Posted by
Rich from NW Indiana on Wednesday, November 12, 2008 2:06:43 AM
Now that bailing out every large corporation in trouble is in vogue with those "running" the government. General Motors and the other two remaining American car makers are stepping in line.
The auto industry does has some major challenges. It is stuck with some bad labor contracts, many retirees, a lot of government regulations and a very bad current market. Some of it is self inflicted and plenty is the government fault.
Having the government involved so much in business just isn't good. It makes for the car companies to delay making the hard decisions that would save the companies. GM really needs to stop thinking it will swallow Chrysler, hopefully that deal will stay dead. It only makes things worse. But it something like that would never be considered without government interference.
Buick, Pontiac, GMAC and Saturn's days are numbered, their value isn't worth very much anymore. Chevy and Cadillac are the only two brands that have good sales anymore. Something has to happen with the labor costs, that can cannot continue to be kicked down the road. But if the government offers money, that problem will remain because it can be ignored again.
Would GM be better off without it high cost labor contracts and retirees, most of its underperforming brands and a lot of government regulations? Yes! Will it happen? Nope.
Government doesn't believe in the free enterprise system. Therefore it will not allow large company to evolve or go out of business. Instead of allowing the economy fix the auto industry on its own, it will only help it decline further. It will contiue to be the unwanted stepchild of the US economy that it has been for the last thirty years.
A smaller leaner GM would do well with Chevy and Cadillac, but we may end up with none of the GM brands. GM should be allowed to reorganize on its own.