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Chrysler shuts down all production - Dec. 17, 2008
Now's the time to buy a Dodge if you're looking. I hear some dealers are practically giving them away! I wish that had happened when I bought my Caliber!Quote:
Chrysler LLC announced late Wednesday that it is stopping all vehicle production in the United States for at least a month.
Feel free to discuss anything about Chrysler, Cerberus Group, or the Big 3.
Lets hope its only a month!God help us!
Not commenting on whether this is a good or a bad thing, but it's about time certain companies start learning from their mistakes. I read a great chainletter (I know right- a great chainletter is something that I thought didn't exist) recently about this whole state of affairs and I agreed wholeheartedly with it. If anyone cares to read it I will post. It's lengthy though!
Go for it:tu
I can only hope that this is grave enough to convince the companies that change is needed, and the unions that they need to stop playing the entitlement game. This is not a time for them to start moaning, but instead seeing the big picture. If they throw a spanner in the wheels now instead of doing their best to help things turn around, Chrysler will indeed go the way of the dodo. That would be very bad indeed.
Here is the letter as promised. The first letter is 'supposedly' from the President of GM followed by an amazing response from whoever the person is- who knows if he's even real. Regardless, he nails it...
Abridged letter from Troy Clarke, President of General Motors:
Dear Employee, Next week, Congress and the current Administration will determine whether to provide immediate support to the domestic auto industry to help it through one of the most difficult economic times in our nation's history. Your elected officials must hear from all of us now on why this support is critical to our continuing the progress we began prior to the global financial crisis......................As an employee, you have a lot at stake and continue to be one of our most effective and passionate voices. I know GM can count on you to have your voice heard.Thank you for your urgent action and ongoing support.Troy Clarke
President
General Motors North America~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~
From Gregory Knox:
In response to your request to call legislators and ask for a bailout for the United States automakers please consider the following, and please also pass this onto Troy Clarke, the president of General Motors North America for me. You are both infected with the same entitlement mentality that has bred like cancerous germs in UAW halls for the last countless decades, and whose plague is now sweeping the nation, awaiting our new "messiah" to wave his magical wand and make all our problems go away, while at the same time allowing our once great nation to keep "living the dream"…
The dream is over! The dream that we can ignore the consumer for years while management myopically focuses on its personal rewards packages at the same time that our factories have been filled with the worlds most overpaid, arrogant, ignorant and laziest entitlement minded "laborers" without paying the price for these atrocities…and that still the masses will line up to buy our products Don't tell me I'm wrong. Don't accuse me of not knowing of what I speak. I have called on Ford, GM, Chrysler, TRW, Delphi, Kelsey Hayes, American Axle and countless other automotive OEM's and Tier ones for 3 decades now throughout the Midwest and what I've seen over the years in these union shops can only be described as disgusting.
Mr Clarke, the president of General Motors, states:There is widespread sentiment in this country, our government and especially in the media that the current crisis is completely the result of bad management. It is not…
You're right – it's not JUST management…how about the electricians who walk around the plants like lords in feudal times, making people wait on them for countless hours while they drag ass…so they can come in on the weekend and make double and triple time…for a job they easily could have done within their normal 40 hour week How about the line workers who threaten newbies with all kinds of scare tactics…for putting out too many parts on a shift…and for being too productive (mustn't expose the lazy bums who have been getting overpaid for decades for their horrific underproduction, must we?!?) Do you really not know about this stuff?!? How about this great sentiment abridged from Mr. Clarke's sad plea:over the last few years …we have closed the quality and efficiency gaps with our competitors. What the hell has Detroit been doing for the last 40 years?!? Did we really JUST wake up to the gaps in quality and efficiency between us and them?
The K car vs. the Accord?
The Pinto vs. the Civic?!?
Do I need to go on? We are living through the inevitable outcome of the actions of the United States auto industry for decades. Time to pay for your sins, Detroit. I attended an economic summit last week where a brilliant economist, AlanBeaulieu surprised the crowd when he said he would not have given the banks a penny of "bailout money". Yes, he said, this would cause short term problems, but despite what people like George Bush and Troy Clarke would have us believe, the sun would in fact rise the next day… and something else would happen… where there had been greedy and sloppy banks new efficient ones would pop up… that is how a free market system works… it does work… if we would let it work…
But for some reason we are now deciding that the rest of the world is right and that capitalism doesn't work – that we need the government to step in and "save us"…save us, hell – we're nationalizing…and unfortunately too many of this once fine nations citizens don't even have a clue that this is what's really happening…but they sure can tell you the stats on their favorite sports teams…yeah – like THAT'S important… Does it occur to ANYONE that the "competition" has been producing vehicles, EXTREMELY PROFITABLY, for decades now in this country?...How can that be??? Let's see…Fuel efficient… Listening to customers… Investing in the proper tooling and automation for the long haul… Not being too complacent or arrogant to listen to Dr W Edwards Deming 4 decades ago Ever increased productivity through quality, lean and six sigma plans… Treating vendors like strategic partners, rather than like "the enemy"… Efficient front and back offices…Non union environment… Again, I could go on and on, but I really wouldn't be telling anyone anything they really don't already know in their hearts I have six children, so I am not unfamiliar with the concept of wanting someone to bail you out of a mess that you have gotten yourself into – my children do this on a weekly, if not daily basis, as I did at their age. I do for them what my parents did for me (one of their greatest gifts, by the way) – I make them stand on their own two feet and accept the consequences of their actions and work them through. Radical concept, huh…? Am I there for them in the wings? Of course – but only until such time as they need to be fully on their own as adults I don't want to oversimplify a complex situation, but there certainly are unmistakable parallels here between the proper role of parenting and government. Detroit and the United States need to pay for their sins. Bad news people – it's coming whether we like it or not The newly elected Messiah really doesn't have a magic wand big enough to "make it all go away" I laughed as I heard Obama "reeling it back in" almost immediately after the vote count was tallied…"we might not do it in a year…or in four…" where was that kind of talk when he was RUNNING for the office Stop trying to put off the inevitable … That house in Florida really isn't worth $750,000…Invaders who jump across a border really don't deserve free health care benefits… That job driving that forklift for the big 3 really isn't worth $85,000 a year… We really shouldn't allow Wal-Mart to stock their shelves with products acquired from a country that unfairly manipulates their currency and has the most atrocious human rights infractions on the face of the globe… That couple whose combined income is less than $50,000 really shouldn't be living in that $485,000 home… Let the market correct itself people – it will. Yes it will be painful, but it's gonna be painful either way, and the bright side of my proposal is that on the other side of it is a nation that appreciates what is has…and doesn't live beyond its means…and gets back to basics…and redevelops the work ethic that made it the greatest nation in the history of the world…Sorry – don't cut my head off, I'm just the messenger sharing with you the "bad news"
Teriffic letter.
this is the only part I didn't agree with. If it's a free market it's a free market and you shouldn't block products based on how it was produced. You should let the market run it's course, make the production methods known and let the company die.Quote:
Originally Posted by Philadelph
Indeed. Sheltering the companies from competition is the root cause of the problem.
Instead of being angry at people who drive japanese cars and keying their cars (something that is apparently perfectly acceptable in detroit), people should be angry at gm, ford and chrysler, demanding they make better cars.
Very true. Stop whining and improve your own game instead of telling people that it's "not fair because they're better"
This is what I think about this too.Quote:
Originally Posted by Philadelph
Bush has decided to give the Big Three just enough money to make it to the next round of begging in January
He also said the automakers must pay it back by March if they cannot prove their viability. :shrug:Quote:
"Allowing the U.S. auto industry to collapse is not a responsible course of action," President Bush said Friday morning.
The correct quote would be:Quote:
Originally Posted by Bush
:wQuote:
Originally Posted by Bush
I've been saying for the last 7 years that ignoring Deming was the dumbest thing the Big 3 ever did, I'm glad to see that I'm not the only one who thinks that.
How can anyone think otherwise? Deming's ways are so obviously beneficial, even to math averse people. When being more efficient is punished, you know there's a problem.
Agreed, but you should also check out the movie 'Wal-Mart: The High Cost of Low Prices'. Terrible company. I don't see how some of the stuff they do isn't criminal.Quote:
Originally Posted by LX_Emergency
I'm in the market for a car - so are a lot of my friends and colleagues - but are we going to buy from the big 3? Nope - and why not you ask? Because we all currently have GM/Ford/Chrysler cars, and we've had nothing but problems - not manufacturing defects mind you, but ENGINEERING defects.
Who puts a paper head gasket in a car's engine to save 20 cents over a metal one but that you know will crap out in 5 years to the tune of $1300 installed? Who designs a wheel bearing that will fail after 80k miles when you can design one in 10 minutes that will outlast the car? For that matter, why go to a sealed bearing when a packed bearing costs 14$ in grease to repack/replace instead of the $400 sealed bearing? Why do GM transmissions always grind, skip, thomp, and break? Why do Fords have a helluva time starting in the cold? Why do Chrysler engine rods bend?
The bigger question, though, is why is it that Toyota and Honda's don't? I'll pay the extra $3000 to ensure the car will last 10+ years. I also don't buy that the big 3 have closed the efficiency/reliability gap.
Just my 0.02 - but I can tell you that I know a lot of people getting cars, and very few are getting north american brands (my family has been an American car family for decades...so it actually pains me).
Mark
I hate those sealed bearings...they're such a pain and so expensive. I'm about to repack mine for new rotors and they still look great.
I think there are certain models from certain manufacturers that are worth buying, but others just seem to be trash. Now's the best time to be buying though- I hear a lot of dealers are practically giving cars away. Someone told me that some dealers in Canadia (yes, Canadia :w) are doing buy one get one free with Avengers and Calibers. I'd take 'em up on that.
exactly. and as a math person, it was rather embarassing to hear how he was treated in america after the war. so deming, being nobody's fool, hops a boat to japan where he gets listened to, and lo and behold! the japanese manufacturing industry was stomping us flat in no time. what a shock.Quote:
Originally Posted by Quick Orange
and people wonder why a honda will outlast a ford by a decade or two. one word: deming.
It's extremely embarrassing! You would think that after rationing, etc., plus that being the generation of the Depression, people would have been more open to him. Coulda, shoulda, woulda I suppose.
What I find telling though is that even after his methods had been proven, the Big 3 still ignored them. They could have produced more parts with lower tolerances, meaning both a cheaper and better vehicle. American designs were far better than Japanese (in my opinion) for a long time, so they could have easily caught up to and exceeded Japan. Dare I say it, we could have been on a German level. Instead, let's have sloppy tolerances and lax quality control. The American way...:rolleyes:
Sad thing!
I live in Southern Germany, a region heavily affected by the automobile industry (Mercedes and Porsche have their HQs just a few miles away). In know many people that work either at the companies itself or at suppliers.
For all the workers, I hope the market can regroup in some way.
Ah, by the way, my family owns Fords since I can think. They were very reliable, but these were those European Models produced here.
Don't know much about the technique and stuff from models produced in the US.
Well, Ford said no to the current Detroit bailout. I must say that they've risen a notch in my book. Let's see if it's just a show or if they really mean business.
Ummm. didn't Toyota just halt construction on a huge prius plant here that was almost finished? because they don't know where the car market is headed?
They're going to finish the building, they just aren't going to be installing the machines. This is mainly because their stock is just sitting at the ports with nowhere to go. Also, the plant wasn't going to be actually producing until late 2010. They're still producing elsewhere, whereas Chrysler has shut down all production for a month.
(haha, I'm replying to my own post... :eek:)Quote:
Originally Posted by Quick
Seems to me that a lot of people are the car companies being entirely responsible for their own problems now. True they may not have planned for the current crisis and they may not have been trimming down effeciency wise when it didn't look as if they would have to, but you could make the same argument for all the people losing their houses right? I think pretty much everything in the economy gambles on other parts. I think it would be tough to say "We should be preparing for the remote possibility of a lending crisis the likes of which we've never seen before".
It's not surprising that the auto industry was hit first and the hardest. So far. For the average American, buying a car is the second largest purchase they will make in their lives after their house. Lots of people don't own a house so it is the largest purchase they make in their lives. Loads of people are currently losing their houses. Not so surprising no one is buying cars right? And it's not just the American cars. See above.
Not saying I agree with the below but there is always more than one side. This is a letter to the editor from a Ford dealer in the Pittsburgh area.
Quote:
Editor:
As I watch the coverage of the fate of the U.S. auto industry, one alarming and frustrating fact hits me right between the eyes. The fate of our nation's economic survival is in the hands of some congressmen who are completely out of touch and act without knowledge of an industry that affects almost every person in our nation. The same lack of knowledge is shared with many journalists whom are irresponsible when influencing the opinion of
millions of viewers.
Sen. Richard Shelby of Alabama has doomed the industry, calling it a dinosaur. No Mr. Shelby, you are the dinosaur, with ideas stuck in the '70s, '80s and '90s. You and the uninformed journalist and senators that hold onto myths that are not relevant in today's world.
When you say that the Big Three build vehicles nobody wants to buy, you must have overlooked that GM outsold Toyota by about 1.2 million vehicles in the U.S. and Ford outsold Honda by 850,000 and Nissan by 1.2 million in the U.S. GM was the world's No. 1 automaker beating Toyota by 3,000 units.
When you claim inferior quality comes from the Big Three, did you realize that Chevy makes the Malibu and Ford makes the Fusion that were both rated over the Camry and Accord by J.D. Power independent survey on initial quality? Did you bother to read the Consumer Report that rated Ford on par with good Japanese automakers.
Did you realize Big Three's gas guzzlers include the 33 mpg Malibu that beats the Accord. And for '09 Ford introduces the Hybrid Fusion whose 39 mpg is the best midsize, beating the Camry Hybrid. Ford's Focus beats the Corolla and Chevy's Cobalt beats the Civic.
When you ask how many times are we going to bail them out you must be referring to 1980. The only Big Three bailout was Chrysler, who paid back $1 billion, plus interest. GM and Ford have never received government aid.
When you criticize the Big Three for building so many pickups, surely you've noticed the attempts Toyota and Nissan have made spending billions to try to get a piece of that pie. Perhaps it bothers you that for 31 straight years Ford's F-Series has been the best selling vehicle. Ford and GM have dominated this market and when you see the new '09 F-150 you'll agree this won't change soon.
Did you realize that both GM and Ford offer more hybrid models than Nissan or Honda. Between 2005 and 2007, Ford alone has invested more than $22 billion in research and development of technologies such as Eco Boost, flex fuel, clean diesel, hybrids, plug in hybrids and hydrogen cars.
It's 2008 and the quality of the vehicles coming out of Detroit are once again the best in the world.
Perhaps Sen. Shelby isn't really that blind. Maybe he realizes the quality shift to American. Maybe it's the fact that his state of Alabama has given so much to land factories from Honda, Hyundai and Mercedes Benz that he is more concerned about their continued growth than he is about the people of our country. Sen. Shelby's disdain for "government subsidies" is very hypocritical. In the early '90s he was the driving force behind a $253 million incentive package to Mercedes. Plus, Alabama agreed to purchase 2,500 vehicles from Mercedes. While the bridge loan the Big Three is requesting will be paid back, Alabama's $180,000-plus per job was pure incentive. Sen. Shelby, not only are you out of touch, you are a self-serving hypocrite, who is prepared to ruin our nation because of lack of knowledge and lack of due diligence in making your opinions and decisions.
After 9/11, the Detroit Three and Harley Davidson gave $40 million-plus emergency vehicles to the recovery efforts. What was given to the 9/11 relief effort by the Asian and European Auto Manufactures? $0 Nada. Zip!
We live in a world of free trade, world economy and we have not been able to produce products as cost efficiently. While the governments of other auto producing nations subsidize their automakers, our government may be ready to force its demise. While our automakers have paid union wages, benefits and legacy debt, our Asian competitors employ cheap labor. We are at an extreme disadvantage in production cost. Although many UAW concessions begin in 2010, many lawmakers think it's not enough.
Some point the blame to corporate management. I would like to speak of Ford Motor Co. The company has streamlined by reducing our workforce by 51,000 since 2005, closing 17 plants and cutting expenses. Product and future product is excellent and the company is focused on one Ford. This is a company poised for success. Ford product quality and corporate management have improved light years since the nightmare of Jacques Nasser. Thank you Alan Mulally and the best auto company management team in the business.
The financial collapse caused by the secondary mortgage fiasco and the greed of Wall Street has led to a $700 billion bailout of the industry that created the problem. AIG spent nearly $1 million on three company excursions to lavish resorts and hunting destinations. Paulson is saying no to $250 billion foreclosure relief and the whole thing is a mess. So when the Big Three ask for 4 percent of that of the $700 billion, $25 billion to save the country's largest industry, there is obviously oppositions. But does it make sense to reward the culprits of the problem with $700 billion unconditionally, and ignore the victims?
As a Ford dealer, I feel our portion of the $25 billion will never be touched and is not necessary. Ford currently has $29 billion of liquidity. However, the effect of a bankruptcy by GM will hurt the suppliers we all do business with. A Chapter 11 bankruptcy by any manufacture would cost retirees their health care and retirements. Chances are GM would recover from Chapter 11 with a better business plan with much less expense. So who foots the bill if GM or all three go Chapter 11? All that extra health care, unemployment, loss of tax base and some forgiven debt goes back to the taxpayer, us. With no chance of repayment, this would be much worse than a loan with the intent of repayment.
So while it is debatable whether a loan or Chapter 11 is better for the Big Three, a $25 billion loan is
definitely better for the taxpayers and the economy of our country.
So I'll end where I began on the quality of the products of Detroit. Before you, Mr. or Ms. Journalist continue to misinform the American public and turn them against one of the great industries that helped build this nation, I must ask you one question. Before you, Mr. or Madam Congressman vote to end health care and retirement benefits for 1 million retirees, eliminate 2.5 million of our nation's jobs, lose the technology that will lead us in the future and create an economic disaster including hundreds of billions of tax dollars lost, I ask this question not in the rhetorical sense. I ask it in the sincere, literal way. Can you tell me, have you driven aFord lately?
Jim Jackson
Elkins
I think both the mortgage problem and this auto industry problem can be summed up by two words: bad business. There were a lot of people getting houses and mortgages they couldn't afford. The car industry may have started getting better in the last couple years, but prices have also dramatically risen.
I find it funny that the guy references a Focus vs a Corolla and a Cobalt vs a Civic. I would hardly think they are on the same playing field. I've driven both new Cobalts and Civics, and there's a big difference between the two. The Civic has much more room, as well as sounds and feels like a quality vehicle. Cobalts are nice, but the space inside is smaller, and it feels and sounds like a cheaply made entry level vehicle. I've not driven a Focus or Corolla, but I know the Corolla is bigger.
I wish I could write a letter back to this guy:gaah:
Anyway, more interesting news. Canada is helping bail out GM and Chrysler. Naturally GM is getting more money. Bloomberg.com: Worldwide
But at least you have cupholders and soggy suspension :roflmaoQuote:
Originally Posted by Quick Orange
But I think the problem is that the Big 3 assumed they would never get any real competition. So they assumed that people wouldn't have a choice, and even if they did, hey would choose 'American', as if 'American' had any real value by itself.
History has shown enough times that protectionism and nationalism always lead to failure when it comes to economy.
I dont really understand why the big 3 get so much crap. I have a 13 year old Ford Escort that runs great, I get 32 hwy and 27 city. I maintain it myself and do as much of the work as possible. The reason so many cars get crappy milage is because everyone wants all the bells and wistles in the car which add weight and kill milage. I am utterly amazed at how many people at my school dont even know how to change their oil. It is sad that things like this are not taught in school anymore(they werent when I was in school, I learned on my own and from my dad).
chrysler isn't shutting down for a month, they are just extending their 2-week holiday shut down that happens every year for an extra 2 weeks to attempt to save some money.
Being American does have value in itself, but only to a point. Assuming everything was equal in a domestic and foreign car, I'd pick the domestic (even though it was probably built in Canada anyway). I agree about protectionism. As much as it hurts sometimes to not tariff the hell out of imports, it's the best way to go.Quote:
Originally Posted by Bruno
Akady, the reason they get so much crap is two-fold. First, they could be doing better. Japanese companies can build a higher quality car, ship it halfway around the world, sell it cheaper, and give a better warranty. The Big 3 have an automatic proximity advantage, but we don't see them using it. Instead, they jack their prices way up then give "incentives". No one should be able to take $5,000 "off" the price of something. That kind of profit margin is ridiculous.
Two, your car is not in the average. The year 2000 Grand Marquis for instance was a great car- for a couple years. After that, most of them suffered cracked intake manifolds, broken window motors, and a whole host of problems that shouldn't be experienced until a car is at least 10 years old. Similar problems run rampant through many cars from all of the companies. Chrysler's woes should be familiar to everyone. Just watch their ad campaigns from 10 years ago until now.
Ford was just doing plain bad. Luckily for them, their image wasn't drained like Chrysler's, so they could still salvage themselves. There for a while though, they were on the verge of sinking because of their bad quality, high prices, and terrible dealers. They had to sell some of their marques that were dragging them down, and now they're in a better place.
GM...jeeze, I don't know where to start. Far overpriced vehicles for one. Many people are familiar with their factory woes. Quality is ok, but just not great for the price. Their Cobalt starts out at $15,500. It's a nice car, but it's a throwaway, just like a Kia Rio. VW's Jetta is only $1,500 more, doesn't feel like a rolling tin can, and is better in every way.
The Big 3 can do it. I've seen some great products roll off their lines, so it's not a question of ability. It's just a question of will they restructure so that they're more competitive. They're at a great point right now, both from an economic standpoint and a PR standpoint, to come back and kick some ass. I guess we'll see if they do.
I think if they were going to do that, they would have done it back when it was their own money they were losing.Quote:
Originally Posted by Quick Orange
You would think the oil shortages of the '70s would have taught them about efficiency and QUALITY(above all) meant somehing to the consumer, but evidently the lords of planned obsolescense just didnt get it! Damn the quality! Full bells and whistles ahead!
You're ignoring the fact that people didn't stop buying American cars. People stopped buying anybody's cars.
That fact can be ignored since Toyota, Honda, Nissan, etc are not operating at billions of dollars of net loss per quarter.Quote:
Originally Posted by Quick
Regardless of consumers' buying habits, the big three are hardly able to stay afloat while foreign automakers are at worst still breaking even in the US market
right. whether a huge corporation or a lone individual... responsibility is the keyword. until people and companies are held accountable for their own stupidity, we won't see an end to all this.Quote:
Originally Posted by Quick
I'm ok (well, mostly) with giving the automakers a loan that must be repaid, although I question whether Chrysler does not have the capitalization given Cerberus' ownership of it. I am definitely against the 'Wall Street bailout'. Like many others, I live within my means. The suits on the Street should be faced with the same situation, not saved from the consequences of folly.
My ¢2 worth.
Wayne
I totally agree with you, but the banking situation is a complex one.Quote:
Originally Posted by bbqncigars
I believe the execs who were in charge should be criminally prosecuted and held personally liable.
But the banking system itself cannot be allowed to collapse. If it would, then we would probably dive into another great global depression. That would make the 700 B$ seem like a pittance.
The bailout as it is now does not come with enough conditions imo (we've had a bank bailout as well, though for 'only' a couple of B$) but anything is beter than a collapse of the banking system. That would pretty much destroy the modern economies for many years.
I saw this online today and thought I'd share:D