Thu 20 Nov 2008
Can US Cars Compete?
Posted by Matt under Business , Cars , Government , Money , Products , TechnologyI found an interesting video on Yahoo that does a good job of summarizing the current state of the US auto industry. Like a lot of you I’ve been following GM pretty closely in the last few month and have seen a lot of positive and necessary change in their company and we’re beginning to see the turnaround in their product line that they’ve promised now for the last three years.
Still, in days like these, where the economic downturn has affected everyone throughout the automobile industry…as well as just about every other industry…it’s really tough to watch the company struggle. With the US car industry continuing to be one of the largest employers in the country and with so many pensions and retirement plans riding on their continued success, as well as the impact that a folding of the big three would have on consumers and supply chain companies in the industry, it’s a given that the car industry will and should receive some sort of aid, since most of the car makers current woes stem from a lack of proper credit due to bank freezes and the utter lack of consumer spending during a global financial crisis. And while I don’t as a rule recommend bailouts of any kind, I do see companies such as Ford and GM as being viable into the future.
As far as the taxpayer is concerned, if done correctly this aid could reap rewards, though as this financial crisis continues, small investors are looking more and more like victims, with nearly all aid solutions leading to significant losses by unsecured investors for short term investors, and possibly long term investors as well in a bankruptcy like solution. Hopefully in the next few months the government will be able to piece together some idea of what this might look like. As it sits, I’m just glad I’m a spectator and not Rick Wagoner.