Stalin
Well-Known Member
- Joined
- Apr 4, 2008
- Messages
- 1,808
Looks like the same sort of myopic stupidity that dominates the finance industry is in the car industry in lavish amounts
This should be re-run of Eastern Europe in 1989.
In its submission to Congress, General Motors said it needs $4 billion before the end of December and another $4 billion by the end January as part of an $18 billion loan. "Absent such assistance, the company will default in the near term," GM said, "very likely precipitating a total collapse of the domestic industry and its extensive supply chain, with a ripple effect that will have severe, long-term consequences to the US economy."
The company will eliminate up to 31,500 jobs, dropping its total number of hourly and salaried workers to as few as 65,000 by 2012. By contrast, at the time of the last major national strike against GM, in 1970, there were 350,000 union members at the company.
The number one US car maker will retain only four core brands—Chevrolet, Cadillac, Buick and GMC—and will sell, eliminate or consolidate its Saturn, Saab, Hummer and Pontiac brands. Its North American factories will be reduced from 47 to 36, and the number of dealers will be cut from 6,450 to 4,700, eliminating thousands of jobs in towns, small and large, across America.
Chrysler is asking for $7 billion and has indicated it will run out of money by the end of the year. The company, owned by private equity firm Cerberus, has already eliminated brands, disposed of a large number of industrial assets and slashed 32,000 jobs over the last two years, including 5,000 salaried workers who were forced out of their jobs the day before Thanksgiving. Chrysler, which has held merger talks with GM, Nissan and other companies, is widely expected to be absorbed by another auto maker, leading to thousands more layoffs.
Ford, which claims it has enough money to last through 2009, is requesting a $9 billion "standby loan." The company, which has closed 17 plants since 2003 and wiped out 45,000 hourly and 12,000 salaried jobs in North America over the last three years, promises to shrink its operations further, selling off divisions such as Volvo and pushing through other cost-cutting measures.
...
Those backing some form of bailout are insisting that it be contingent on the permanent shrinking of the industry and the destruction of the modest living standards for which generations of auto workers have fought. In a similar manner to the 1979-80 Chrysler bailout—but on a much larger scale—they are using the threat of mass unemployment to wrench concessions from auto workers and set a precedent for imposing the cost of the economic crisis on the backs of the entire working class.
The further gutting of wages and benefits and contraction of the industry, however, will do nothing to reverse the underlying crisis of American and world capitalism, which is at the heart of the collapse of the industry. It will only intensify the crisis as millions of working people are stripped of the means to purchase a car.
BusinessWeek magazine recently noted that the contracts signed by the UAW in 2007, which will cut new auto workers' wages in half—to $14 an hour—mean that "for the first time since World War I we will have people building automobiles in America who won't be able to afford the vehicles they build."
The immediate cause of the collapse of the US auto makers is the global financial crisis precipitated by the frenzied speculation and financial manipulation of Wall Street over a period of decades, which has been accompanied by the dismantling of large sections of American industry. This immense growth of economic parasitism is itself an expression of the historic decline and internal decay of American capitalism.
The resulting credit crunch has made it increasingly difficult for consumers to obtain auto loans and has more generally depressed consumer spending, leading to further declines in production and a worsening of the financial crisis.
This was underscored by this week's reports on US auto sales, which fell to their lowest level in 26 years in November, with Detroit manufacturers suffering a 40 percent decline and even top-selling Toyota suffering a drop of 33 percent. Analysts predict that total 2008 US sales will be less than 11 million, down from 16 million the year before and a peak of 17 million. European and Japanese carmakers are also cutting production to meet declining global demand.
http://www.wsws.org/articles/2008/dec2008/auto-d04.shtml
Comrade Stalin of Detroitus
This should be re-run of Eastern Europe in 1989.
In its submission to Congress, General Motors said it needs $4 billion before the end of December and another $4 billion by the end January as part of an $18 billion loan. "Absent such assistance, the company will default in the near term," GM said, "very likely precipitating a total collapse of the domestic industry and its extensive supply chain, with a ripple effect that will have severe, long-term consequences to the US economy."
The company will eliminate up to 31,500 jobs, dropping its total number of hourly and salaried workers to as few as 65,000 by 2012. By contrast, at the time of the last major national strike against GM, in 1970, there were 350,000 union members at the company.
The number one US car maker will retain only four core brands—Chevrolet, Cadillac, Buick and GMC—and will sell, eliminate or consolidate its Saturn, Saab, Hummer and Pontiac brands. Its North American factories will be reduced from 47 to 36, and the number of dealers will be cut from 6,450 to 4,700, eliminating thousands of jobs in towns, small and large, across America.
Chrysler is asking for $7 billion and has indicated it will run out of money by the end of the year. The company, owned by private equity firm Cerberus, has already eliminated brands, disposed of a large number of industrial assets and slashed 32,000 jobs over the last two years, including 5,000 salaried workers who were forced out of their jobs the day before Thanksgiving. Chrysler, which has held merger talks with GM, Nissan and other companies, is widely expected to be absorbed by another auto maker, leading to thousands more layoffs.
Ford, which claims it has enough money to last through 2009, is requesting a $9 billion "standby loan." The company, which has closed 17 plants since 2003 and wiped out 45,000 hourly and 12,000 salaried jobs in North America over the last three years, promises to shrink its operations further, selling off divisions such as Volvo and pushing through other cost-cutting measures.
...
Those backing some form of bailout are insisting that it be contingent on the permanent shrinking of the industry and the destruction of the modest living standards for which generations of auto workers have fought. In a similar manner to the 1979-80 Chrysler bailout—but on a much larger scale—they are using the threat of mass unemployment to wrench concessions from auto workers and set a precedent for imposing the cost of the economic crisis on the backs of the entire working class.
The further gutting of wages and benefits and contraction of the industry, however, will do nothing to reverse the underlying crisis of American and world capitalism, which is at the heart of the collapse of the industry. It will only intensify the crisis as millions of working people are stripped of the means to purchase a car.
BusinessWeek magazine recently noted that the contracts signed by the UAW in 2007, which will cut new auto workers' wages in half—to $14 an hour—mean that "for the first time since World War I we will have people building automobiles in America who won't be able to afford the vehicles they build."
The immediate cause of the collapse of the US auto makers is the global financial crisis precipitated by the frenzied speculation and financial manipulation of Wall Street over a period of decades, which has been accompanied by the dismantling of large sections of American industry. This immense growth of economic parasitism is itself an expression of the historic decline and internal decay of American capitalism.
The resulting credit crunch has made it increasingly difficult for consumers to obtain auto loans and has more generally depressed consumer spending, leading to further declines in production and a worsening of the financial crisis.
This was underscored by this week's reports on US auto sales, which fell to their lowest level in 26 years in November, with Detroit manufacturers suffering a 40 percent decline and even top-selling Toyota suffering a drop of 33 percent. Analysts predict that total 2008 US sales will be less than 11 million, down from 16 million the year before and a peak of 17 million. European and Japanese carmakers are also cutting production to meet declining global demand.
http://www.wsws.org/articles/2008/dec2008/auto-d04.shtml
Comrade Stalin of Detroitus
