Open Thread (11/14/2008)

another thought - instead of the US buying GM, Ford and Chrysler, how about we just eliminate CAFE standards regulations?

people like Silverados, Escalades and F150's - they hate the Aveo and Festiva.  Let US companies make big stuff, and let Honda and Toyota make small stuff.  Consumers can still get what they want.  Converse doesn't make a pump and Nine West doesn't make a basketball shoe - what's the big deal?

people like Silverados, Escalades and F150's - they hate the Aveo and Festiva. 

And some people hate the Silverados, Escalades, and F150's - they love the Aveo and Festiva.  What's your point?

Let US companies make big stuff, and let Honda and Toyota make small stuff.  Consumers can still get what they want.  Converse doesn't make a pump and Nine West doesn't make a basketball shoe - what's the big deal?

No, consumers don't get what they want.  They get a bunch of the same home-grown crap that they don't want (as shown by the fact that GM is not making enough sales to bring in the bucks) but are subsidising with their bailout money.  I didn't say don't make big stuff, I said make more efficient stuff.  The Ford Escape Hybrid is a great example, same with the Mariner Hybrid.  The mileage isn't as great as my Prius, but it's a lot better than the three you mentioned, and shows a committment to giving the consumer what they want:  fuel efficiency and power.  Why are we not getting more of this innovation from our automakers?

I think it's a very sad day when we have Americans essentially saying "let's leave the innovation to the Japanese, we're cool with what we've got."  If we're investing $25 billion, I want a little more return on my dollar than more of the same stuff that people aren't buying..  These companies are hemorraging money and have been for years, yet they blame the unions and their demands as the reason instead of their own lack of following the free market they claim to love so much.  I can't support a business that villifies their workers as "greedy" for demanding fair compensation while at the same time they're paying the company executives multi-million dollar salaries to point the company ship straight at the iceberg.

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Anon, what would you know about logic and facts, would you like to try to apply some and respond to my comment maybe? - Run4cvrlib on 2008-10-16 @ 11:00pm

I think there are emission issues with diesels in America, but someone can correct me if not.

Arvid, my point is the US gov't is messing around with the auto industry with the CAFE standards, in the name of a "national energy policy", and it hasn't exactly helped out domestic producers.

The Big Three are not blameless.  But before we throw billions of dollars at protecting all these high-paid union jobs, why don't we at least let them do what they have done pretty well - make big, powerful vehicles.  The Japanese have led the charge on hybrids, but that isn't the only type of innovation possible in autos.

Detroit has pushed pickups because pickups are an absolute rip off for the consumer.  They cost more than most cars and they require not only less man hours to assemble, but also less materials overall.  Think about it.  Half of any truck is just a steel bed - nothing to it at all.

So Detroit has pushed F150s and the rest in order to maximize profits irresponsibly.  Everyone knows that trucks get piss poor gas mileage, but the US automakers haven't cared.  In fact, just the opposite - the average truck now has such excess horsepower and towing power that it is literally a joke.  The guy who used to live across the street from me had some $30,000 Dodge truck that was massive.  And he drove it to work every day and then back home.  Maybe he used it to pick up some drywall at Menards one weekend.  That was pretty much it.  Way more truck than anyone needs.

But more and more trucks, more and more Super Bowl commercials, more and more carbon emmissions.  Absolutely lunacy.

Well, now they're screwed while Toyota and the rest are nicely positioned to dominate the new mileage standards marketplace.

I continue to think that the first eight years of this century are going to be look upon as the "Era of American Stupidity" when the history books are written. 

they require not only less man hours to assemble, but also less materials overall.

I don't think so. Trucks weigh considerably more than cars, so there's no way you can say they use fewer materials overall. Further, there are far more structural configurations for pickups (engine, tranny, suspension, cab, bed, etc.) than for cars, requiring more setup time and retooling. Let's not forget that trucks aren't simply spot-welded unibody construction like cars, but body-on-frame with extensive welding.

gas was $4 per gallon.  Now it's $1.86.  Truck sales will rebound.  Auto sales have always been cyclical.

Will there be a Chevy around for people to buy - that is the question.

IP, it's Dem payback.  If the GOP is going to save the rich Wallstreet fatcats, then the Dems get to save their union buddies.

We saw last year that Americans are rational.  High mileage vehicles were purchased, people drove less, mass transit usage increased - all in a reaction to high gas prices.  Let's get rid of the "mileage standards marketplace".  That is all I'm saying.

gas was $4 per gallon.  Now it's $1.86.  Truck sales will rebound.  Auto sales have always been cyclical.

Do you really think gas is never going to get back up to the $4/gal range?  Moreover, is the American consumer really going to go along with your line of thinking?  I think many (but not all) of them will, because most people just simply do not think for the long-term.  That's why people buy these trucks they don't need because they're told a real man drives a Canyonero.

Who are you to say it is more than he needs?

I can say it's more than he needs, absoluetly, just as easily as you can (and have) dismissed social welfare programs as being more than we need.  If you're not in a line of business that requires the use of a truck, why buy one?  If you're not hauling things on a regular basis, why get a truck?

RSW, you are confusing "need" with "want".  If you're getting it because you prefer a truck, that's fine, but that's not a "need", that's a "want", and wants are 99.999% of the time much more than needs.    I don't "need" a Prius.  I could've gotten along just fine with a Camry or other similar car.  I wanted one for a variety of reasons, and I am paying for that premium through a higher monthly car payment and higher maintenance expenses.  At the same time, I'm also benefiting from using only 22 gal/month in gas and longer intervals between maintenance cycles.  That's a trade-off I'm willing to make, and will continue to make as my next car will be another hybrid.  I refuse to go back to being so dependent on fluctuating gas prices.

It's ok to want something, but realize that when you get more than you need in order to satisfy what you want, you're going to pay for the premium.  If you're in a position to do that and handle the long-term repercussions, more power to you.  But don't go buy a gas-guzzler truck/SUV because you wanted more than you needed, and then complain when gas prices go back through the roof, the vehicle depreciates in value significantly faster than expected, and it breaks because it was made for profit instead of efficiency.

I thought you Republicans were supposed to be all about people taking responsibility for their actions?

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Anon, what would you know about logic and facts, would you like to try to apply some and respond to my comment maybe? - Run4cvrlib on 2008-10-16 @ 11:00pm

Arvid, if you want to spend more on a Prius - fine - whether you "need" it or not.  But I got the impression that D. Boon didn't want to allow his neighbor to buy a truck - because he didn't "need" it.  I do think people should be responsible for their actions.  If they buy trucks that get 10 mpg, they know what they are getting.

I don't think we should be subsidizing gasoline, nor do I think it should be taxed for the sake of driving down demand.  (It should be taxed to pay for road maintenance, at the state level.)

TP, I think people are rational, and have short memories.  At current gas prices, and with $5000 rebates, those big trucks look really attractive. 

TP, I think people are rational, and have short memories. At current gas prices, and with $5000 rebates, those big trucks look really attractive.

Find me a definition of "rational" that involves impulse buying while ignoring long-term consequences.

I always wonder about the discussions we have on this blog. Like gee 46 million people don't have health Insurance, then I read that car companies shouldn't build large cars and trucks because they are not fuel efficient and pullout. Of course the next step is always when the market changes and gas prices go up and those big cars and truck sale drop and the car industry suffers because the cost of the insurance for the people that still have insurance and who are paying the taxes and for the non-payment of other people who can't afford insurance we say let those car companies go out of business so what if those people lose their insurance. I am not saying I have any real answers but the car industry can't make any money on the Prius or the small cars they make them on the big cars and trucks you want to keep the car industry and the benefits that go with them relieve CAFE.

I am not saying I have any real answers but the car industry can't make any money on the Prius or the small cars they make them on the big cars and trucks you want to keep the car industry and the benefits that go with them relieve CAFE.

Uhhhh, have you paid any attention to this industry?

Just a couple tidbits-

Whether somebody wants a truck or needs a truck should be of no concern to anyone other than the person who is buying the truck.  There are too many busybodies in this world (this house in Urbana shouldn't be torn down, the side of a brand new multi million dollar building going up downtown Champaign is ugly and cheap looking, how many carbon credits are you buying)  STFU already  Give it a rest please.  

The American auto makers are doing what they can in this economical climate to survive, just like me and you.  They have shuttered plants that make unpopular models, they have created cost consolidation by introducing platform sharing, and they have to some extent changed with the times (think Cadillac Escalade Hybrid and the new Chevy Malibu).  Letting them all fail would be a big mistake IMHO, too many lost jobs and benefits. 

the bailout alternative is bankruptcy, in which GM and Ford will get to "modify terms" with their debtors - including all those retired union workers getting benefits - and "modify terms" in their labor contracts with current employees.

Whether somebody wants a truck or needs a truck should be of no concern to anyone other than the person who is buying the truck.  There are too many busybodies in this world (this house in Urbana shouldn't be torn down, the side of a brand new multi million dollar building going up downtown Champaign is ugly and cheap looking, how many carbon credits are you buying)  STFU already.

That would be fine if we all lived on our own secluded islands, but we don't.  The actions of one, for good or bad, have impact on those around them, so they do have a right for concern about the decisions of those around them.

The American auto makers are doing what they can in this economical climate to survive, just like me and you.  They have shuttered plants that make unpopular models, they have created cost consolidation by introducing platform sharing, and they have to some extent changed with the times (think Cadillac Escalade Hybrid and the new Chevy Malibu).  Letting them all fail would be a big mistake IMHO, too many lost jobs and benefits.

They're coming back around to the concept of efficient vehicles only in the last couple of years, and they fought that tooth and nail the entire way, because while high-efficiency cars and trucks are great for the consumer and the country, they're not all that great for the Big Three's bottom line.  They can't make "as much" money off of them, so rather than be innovators, they buried their heads in the sand, pumped up the image that it's an American thing to have poorly efficient vehicles, and  took a backseat to the Japanese in advancing the auto industry.  Even when they started coming around to the idea of hybrids, they couldn't even design it themselves - Ford ended up entering into an agreement for the use of main component from the Hybrid Synergy Drive in their hybrids.

These companies have managed themselves into the ground and deserve to fail or be massively restructured if we're going to bail them out.  I don't like the idea of bailing them out, but if we are, then there are going to be some major changes to their practices and philosophy that need to happen to ensure we get the best return on our investment.

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Anon, what would you know about logic and facts, would you like to try to apply some and respond to my comment maybe? - Run4cvrlib on 2008-10-16 @ 11:00pm

They can't make "as much" money off of them, so rather than be innovators, they buried their heads in the sand, pumped up the image that it's an American thing to have poorly efficient vehicles, and took a backseat to the Japanese in advancing the auto industry.

I'd just like to clarify - they could make as much money with efficient cars, but they would have had to actually invest money into R&D, rather than rely entirely on century-old technology. Clearly they didn't want to do that until it was too late.

a salute to sheet metal workers everywhere?  :-)

fixed, sorry IP.  That is not a good way to have a rational discussion and I should have known better.

I see your point about rewarding failure and political pressure, so let's call it a loan.  This is a tough time for everyone not neccesarily because of the auto makers.  Their biggest mistake in my opinion is not what they produced and when, but the long term contracts that they signed with their workers.  These contracts provide for retirement health care and large hourly wages.  They contribute a good deal towards the big three's inability to rapidly change with the times.  The total employees for the three is over 787,000, granted that includes Mercedes also as they are part of Daimler Chrysler, but that does not include all the parts manufacturers or secondary vendors (think Flex n gate, Rantoul Products, and Eagle Wings).  The number could easily double when figured in.  How much would it cost to create new jobs, pay unemployment, or provide insurance for 1.5 million newly unemployed Americans with families and mortgages.  Think our economy is bad now?  You ain't seen bad yet. 

Arvid points out: "The whole "need"/"want" with trucks (and consumerism in general) is summed up nicely by a GMC commercial from about 6 years ago (I think), with the simple tagline: "It's not more than you need, it's just more than you're used to.""

Advertising has a HUGE deal to do with this, absolutely.  People want big cars because for the most part they've been told that the luxury thing, or particularly the manly thing, is to have a big truck, and you're only safe in a giant SUV.

Meanwhile, places abroad where the cars are smaller, they've LONG sold cars with the same marketing as computers and cellphones - the goal is super high tech, manuverable, streamlined design, and yes, small.  Inside should be roomy enough, but outside, you want to be able to slip into the smallest spaces and drive forever on little fuel.

I think the funniest car billboard I ever saw was for some Chevy truck or other, it had a manly man in western wear (boots, hat, plaid shirt with buttons) sitting down, legs splayed, and covering his crotch he was holding up a picture of the truck. The slogan on the whole thing? "Like a rock."  Took a while to stop laughing...

My 401k doesn't look very good right now, but I'd rather have it than a GM pension.

the tragedy of this whole deal is that companies can get away without fully funding pension obligations when they are earned.

The Champaign County Urban League apparently closed today after 20 years.

At least now Mr. Culver will not be giving them any more money from the Unit 4 coffers.

As far as I could tell from the article in today's paper, the investigations will continue.

I did not, though I saw a lot of people leaving it, wearing Chief stuff on Green St. (long after the game ended, and they were talking about the event some).

I think the Eisenhower appearance was the one time he went to the White House? I remember reading about it the Daily Illini (on microfilm at the library, I'm not that old!).  He used to do supermarket openings and the like too, though I guess those are not quite as impressive :)