Saving the US Auto Industry

[tw]

Originally Posted by Shawnee123

The problem: the other big employers in this area are suppliers. If GM goes down, they suffer. Honda suffers because they are paying more to make up for business the supplier isn't getting from GM...the trickle effect is quite scary.

You have ignored lessons from history. If GM goes down, all those supplies and all those employee jobs are saved. GM then reorganizes. However if GM gets $billions, then those jobs are lost later and supplies go under.

Stated was a fact you should know - Chapter 7 verse Chapter 11. Liars tell us that if GM goes down, that all jobs are lost. Wrong. Wrong are repeatedly demonstrated in history.

Meanwhile, this will do nothing to affect Honda’s part prices. In fact, using basic economics, Honda’s prices will go down. No, prices won’t because of other facts based in a concept called quality – beyond this discussion.

GM has no intention of fixing their problem because of a big carrot - $billions of free money. GM will not fix anything until bankruptcy theats force GM to fix their only problem - Rick Wagoner. The longer Rick Wagoner is there, then Chapter 7 becomes more likely.

We are all expected to learn from history. Next post will provide but another historical example that everyone should know. Again, company saved once the only problem was removed.

[tw]

Why does IBM still exist? John Akers, an MBA, was running IBM into the ground while claiming to be fixing IBM. In 1992, Bill Gates finally understood why he had so much trouble with IBM. 1990s IBM desks had IBM-XT PCs with CGA monitors. No software sold in malls could run on computers in IBM Corporate. John Akers did not even know how to use a computer except for e-mail and stock quotes. He also promoted a myth called computer literacy. Akers was the classic bean counter who stifled innovation (especially in mainframes) and therefore destroyed 100,000 jobs.

How did IBM save itself? From Wikipedia, Louis Gerstner

is credited with saving IBM ... he describes his arrival at the company in April 1993, when an active plan was in place to disaggregate the company. The prevailing wisdom of the time held that IBM's core mainframe business was headed for obsolescence. The company's own management was in the process of allowing its various divisions to rebrand and manage themselves — the so-called "Baby Blues."

Gerstner reversed this plan, ... His decision to keep the company together was the defining decision of his tenure. The subsequent refocusing on the IT services business, the embrace of the Internet as a business phenomenon, and a broad effort to revive the company's culture are widely seen as having resulted in one of the most remarkable turnarounds in business history.

IBM stopped firing employees when Gerstner enabled employess to focus on products.

What is always needed to save a company? 85% of all problems are directly traceable to ... but then how many finally appreciate what everyone should have known long ago.

John Akers became IBM's president in 1983. Therefore ten years of stifled innovation terminated over 100,000 jobs. How does GM fix itself? Their Akers (Wagoner) must be replaced by a Gerstner. However some are so misinformed as to blame employees or unions rather than stifled innovation. John Akers and Rick Wagoner are classic bean counters with no grasp of the product and a denial that they are the problem.

Deutsche Bank has a target price for GM stock at zero dollars.

[monster]

Originally Posted by tw

You have ignored lessons from history. If GM goes down, all those supplies and all those employee jobs are saved. .

if it's just GM, maybe. But if it's all of them, no. We're already hanging on by threads, waiting for the turn-around. We've been there for years. We've done chapter 11 -even survived it. But it will take too long for it to work this time. workers for suppliers are already not being paid but it's not just the suppliers, they're only a little part of it. it's the caf on the corner where the workers eat lunch, the preschools where there kids go, the people who clean their houses, mow their lawns, pack their groceries and ask them if they want fries with that. Half of these went in AA when Pfizer closed. they can't survive another so soon. The company logistics may be following the pattern described by events past, but the characters in this play have different structures and the old framework won't fit and can't be made to. Square peg, round hole. Your ivory tower theories of history repeating itself might be comfortable up where you are, but down here on the ground, we can see that the cows are in fact small and not just far away.

(points for that one, Brits and Britophiles....)