NAM’s Engler Comments on Automaker Loans, Stimulus

By November 6, 2008Economy

In the flood of post-elections coverage, the National Association of Manufacturers and our president and CEO John Engler were asked to comment on a variety of issues, and high on the list were the economic stimulus legislation and the troubles of the auto industry. A sample…

Detroit News, “Automakers optimistic help may be on the way“:

The dire situation facing the automakers will become even clearer on Friday, when GM and Ford Motor Co. are expected to report substantial third-quarter losses and announce new cuts to curtail losses. The companies collectively lost $24 billion in the second quarter.

“At this point they are looking forward to a future that’s a pretty grim one,” said John Engler, president of the National Association of Manufacturers, adding that policymakers have to act fast. “Nature is going to take its course before (Obama) even takes office in January.”

Reuters, “US approves loan rules, auto execs lobby for more“:

President-elect Barack Obama courted U.S. automakers and pledged help, but the industry’s health is deteriorating so rapidly it may not be able to wait for him to take office.

‘He’s not here until January (20th) and that’s a long time in the life of these companies at the moment,’ John Engler, a former Michigan governor and president and chief executive of the National Association of Manufacturers, said., a Toronto news site, “Auto Makers Want $25 Billion No-Strings Attached Loans To Avoid Up To A Million Layoffs

GM and Chrysler are both talking merger. And talk about Hobson’s choice. It’s estimated a joining between the two could cost 24,000-35,000 jobs, close half of the latter company’s 14 manufacturing plants and shed another 50,000 jobs amongst suppliers. 

And that’s the best case scenario, because if Chrysler goes out of business, up to a million positions could disappear.

“It’s not just the three auto companies, it’s suppliers, all the way down the chain,” worries John Engler of the National Association of Manufacturers.

Join the discussion 2 Comments

  • GJ says:

    Remember this day. December 12, 2008 a referendum on behalf of the American taxpayer to hold GM, Chrysler and Ford management accountable for their own transgressions. Auto Workers unite and hold these managers accountable. Don’t lose site of the miserable management that got your companies where they are today. It’s a big mess that will hurt the line worker, so let’s press the managers to take their hits too. Don’t forget that mismanagement got you into this mess.
    It’s not the line worker who for many years ignored consumers. It’s not the line worker that approved inferior designs and resisted conventional wisdom to produce more fuel efficient vehicles.

    Unfortunately, the auto industry, as with airlines, is an industry Americans can love to hate. Polling Americans would likely reveal a large percentage of disgruntled consumers of these industries. It’s the arrogance we hate. Both industries continue to treat their customers as problems rather than the life blood of their existences. In the short haul this arrogance is stupid, but in the long run it’s deadly.

    It’s done. The leaders of GM, Chrysler and Ford should be held accountable now. It’s on them to make this better from here on. It’s a tough thing to say, but they’ll need to make the market forces work for them or they’ll simply fold. It’s not unfair as some might have you believe, it’s market forces bearing down on these poorly managed companies. What is sad is as always, it is unfair to the line worker, but had the taxpayer simply paid good money into these failing businesses the management would never have been called upon to own up and there’s little evidence that any of these managers would have used the monies to make meaningful changes.

    So don’t anyone lose sight that these managers are the guys who came before Congress ill-prepared. They came ill-prepared for the most important interviews of their lives. They knew that the results of these interviews would impact a great number of innocent people and they ignored that fact by showing up unprepared, without restructuring plans. They had apparently given little thought about how they got into the mess or about admission that their history stinks or about the ways in which their foreign competitors have been doing it better or about smarter hedges against rising costs or about fuel efficiencies or about customer service, and on and on. Isn’t that enough to show incompetence in their leadership?

  • Ken says:

    If General Motors goes under, not only will 3 million direct and indirect jobs be lost ballooning the unemployment rate to 10%, the suppliers will cease to provide critical parts to all automakers operating factories in the United States, including Toyota and Honda.

    Why should American auto companies be “blamed” for legacy costs associated with taking care of American families with retiree health care and pension? True, American auto companies built a lot of SUVs and trucks in the 90s, but what kind of American Dream blames a company for going after profit? The spike in oil prices earlier this year, and the credit crisis of the present are out of the control of the automakers.

    In addition, General Motors has redeemed its mistake for not producing a vehicle similar to the Prius in the 90’s by promising to introduce a revolutionary electric vehicle in November 2010, which will not only be game-changer for the industry, but will alleviate America’s dependence on foreign oil, which inevitably funds terrorism. Regular, transparent updates from the company makes us very confident that this electric vehicle will become a reality by that time. Let’s support America.

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