what I like to call the "starbucks syndrome." They were handing out franchises to anybody who wanted one, then realized they are hurting sales by having too many.

Actually, certainly the latter two just make average quality overpriced sandwiches and coffees.

[mactastic]

Some info about the cost to manufacturers to have franchised dealers:

First off, the salaries of sales reps, service reps and parts reps--plus travel expenses. Then there's the internal clerical cost of record keeping for the cars and for the parts. Records and analysis for warranty work.
Ok, now we're getting somewhere. So these dealerships do appear to have a cost to the manufacturer. Fewer manufacturers, fewer clerical costs to track their performance? Still, that doesn't seem like a major cost in the big scheme of things; particularly if you assume the number of sales isn't going to change dramatically, just fewer sources of sales.

Dealers are expected to be competent enough to do a certain amount of market penetration. To create "Ford Country" and suchlike. This is monitored and analyzed by the manufacturer. Dealer sales of wholesale parts are monitored, to see if the sales indicate an adequate amount of business with independent garages, and that's more record keeping and data gathering--which costs.
So again, more costs -- but I don't really see the manufacturers saving a hell of a lot of money by cutting out a rather small percentage of their clerical work. Certainly not enough to return them to profitability.

"Weak sisters" are being weeded out. Another group is the dealers who not only sell GM or Chrysler cars, but other brands as well. These dealers are regarded as "skimmers" who sell a lot of cars but don't focus on market penetration for GM or Chrysler.
The more I think about this, the more it seems that the most likely answer is that bankruptcy proceedings give the manufacturers the flexibility to make some moves that they've long wanted to, but have been unable to accomplish due to existing contracts in place. For the life of me, I can't find any significant short-term cost to the manufacturer that would be saved by these closings.

yeah but to nationalize GM is totally different then nationalizing, say a small business. Remember why we're doing this bailouts. Because if these companies fail, the economy will go into tailspin. They are so connected to our economy as a whole, and now the government has the controlling interest in that.
So let's say two years from now, GM decides to discontinue the GMC Canyon. I could write a letter to my congressman telling him why I think this is wrong. Because really our government has final say in all of this. This introduces lots of problems. The government having control of this is isn't a good thing, perhaps a necessary evil.
You could have written a letter to your congressperson a year ago and complained to them about some aspect of GM's product line -- and it would have had the same effect as it will next year -- zilch.

[rdowns]

O
You could have written a letter to your congressperson a year ago and complained to them about some aspect of GM's product line -- and it would have had the same effect as it will next year -- zilch.


He was in mourning. Hillary dropped out a year ago today. :D

[yg17]

He was in mourning. Hillary dropped out a year ago today. :D

Wow, it's been a year already? It seems like just yesterday I was watching her give her gracious and wonderful concession speech. A year later and he still hasn't gotten over it...damn.