Auto Bailout Not Ready, President Bush Says
December 15, 2008
President George W. Bush said Monday an announcement on an auto industry rescue was not imminent, leaving the Detroit Three's fate clouded in uncertainty for a little longer, Reuters news service reports.
"We're not quite ready to announce that yet," Bush told reporters on Air Force One during a flight from Baghdad on an unannounced visit to Afghanistan.
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GM Makes Major Slash in 1Q Production
December 12, 2008
By Bill Visnic
How bad is it? General Motors Corp., currently hoping for "bridge" funding extended by the Bush administration to keep the company from imminent bankruptcy, isn't buying into any optimism about the potential for an economic turnaround -- the company announced today it is slashing a quarter-million units from its first-quarter 2009 production schedules.
It's an outsized reaction that projects a downbeat outlook for the U.S. auto market's prospects in early 2009.
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White House May Come to Automakers' Rescue
December 12, 2008
By Michelle Krebs
The U.S. Treasury said it is willing to provide financing to Detroit automakers after the Senate Thursday night failed to approve $14 billion in loans to General Motors and Chrysler.
"Because Congress failed to act, we will stand ready to prevent an imminent failure until Congress reconvenes and acts to address the long-term viability of the industry," Treasury spokeswoman Brookly McLaughlin said in an e-mailed statement.
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Posted by Michelle Krebs at 6:36 AM under Analysis , Chrysler , Featured , Ford , GM | Comments (0) | digg this | Seed Newsvine
Remember Katrina, Senators
December 11, 2008
Detroit Free Press columnist Tom Walsh reminds senators from the Gulf States, many of 
whom oppose the loans to Detroit automakers, to recall Hurricane Katrina as they cast their votes on the bailout bill tonight.
"When Hurricane Katrina slammed into Louisiana and Alabama on Aug. 29, 2005, the automobile companies of Detroit did not harrumph that the Gulf Coast should have been better prepared. They didn't sit back and wait for New Orleans to submit a detailed plan for future repair of the ruptured levees," Walsh wrote in Thursday's edition.
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Posted by Michelle Krebs at 4:51 PM under Chrysler , Commentary , Ford , GM , In the Media | Comments (5) | digg this | Seed Newsvine
Big Three Bailout Rejected; GM Hires Bankruptcy Advisers, Report Says
December 11, 2008
By Michelle Krebs
The U.S. Senate rejected legislation that would have provided $14 billion in federal loans to keep afloat General Motors and Chrysler, which say they will be out of money by the end of the year.
At the same time, GM reportedly has hired lawyers and bankers to consider whether to file for Chapter 11 bankruptcy. Those advisers are among the best known in the bankruptcy and restructuring business who would handle what would be one of the largest bankruptcy filings in U.S. history.
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Posted by Michelle Krebs at 4:34 PM under Chrysler , Companies , Featured , Ford , GM | Comments (0) | digg this | Seed Newsvine
Former Fed Chairman Volcker Favored as Car Czar
December 11, 2008
Former Federal Reserve Chairman Paul Volcker looks to have the inside track for the newly 
created post of car czar, if the federal loans for Detroit automakers is approved by the Senate today -- an approval that is in doubt.
Nevertheless, the Bush White House reportedly is coordinating with the incoming Obama administration in choosing a new "car czar" to oversee the auto company restructurings required under the loan legislation passed by the House Wednesday night. Volcker appears to be acceptable to both sides.
The 81-year-old Volcker has been an important economic adviser to President-elect Obama and on November 26 was named head of Obama's Economic Recovery Advisory Board. Volcker has the added benefit of automotive bailout experience -- he was Federal Reserve Board chairman and a principal government participant in the Chrysler bailout. He and the oversight board played a key role in winning concessions from the United Auto Workers union and from Chrysler's banks..
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Posted by Michelle Krebs at 7:47 AM under Chrysler , Companies , GM , Personalities | Comments (0) | digg this | Seed Newsvine
House Approves Auto Loans; Now Onto More Challenging Senate Vote
December 11, 2008
The U.S. House of Representatives approved emergency loans to General Motors and Chrysler Wednesday night. Now the focus shifts to the Senate where Republican opposition threatens to stall or kill the bill altogether.
Senate Republicans, who will vote on the bill together, say it doesn't have the votes to pass.
The House approved the $14 billion in loans in a vote of 237-170. The loans would go to General Motors and Chrysler to stay afloat through March; Ford has said it doesn't need the funds immediately but would like access to a line of credit in case the economy worsens beyond its projections.
Posted by Michelle Krebs at 4:28 AM under GM , News | Comments (0) | digg this | Seed Newsvine
Withering Economy Already Endangers Bailout-Plan Assumptions, Expectations
December 11, 2008
By Bill Visnic
In their bailout blueprints presented to Congress last week, automakers presented forward-revenue assumptions based on forecasts for 2009 auto sales. In General Motors Corp.'s case, for example, it projected "downside," "baseline" and "upside" sales forecasts for the U.S. market, correlating how much funding the company believes it will need based on each sales scenario.
If a new survey of the nation's economists has any relevance, the beleaguered automakers had better strap in for a bumpy ride that may make a reality of those "downside" assumptions.
Bloomberg News' December survey of economists released this week paints a bleak outlook for 2009. The prominent economists comprising the survey sample predict consumer spending will plunge by a rate not seen since the 1940s, with household spending retreating by 1 percent, which also hasn't happened since World War II.
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Posted by Michelle Krebs at 4:13 AM under Analysis , Chrysler , Featured , Ford , GM | Comments (1) | digg this | Seed Newsvine
GM, Credit Unions Already Planning To Expand Partnership
December 10, 2008
By Dale Buss
Both General Motors and the Credit Union National Association would like to expand a just-announced pilot partnership that provides a 4 to 5 percent purchase-price discount to members of nearly 1,300 credit unions who buy GM vehicles in four Midwestern states.
After the June 30 wrap-up of the program launch, GM would like to roll it out to other regions or nationwide, Mark LaNeve, the company's North American vice president of sales, said today. And a credit-union executive invited Ford and Chrysler to consider their own versions of a test program that aims to bring some of America's most creditworthy middle-income consumers into GM dealer showrooms.
With the deal that began this week, GM is seeking broader access for its customers to one of the few reliable pools of auto-financing funds, especially because the company's finance arm, GMAC, is making practically no new loans these days.
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Posted by Michelle Krebs at 11:03 AM under Business , Chrysler , Companies , Ford , GM | Comments (0) | digg this | Seed Newsvine
GMAC's Survival in Question
December 10, 2008
GMAC, the auto loan and mortgage lender owned by General Motors and Cerberus Capital Management, said Wednesday too few of its bondholders have agreed to swap their debt, raising doubts that it can become a bank holding company and putting its very survival in question.
It also exacerbates GM's precarious situation as GM relies in large part on GMAC to finance its dealers and its car buyers. Already, GMAC has substantially tightened credit standards making it extremely difficult for dealers and their customers to receive loans.
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Posted by Michelle Krebs at 11:01 AM under Business , Companies , GM | Comments (0) | digg this | Seed Newsvine
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