GM Bailout, What's everyone's take? Options

[blu94gt]

So what does everyone here think of the US government bailing out GM with X billion dollars?

I think it's just plain silly. I do agree that if GM were to go under that roughly 3 million jobs could be lost, and would be a huge hurt to our economy. Realistically though, if they go under then Chrysler and/or Ford or someone else will just absorb them and take control. It's called FREE MARKET, if your business can't make it then you close your doors, the government shouldn't be involved at all. GM obviously can't make a quality car that people want to buy, can't figure out how to not get screwed by the labor unions, and drop all their money into silly projects like the Volt. Plus they waste all kinds of money selling the same exact cars under 4 different brands. Buick Rainer, Chevy Trailblazer, GMC Envoy, Saab 9-7x are all EXACTLY the same with different grilles and lights. What purpose does this serve other than wasting a whole bunch of money in having several different toolsets and suppliers? (all American companies do this, I've never been able to figure it out). Not to mention separate markets around the world.

So say the government bails out GM. They need to then supervise every financial move GM makes down to where they have a lunch meeting, require them to make eco-friendly cars or something like that, loosen the grip of the union, etc. Also to re-brand everything: Cadillac for luxury, Chevy for cars, GMC for trucks. Completely get rid of Pontiac and Saturn. After a few years of this setup, unify the US market lineup with the world market lineup of vehicles. Hopefully Ford and Chrysler would follow suit, I think they would all benefit.

In the end, I hope they don't get bailed out and are allowed to fail.

[saleeka]

I feel split on this situation. On one hand, the consequences of the failure of GM will obviously have a very negative effect on our economy. On the other hand, I hate the idea of wasting taxpayer (my) dollars on a company that doesn’t make a product I would be willing to purchase.

GM, along with Ford and Chrysler, have made uncompetitive, underachieving vehicles for so long that I can't see them all of a sudden having the American public being fooled into buying their products in the amount they need to survive. I bought a brand new Ford Focus in 2001 on the basis that it was widely considered to be one of the most desirable small cars on sale at that time. Big mistake… The turn signal stalk would break. Sunroof trim refused to stay in place. The “Ford Oxygen Sensor” ECU would fail, resulting in fuel cut off… All were reoccurring problems! I sold that car as fast as I could after the warranty expired. Because of my experience with that car, along with the fact that I’ve now had 5 years and 89,000 miles of 100% trouble free motoring in my 13 year old Toyota leads me to believe I’d be a fool to throw more good money after bad on another domestic car again.

I think it is fair to say that currently some GM products truly are desirable vehicles, such as the Malibu and CTS, but even the cheapest Malibu is still a $22,000 vehicle. There are many equally appealing alternatives when you start spending that kind of money. Most first time new car buyers are still going to be driving cars like the Aveo and Cobalt (no thanks!) if they choose GM…

Even if we do save GM from itself, when will Ford and Chrysler start asking for the same financial aid? Does saving one mean saving all? GM is publicly saying that if they fail, Ford and Chrysler will inevitably fall in their wake because of how interconnected Detroit’s auto industry is. Does this then mean GM will also inevitably fall if Ford or Chrysler fail first?

It seems some economic experts point to bankruptcy as the logical first step, and then come in and offer financial aid if that doesn’t succeed. I’d have to agree. At least with bankruptcy, GM would be forced to change, as opposed to risking who knows how many billions of our tax dollars by handing it over to current GM leadership. GM could very well make the same mistakes over again if serious change isn’t considered, and I don’t have faith that GM will survive if serious change doesn’t occur…

This post has been edited by saleeka: Nov 17, 2008 - 11:31 AM