Saving Detroit?

Time Magazine, June 8, 2009

"In other words, for all the number-crunching and all the brute financial haircuts involved in these bankruptcies (at GM and Chrysler), at the heart they are animated by the audacity of hope. . . . And these hopes float on the audacity of deficit spending. . .the public price tag will
exceed $100 billion.

"When Obama drafted Rattner and another financier, Ron Bloom, to lead his auto task force, he instructed them to 'treat these transactions in a commercial manner.' That is to say, restructure the companies in a way that makes good commercial sense. The "commercial" mantra proved fleeting. The first imperative of commerce--to add value and thus earn profits--is too narrow to host all the civic expectations attached to the auto industry. If GM's only task were to make money, the company would shutter its car factories (or move them to low-cost countries) and churn out light trucks.

"But, that's not possible at a time when Obama and congressional leaders are requiring Detroit to do more to advance conservation and alternative energy and create 5 million new jobs."

GM Facts:

US Market Share: 1962--51%; 2009--23%

US Employees: 1962-- 464,000 ; 2009-- 92,000

US Vehicle Sales : 1962-- 4.2 million; 2009-- 2.98 million

Revenues (2009 d0llars) : 1962--$105 billion; 2009-- $149 billion

Profits: 1962-- $1.46 billion

Losses: 2009-- $30.9 billion


The numbers say it all!!