GM, Chrysler request $10 billion in aid: sources

[Snazzy]

Source: Reuters

GM, Chrysler request $10 billion in aid: sources
Mon Oct 27, 2008 10:56pm EDT
By Jui Chakravorty Das and Kevin Krolicki

NEW YORK/DETROIT (Reuters) - General Motors Corp and Cerberus Capital Management have asked the U.S. government for roughly $10 billion in an unprecedented rescue package to support a merger between GM and Chrysler LLC, two sources with direct knowledge of the talks said on Monday.

The government funding would include roughly $3 billion in exchange for preferred stock in the merged automaker, according to one of the sources, who was not authorized to discuss the matter publicly.

The U.S. Treasury Department is considering a request for direct aid to facilitate the merger and a decision could come this week, sources familiar with the still-developing government response said earlier on Monday.

An injection of $3 billion in equity to support a GM acquisition of Chrysler would be roughly equivalent to the current, depressed value of the top U.S. automaker.

It would also give U.S. taxpayers a large stake in the turnaround of a struggling auto industry that employs over 350,000 American workers and is credited with supporting employment for another 4.5 million in related fields.

....



Read more: http://www.reuters.com/article/newsOne/idUSN2735477920081028

---

Who's talking about socialism???

[kirby]

1. I dont want a 'stake' in those turds...

They are dinosaurs that refused to adapt.

[Captain Hilts]

2. They are dinosauers now paying the price for the healthcare of their current and former employees.

GM, because of its retirees and the rising cost of healthcare, is a big HMO now.

[kirby]

13. True--If they had supported a Single Payer Healthcare...

They could have focused more resources on their core business.

But they also hitched their wagon to SUV's and are paying for that now.

The problem is that the Pension Benefit Guaranty Corp (and ultimately taxpayer money) will be funding the pensions promises for auto workers.

[Psephos]

3. Sounds like a government jobs program to me...that's how it should be discussed

If they need this cash to survive, the US industry is de facto not competitive on the basis of cost of production, product offerings, and intangibles such as image and chic-ness.

This should be an economic decision. Will the taxpayer receive future benefits in excess of the investment? If yes, mail the check. If no, pull the plug.

The problem is, to whom do we turn to assess the likely return on investment? When the cash is large, the decision is political, not economic.

[nolabels]

4. Everybody that is struggling should put in for some extra bucks!

Though i could easily get along without it, i am still going send my request in for extra hundred gee's tonight :woohoo:

[Purveyor]

5. No, no, no... All federal bailout money needs to go to the Wall Street bloodsuckers and their

minions as it is 'they' that produce real wealth and jobs.

:sarcasm:

[robinlynne]

6. fuck them. Dig up the thousands of electric cars they buried in the desert

that people wanted to buy and they wouldn't sell....

[Neshanic]

7. Screw them. Here's a little interesting tidbit...

"BEIJING, Oct. 27 -- Chrysler LLC owner Cerberus Capital Management LP isn't seeking to remove General Motors Corp leaders including Chief Executive Officer Rick Wagoner in a merger of the car makers, a person familiar with the talks said Sunday.

Cerberus also wants a "meaningful" stake, not a majority, in a combined company, said the person, who asked not to be identified because the negotiations are private. It's too early to say whether the New York-based buyout firm would have board representation, the person told Bloomberg News.

Wagoner, 55, is the longest-serving CEO at a United States auto maker, after taking the top spot at Detroit-based GM in 2000. Alan Mulally joined Ford Motor Co in 2006, and Robert Nardelli was hired at Chrysler last year. The person declined to comment on Nardelli's role, if any, in a GM-Chrysler merger."

So the idea is to keep the same assholes, just ask for the cash.

Oh, and like the 700 big bailout this has to be done NOW! Tomorrow at the latest!

[bluestateguy]

8. Welfare abusers

nt

[schrodinger_I]

9. Screw 'em!

Poor quality and bad management. The senior people at GM should really go
read some of Deming's books. That would explain why the Japanese auto makers are beating
the American automakers in terms of quality.

[Warren Stupidity]

10. So will the media ask John McCain if he supports

government investment in Chrysler and GM, and if he does how is that not socialism?

No of course they won't, or if one of the yakkers slips and does ask him, whatever lies and bullshit come out of Gramps' mouth will pass unchallenged through the ether.

Oh we are just engaged in a partial nationalization of the automobile industry, nothing to see here, not socialism, not at all.

Lying sacks of putrid shit.

[bulloney]

20. Pretty convenient for McCain that he pulled out of Michigan and would not have to face this question

at ground zero of the auto industry. I think there's a part of him that would support such a package for a GM and Chrysler bailout, but his "socialist" rhetoric over the past few weeks painted him in a corner that he can't get out of.

[Sen. Walter Sobchak]

11. these worthless corporations need to hurry up and die

the "good union jobs" argument is a strawman when a corporation has become so utterly worthless that its continued existence only poisons the rest of the industry,

[Dover]

12. I think these bailouts should be on the ballot for a vote.

That would also force more public discussion and transparency regarding these backroom deals.
As it is, none of those actually funding this transaction has been invited to the table...
that would be us.

Cerberus is a shady outfit.

[armed_and_liberal]

14. 72 months @ 9% interest, same as the poor suckers who bought GM's SUV's

fair is fair they pay they same as everyone else!

[defendandprotect]

15. We need electric cars -- not monopoly car mfgs with allegiance to oil industry--!!!

[WriteDown]

23. And who is the only company coming out with a fully......

Electric car in the next two years?!? GM with the Volt.

[defendandprotect]

26. And you're grateful for this at long last? Why do you think they didn't mfg it before this?

Obviously because they've been working for oil industry, not consumerws ---

not environment --

They also crushed thousands of beautiful, high performance electric cars in California

---- for what purpose other than to please oil industry?


And how much bail out money between this Volt and all the years of gas-guzzlers and

environmental damage?

[blue_onyx]

32. Yes, the car companies are to blame

But the government played a part in this mess too. They allowed SUVs to have the fuel efficiency standards of trucks even though most people used them as cars. The government got rid of the law in California that required companies to sell some vehicles with no emissions. Government was part of the problem and helped create this mess...why shouldn't they help clean it up?

[defendandprotect]

36. You're simply talking about the same corruption .. .. oil industry buying gov't officials. . .

Corrupt government/corrupt officials have to be held responsible --

HOWEVEVER, a "people's government" did not have this intention --

and the public shouldn't pay --

Those responsible for these outrageous programs and huge profits should pay ---

Meanwhile, what we bailout we should own ... lock, stock and barrel ---

Nationalize the banks we bail out -- nothing less!


California's rules were overturned thru corruption --

And the bill is about to land on the table for Global Warming ---

If you think this economic disaster is a shock to the public now wait until they

figure out how close we are to losing our ability to survive on this planet --- !!!

Again, thanks to capitalistic corruption, exploitation and oil industry!!!



Indeed, the oil industry played a large role in the assassination of JFK --

which we should really think about more as the coup on our government --- !!!

[WriteDown]

34. Uh....

There were tons of reasons. SUV's were all the rage. The EV-1's were very expensive to manufacture. They had drive-train problems. Battery technology was worlds behind what we have now, etc, etc, etc. Yes, I am grateful that they are the only ones pursuing this.

[CRF450]

37. Sooo... Why does Toyota build trucks and SUV's too?

They dont get any better than the ones from the domestics. Same deal for their luxury and high performance cars.

I'm sorry but the EV1 was a piece of crap. As far as what I see, the imports dont have anything to match the range of the Volt.

[geomon666]

16. Fuck em!

I know the employees will get the shaft (as always) and I truly feel bad for those people, but enough is enough. No more fucking corporate handouts that don't do dick for the American worker.

[madrchsod]

17. i think these companies should go out of business

we need close these companies so that a half a million people out of work with the possibility of never making a decent wage in their lifetime. i`ll be happy to know that my daughter will no longer be making 14 dollars an hour and can compete with with thousands of others for a minimum wage job.

yes let`s kill our auto industry........

[defendandprotect]

27. Let's raise auto production which will replace these jobs and wages while NOT

rewarding a corrupt industry aligned with the oil industry--!!!

We can create GREEN auto manufacturing -- electric carws --- and jobs.


IN FACT, the bail out money would pay these wages --- !!!

[madrchsod]

33. yes that would be a far better idea than giving the money to the banks

if half the "bail out" would go for direct investment into the united states we would`t have half the problems we are facing....but there`s a war to win and a banker who needs a new mansion

[defendandprotect]

35. We also have to decide that war is something we can't afford --

neither by the dollar nor by nature ---

We need to take hold of males --- end patriarchy -- and stop blowing things up!

[antimatter98]

18. NO to this giveaway of our tax dollars.

GM and Chrysler have squandered profits, laying off workers, not building the cars and trucks
that Americans need and so I say NO to any bailout, gifts to the two poorly run corporations.

GM and Chrysler over the years have bailed on their workers, and I see zero reason for
us, the same people they laid off, to bail them out.

GM made a deal with China's Shanghai (yes the city that runs a successful car company) Motors
to build a Hydrogen powered car. They sure didn't partner with Detroit, or the American
worker!

Let GM and Chrysler go down. R.I.P. to these stone age corporations.

If we invest in a car company, let's found a new one that doesn't have stone age
management, invest in this new company for cars of the future, not GM or Chrysler, companies
that have shown us they do not care about America or the American worker.

American worker to GM/Chrysler: Drop Dead.

[Connonym]

19. Only after the working class gets our bailout

[Jacobin]

21. Welfare queens?

[Alcibiades]

22. This is the first step towards nationalization

Let them do it. Pay the CEO at the rate of a GS-15. We're already on the hook for a trillion in Wall Street losses, so I think they should go for it.

But this deal should wait for the next president.

[Phred42]

25. We need to Nationalize the Fossil Fuel Companies First

Why do we continue to Nationalize the LOSERS.

Let's Nationalize the money makers first

[defendandprotect]

28. Why do we continue to NOT hear questions like this of the candidates?

No question re nationalizing oil industry --

nor electric cars --

little on seriousness of Global Warming!!!

[Phred42]

24. Only if the entire Board and Sr. Management are Jailed

and it includes forfeiture of 90% of all personal assets

[defendandprotect]

29. Right . . . and use bail out money to pay employee wages and create new GREEN autos ---

[blue_onyx]

30. To this plan I say NO

It's not the bailout I oppose, it's government funding the elimination of at least 30,000 Michigan jobs. I don't mind them helping GM and Chrysler but I don't want them funding a merger. I don't think a merger is a good idea. Helping them become stronger, separate companies is ok.

I hope the people who are posting that government shouldn't help at all (with or without a merger) also opposed the the Wall Street bailout. The problem with the government bailing out Wall Street, now they almost have to help all other industries/companies in trouble.

[SOS]

31. Time to reintroduce Carter's CAFE standards

If the government buys $3 billion in preferred stock, they must demand improved CAFE.

[Snazzy]

38. Or maybe we get a stake in Toyota

Or just fund Toyota's takeover.

Just want to cross link this new post about GM going to Toyota for some sort of merger/bailout/whatever.

Maybe the Toyota stuff is bogus and is pressure to get taxpayer moola?

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x3572609