Reply to "The Bailout..."

Well, ... I will way into this ... (my chance to parody Rick Mercer) ...

First, let me say that my father, (God rest his sole) worked most of his life at the Ford assembly plant in Oakville. The first new car he owned was a Pontiac. After that, he only bought Fords.

Yesterday, there aired (on CBC radio) a discussion of automobile manufacturing costs. The Total labour cost portion of the manufacturing cost for a typical NA vehicle was said to be around 5%. The UAW has made repeated responsible consessions to help out the Big 3. I was surprised to learn that in the U.S., the UAW has taken over the running of their members Health Insurance program - It is no longer a GM corporate liability. Also, I learned that there is a two teir wage system that reflects a salary "give back". I wonder what the big executives' "give back" is of their multi-million dollar salaries? As a reference point: Just after the US government gave Billions of TAX dollars to save FanieMAY and FredyMAC, the CEOs made sure they got to walk away with 30 Billion in salaries and bonuses.

Which leads me to the topic of products for the marketplace ...

The first new car I owned (at 18) was a '74 Ford Capri Mk 1 built in Cologne Germany (In '74, it sat in the dealer showroom right beside a beautiful yellow '74 DeTomaso). I owned and drove it for 17 years with no major problems (just could not get parts for it easily anymore). I have owned many other cars since. Currently my wife's car is a Ford Focus Kombi (Stationwagon). I have NEVER had any problems with the Ford cars I have purchased. They have been, and are, reliable with quality that I have been pleased with. Of the Big NA 3, Ford, not surprisingly in my opinion, currently is in the strongest position.

When teatering on bankcrupsy in the 80's, Chrysler re-invented itself with Government help and Lee Iacocca's leadership. I have every confidence they will again. (Yes, I drive a Jeep Cherokee) Then, Governments made stock option loans and, in the end, it was a good investment.

We then are left with General Motors. The largest of the Big 3 and second now to Toyota in the world. Under Smith's leadership, GM appeared to be getting out of the automobile business. I haven't seen anything substantive to make me think that culture has changed. Sure there were, and are, examples of products that tended to break the trend. But, the culture did not seem to change. Rather that re-invest in forward thinking for their automotive sector ("Who killed the electric car?"), they increased truck and van production beause that was a sector the Asians and Europeans did not compete in. Well the chickens have finally come home.

When Harley-Davidson was on the brink of going under, Ronald Regan stepped in and saved it. It has done well since.

I feel the North American economy depends on helping the Big Three. Our Governments should step in and provide the help they need. I just hope that people in positions of authority, as in the case of Chrysler in the 80's, tie the help to require a corporate business model that will make them produce forward thinking, quality, technologically innovative, reliable vehicles that the market needs. Otherwise, as in the case of Smith's GM - we are delaying the inevitable.

B.G.

P.S. I feel better now !!