Chrysler negotiations with creditors collapse – Car maker to file for bankrupcy
Per CNN
I guess this is not so breaking news. It looks like the filing is part of the Fiat takeover deal.
Question: How did US executives get so fucking bad?
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It was not so long ago that they were gleefully distributing their SUV profits to shareholders with no thought to tomorrow.
If we had this suck ass executive corps in the 40’s Japan and Germany would have rolled over us without breaking a sweat.
Worst selling vehicle EVER:
2005 Hummer H1 SUV. 374 units sold.
How did US executives get so fucking bad?
The capital gains and dividend taxes are too low… they are now below some tipping point where executives no longer care about the long-term business and only want to pump and dump the stocks.
The low taxes on equities create a ramped-up compounding effect on the wealth they generate, so that even short term gains can produce extravagant personal wealth, at the cost of the business.
Wrong as usual. Chrysler executives are heroes. They just bought the company a couple of years ago.
Daimler couldn’t deal with the UAW and dumped the automaker. Instead of seeing it fail, these guys raised the money to buy it. They were going to turn it around. Unfortunately, they ran right into the worse timing of the last 30 years. The credit crunch cut auto sales industry wide by 40% (not their fault), the new energy bill forced new MPG standards which cost the industry 100B (not their fault), and the unions wouldn’t deal with them until the company was almost gone last week (not their fault). The fact that these guys may yet save this company and its jobs says that they have the best intentions and iron wills. These guys are amazing, but their task is next to impossible in the current environment.
A simple answer to a simple question. Thank you.
Thanks Republicans & Tom Carper !
anon 4, I think you hit it. All of these guys are members of the “I’ll Be Gone By Then” club. And they will be gone with our money, which they can pump into Republican special interest causes so they can come back and screw us again.
With Chrysler, I’m siding with David. They bought a company that is in the midst of its second transition in a decade, I believe. it is hard to have that large of a company go through that many changes so fast. Employee moral must be through the floor.
Bankruptcy may force the UAW to the negotiating table to give the company a better shake at rediscovering it’s brand. Dodge trucks are strong, but otherwise it’s car brands are dismal. One has a Hemi gimmick muscle car, you have a Neon which is getting killed by the competition, and I’m willing to bet that you’d have to think hard to remember the name of their midsize family sedan or luxury brands. I can’t for the life of me remember them. They don’t even have a hybrid brand.
BS…..”Dodge trucks are strong, but otherwise its car brands are dismal. One has a Hemi gimmick muscle car, you have a Neon which is getting killed by the competition, and I’m willing to bet that you’d have to think hard to remembert the name of their midsize family sedan or luxury brands. I can’t for the life of me remember them. They don’t even have a hybrid brand.”
NOT UAW’s Fault!!!!!
“Question: How did US executives get so fucking bad?”
I know, paying 72 dollars an hour for unskilled labor. What the fuck?
The UAW was giving away the farm already. The UAW didn’t force Chrysler to lobby against raising fleet fuel economy to 24 mpg.
Did the UAW force Chrysler to put promote Hemi engines and build Dodge Challengers that get inder 20 mpg while Honda is building cars that get over 40?
The challenger is a car aimed at the 14 year old boy market.
I know, paying 72 dollars an hour for unskilled labor.
This number was debunked long ago…
I think paying $25M/year for incompetent executives is a lot of business’s problems.
Chrysler has been on life support for a while, so this isn’t a big surprise. It’s going to take a while to revive Chrysler because changing your brands and retooling your plants takes time.
One number to watch $2.25B. That is the offer that was given to Chrysler’s debtholders, which they turned down. Will they be able to get more than this in a Chrysler bankruptcy?
“Thanks Republicans & Tom Carper !”
“The UAW was giving away the farm already.”
Your ignorance is dumbfounding!
Your comment is lacking in substantiation.
Tom S wrote I know, paying 72 dollars an hour for unskilled labor. What the fuck?
Forgetting about the $72 bit for a moment, I think Tom S.’s remark calling autoworkers “unskilled” is quite enlightening on the mind of a Republican. I’m not sure that “unskilled” would be the first word that comes to my mind regarding autoworkers.
Reason #1 why the Chrysler deal fell apart was due to the hedge fund managers refusing to restructure. They demanded that the Fed dump more money into it, so they could reap their reward…
Well the Admin told them to shove it, and will force restructuring through chapter 11.
Everyone was willing to play ball – Fiat, the Fed, Chrysler, UAW…but not Wall Street.
But keep on blaming unions and the common man, if it helps you prop-up your ever-shrinking world view…
I’m sure that part of the reason it fell apart is because the creditors wanted the pension dumped too. SOP when they come in to take over a BK
Serious question here — If the union becomes the majority owner (or even a large minority owner) of Chrysler, how can it represent the employees as a bargaining agent? After all, there would be an obvious conflict of interest at work.
Fiat? They are also rumored to be interested in buying Saturn from GM.
I was in no way saying it was UAW’s fault, but bankruptcy allows a company to renegotiate or terminate existing contracts, and the UAW is not in a good position in a “new deal or we fold” scenario in today’s market.
The execs will use that leverage to squeeze more cashflow out of the contracts, making it more suitable for investment, numbers-wise.
Because it isn’t the union that is the owner, it is the UAW’s VEBA that put up the money. The VEBA is an independent trust and not a part of the daily operations. It is a very separate board that is not majority UAW members.
And the UAW made their give back deal with Chrysler some weeks back. The only people hanging out for more money are the hedge funds who own some of the debt.