Chrysler to stop all vehicle production Friday!

http://news.yahoo.com/s/nm/20081218/ts_nm/us_autos_7

http://money.cnn.com/2008/12/17/autos/chrysler_shutdown/index.htm?section=money_latest

I just refuse to believe that this is all due to quality.

I own a vehicle produced by all three car companies. I own a Ford, a
Chevy a Chrysler and a Pontiac. In that order. The Ford Chevy and
Chrysler were all bought new. No major troubles from any. The pontiac
is now 39 years old. It had 3 problems I've encountered in the 3
years I've owned it(it's all original) - bad coil, needed front
brakes, gas line loose at carburetor.

And what I hear for our stupid elected "leaders" is that it's all the
car companies fault. "Nobody" wants to buy these brands. Except that
the Senators asking Rick Wagoner, Bob Nardelli and Mullaly of Ford why
they have failed, all support fancy tax breaks for foreign car
companies within these United States. In other words, keeping Joe
Schmoe of Alabama employed at a foreign car company that gets millions
in tax breaks is more important than keeping Johnny Whatshisface
employed in Detroit where Michigan taxes the crap out of the old car
companies based on a taxation model circa WWII. And yet NONE of these
Senators seem to care about the survival of these United States. As a
nation. Where a Michigander and an Alabaman can stand together AS
AMERICANS.

So on Friday, vehicle manufacturing for Chrysler stops. Period. I do
pray and wish the best for those who are affected by the outage. And I
hope and pray even more that our entitled, fat, bloated
representatives who get re-elected time and time just the way the
communists voted in the same folk back to the Politburo start giving a
damn about the well being of the United States and act as leaders
rather than worrying about whether they'll lose a job like so many of
their constituents are losing.

It's a damn shame what's happening in the US. Manufacturing tanking,
401(s) a waste of time and money, Social Security unfunded. Perhaps
someday our fearless leaders will grow a pair and fight for what's
right. But I fear that's not going to happen. I think we're going the
way the Soviets went in 1991. Into the ash heap of history. I hope
not. But the light I think I see at the end of the tunnel I fear is a
train, and not the exit.

Jimmy

 

[big rant deleted]

I don't see what your all het up about.

Chrysler made too many cars. What do you want them to do?
Make more so that they have to sell them at below cost? Make
more so that they have to stack them up in the warehouse like
cordwood?

Sure it sucks for the workers to lose a month's pay and
unemployment won't make all of that up - but at least they
will have jobs to come back to a month from now.

It's not like everyone buying cars switched to buying from
Toyota. The import automakers are seeing the same drop
in sales that the domestic automakers are seeing.

Ted

 

Where do you get a problem about quality? Can't you read, I saw nothing
about quality.
I saw 30+% less sales, and trouble getting credit to buy a car.
If they can't sell all their production capability, they have to cut
back.

I have a problem with Chrysler's cars since 2004. They have nothing for
me, for a variety of functional and styling reasons.
Chrysler is now basically a truck company; I'm sure by Dailmer's design.

There are unemployment payments to enable workers to survive.

You need to read better and become more objective, those fat cat
politicians you hate think much better than you.

On the subject of bailing out the Big 3, I now feel it's a big mistake.
The Big 3 are stuck with UAW contracts they can't continue with.
They need a change in those contracts and the UAW is unwilling to
compromise, so unfortunately Chapter 11 bankruptcy is needed to
restructure the industry. If this restructuring doesn't happen, the Big
3 will struggle along from bail out to bail out.

You should stop driving this oldie 1969 Pontiac, it's polluting our air
badly.
Get it to scrap ASAP and you'll show you care for others.
You have enough cars without it.

 

That's correct. And it's not due to the demand for cars, it's due to
the credit markets drying up. No credit or small amount of savings,
nobody can buy cars at their current market prices. In a credit
starved market the cars are simply too expensive. Hence the drop in
sales. But at least the Japanese and Koreans have the common sense to
help their companies without question. We make our domestic
manufacturers do a dog and pony show and STILL tell them to go pound
sand. That ain't right.

Jimmy

 

It's true regarding the articles. But then you see some knucklehead
like THomas Friedman in the NY times going on how the domestic
manufacturers have not been building cars that people want. What's up
with him? I think he takes the subway too much and doesn't have a clue
what people buy outside of Manhattan.

Wow. It was just the opposite for me. Diffren't strokes....

30 states are in jeopardy of running out of unemployment funds within
a year. (Source NY Times - link below)

"Thirty states are at risk of having the funds that pay out
unemployment benefits become insolvent over the next few months,
according to the National Association of State Workforce Agencies.
Funds in two states, Indiana and Michigan, have already dried up, and
both states are borrowing from the federal government to make payments
to the unemployed."

http://www.nytimes.com/2008/12/15/us/15funds.html

Those fat cat politicians don't give a good God damn about anything
other than getting re-elected. They'd sell their family before
considering the good of the country. They are creeps. And it's both
parties. They don't think period. That's why they gave Treasurey
Secretary Paulson a $700,000,000,000.00 blank check. ANd Paulson has
the cojones to put a 35 year old "financial engineer" with the last
name of "Kashkari" (like Cash/Carry? Cash and Carry?). Is this a joke?
It writes like bad fiction except it's very real.

The pontiac runs fine, thanks. It'll stay right where it is.
Appreciate the advice, but how much wasted engergy would go into
melting her down? A lot more than I'll ever use keeping it running.
Isn't that what conservation is about? Of is it about feeling good?

 

Unemployment funds are running out in the majority of States. Have you
heard that? The country is broke and trying to save itself by running
the credit cards up even more.

They do think? Like they thought through giving Secretary Hank Paulson
a $700,000,000,00.00 blank check? That was supposed to "save" the
credit system.

 

It's Cerberus playing double-dare with Congress.

That said, Toyota shelved plans to complete its Mississippi Prius plant.

 

By the way the "laid off" union members will be getting 95% of their base
pay while the are off - don't think they are suffering too much.

Fred

 

Oh God!

Would you PLEASE quit perpetuating the MYTH that somehow
the amount of money that a person pays for an item is LESS if
they pay for it on credit than if they just pay cash?

The US consumer is waking up in 2008 and discovering the
REALITY that if you buy something on credit, that the INTEREST
that is paid tacks a LARGE AMOUNT OF ADDITIONAL COST
on to the price. So they are pulling back, paying down their credit
cards, and doing the old-fashioned method of buying things - which
is to save up the money FIRST and THEN spend it.

Why do you think that all of the investments are paying shit right
now?

Home costs are an exception to the rule because in prior years,
the appreciation of the home value outpaced the interest rate on the
mortgage - so even though you may have ended up paying, say,
a half-million dollars in interest for a $120K home at the end of
30 years - the home price had appreciated to that half-million
dollars. Thus, you didn't lose money - although you really didn't
make any money either.

How many new car sales every year do you think are vanity
purchases? I'd conservatively guess about half. The non-vanity
purchases are made up of 80% business purchases, and 20%
individual purchases I'd guess.

That leaves a LOT of slop that can be taken up in a tight market.

Now as for this nonsense that credit markets are drying up, that
is false. The ONLY credit markets that are drying up are
the "we'll finance anyone the law allows" sub-prime credit
markets, and unsecured credit. In short, they are no longer
letting people with inadequate income amounts, and a history
of defaults, get credit to buy a new car. Nor are they just giving out
$50,000 credit limits on unsecured personal lines of credit
anymore. And this is a bad thing? How, exactly?

For the people with bad credit or small amount of savings,
well guess what. There's TONS of used cars out there on
the market that are in GREAT shape. Go buy yourself a nice
big SUV that's a few years old, and you will get a fantastic
used vehicle for a song. Gas prices right now are in the
toilet, so no problem fueling it. And if gas prices rise again,
well then just use some restraint on driving and get out of
that goddam habit of just jumping in the car and driving to the
store every time you find you need a little thing.

Use a little logic for God's sake. There's only ONE REASON
that new car sales have fallen, and it has NOTHING to do with
the banks. It is simply because PEOPLE ARE DRIVING LESS.
There's plenty of government statistics to back this up. Every
year since 2005 the average number of miles driven by every
driver in the US has gone down. Fewer miles driven, well
cars don't wear out so fast. When cars take longer to wear out,
people don't buy vehicles to replace them.

But, FINE don't believe me. Go ahead with your fantasy that
somehow in a few years when India and China start selling the
sub-$5000 cars and the rest of the automakers drop their
prices to compete, that it will magically wake up car sales.

Ted

 

But that was false logic economy too (that the real estate industry
loves to perpetuate) because most families would still need a place to
live when they sold that house. The replacement house will also have
inflated a similar amount, and since an overwhelming amount of the money
they paid into the previous house went towards interest and not the
principle, they're going to have to finance the new (probably larger and
more inflation-adjusted expensive) house too - at the new inflated
(literally) price. If they're "moving up", then they really have gained
nothing financially speaking - they just perpetuated their indebtedness
that is proportional to the value of whatever home they bought at the
moment when they initiated the loan.

 

A newspaper report a few weeks ago quoted the example of a guy who had
just landed a new job after being unemployed for a while but couldn't
get financing for the *used* car he needed to get to the job.

Perce

 

It's not a myth. And now that the credit markets have tanked, the
result is self evident. People can't buy new cars, new car dealers
can't move inventory, car makers are making too much product. When
supply is up and demand is down, price falls. Macroeconomics 101.

That consumer exists in your head. Marketing folks work with the
finance people and the mantra is "buy buy buy - we finance anyone" -
stuff like that. No credit markets to lend, you can't move inventory.
Inventories have been built and maintained for decades with a credit
market supplementing purchases. Look at all the furniture companies
that went belly up.

They are paying shit because banks lent money to people who could
never really pay back the money. BUT the banks, in conjunction with
the rating agencies (Fitch, Moody's Standard & Poors) rated the
securitized junk that supposedly mitigated risk as AAA "Investment
Grade". In the real world, the loans were so risky they should have
been rated junk. When the 24 year old borrowing 2 million dollars cn't
sell his "Investements" or pay his mortgages the banks were left with
AAA rated pieces of paper. Hence the shit returns you reference. Add
in some leverage (10 dollars controlls 100 or more for example) and
the crash is exponential.

You lose. You don't rake up leaves in your investment, or fix a leaky
faucet, repair cracked concrete - there are huge minuses to owning a
home. They aren't investments. But if you can pay it off fast while
you're young, you can pocket more cash than renting. *IF* it's paid
off. cause you're still going to have maintenance and taxes. And now
that school taxes are getting less help from the states, guess where
public school funding will comre from? Higher property taxes on your
investment.


..

You are categorically wrong.

It's not. But it IS deflationary. And the economy WILL contract.

Plenty of Government statistics, eh? Like the economy was fine, credit
markets were fine, Greenspan patting himself on the back talking about
the resilliensy of the economy. SEC doing due dilligence. Yes, the
government statistics, much like the rating agencies are doing a bang
up job, Ted! It must be that people are driving less and not needing a
new car. Thanks for clearing that up!

Well, I see you clearly grasp the big picture! And here I was thinking
things were bad. Think I'll go whistle past the graveyard now!

Jimmy

 

The point is that somebody buying a USD 20K can't necessarily plunk that sum
down on the counter but can afford, say, USD 500 per month.

That is the point and it doesn't matter that the total sum paid is greater.
Same with home loans, of course.

In Britain all car loan adverts show the cash price and the total sum paid
if in instalments. It's obvious it's dearer to borrow (some interest-free
deals notwithstanding).

DAS

To send an e-mail directly replace "spam" with "schmetterling"
---

It's not a myth. And now that the credit markets have tanked, the
result is self evident. People can't buy new cars, new car dealers
can't move inventory, car makers are making too much product. When
supply is up and demand is down, price falls. Macroeconomics 101.

[...]

 

Toyota just opened a new plant in Ontario, the RAV4 is being built
there, one shift for now.

 

They won't lose a months pay. When Chrysler announced they were
stopping manufacturing a month early, there was some Chrysler auto
worker being interviewed on TV complaining about,
"How am I going to live on 80% of my regular wage"?
THAT'S EIGHTY PERCENT FOR SITTING AT HOME.
He went on to say how he has a family, bills, a mortgage and car
payments!
Responsible financial counselors have said for years, you should have
six months income in the bank to cover emergencies. Where is his
"rainy day fund"? Common sense should have told him to start saving
money months ago when the handwriting appeared on the walls.

BTW, there have been continuous Dodge Caravans in my garage since 1984
so I have no ill feelings towards the company. I truly hope they make
it out of this.