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Nickdfresh
11-20-2008, 06:44 AM
What if GM goes broke?

Neither a bailout nor bankruptcy may save General Motors or the other Detroit automakers. So imagine the cost of losing GM, starting with millions of jobs.
By Michael Brush

...

Soon we may wave goodbye to a true American legend: General Motors (GM, news, msgs).

Yes, it's almost unthinkable that this century-old industrial giant could go the way of the DeLorean. But the maker of Chevys, Buicks and Caddies has been driven to the brink by lousy management, intransigent labor unions, high gas prices and an economic slump that has kept Americans off showroom floors.

GM cars are selling so poorly that revenue plummeted 45% in October. Its stock has slumped to levels not seen since the days when it introduced power steering. Cash flow has dried up to the point where 2009 could be the year that GM dies.

The government is debating a bailout for GM and its Detroit brethren of about $25 billion. But cash alone wouldn't save GM, Ford Motor (F, news, msgs) or Chrysler, a trio that can only facetiously be called the Big Three anymore.

Politicians would have to find the guts to stand up to the labor unions and the retirees taxing the companies' resources. They'd have to find the courage to boot out the managers who led the automakers into this mess. Without those changes, a bailout would just be a bandage.

The alternative, using bankruptcy to slough off lenders and reorganize the way airlines have done, might not keep automakers alive either. Unlike an airline ticket, a car is a long-term purchase. Consumers say they wouldn't buy a car from a company in bankruptcy because they worry that warranties and replacement parts might not be there when they needed them.

If I had to bet, I'd bet on a bailout -- either right away in a vote on a loan package that could come in Congress as soon as this week or after Barack Obama takes over as president Jan. 20. But let's hope real change comes with it.
The stakes are huge
Imagine the potential ramifications of losing just GM, the biggest of the Big Three.

Millions of jobs: General Motors employs 123,000 people, and losing those jobs would be bad enough. But GM's demise could set off a chain reaction that might cost the country almost 3 million jobs. Here's how.

General Motors regularly owes auto-part suppliers such as Delphi and American Axle & Manufacturing (AXL, news, msgs) lots of money. If GM declares bankruptcy, a court could relieve GM of its obligation to pay off its debts to those suppliers, which could topple them. The death of GM could have a similar effect in the longer term.

"The ripple effect could be huge," says Van Conway, a bankruptcy expert at Conway MacKenzie & Dunleavy in Birmingham, Mich., who has worked on restructurings and turnarounds in the auto sector.

"If General Motors goes down, their supply base will go down," agrees Brett Smith of the Center for Automotive Research. That might disrupt production at Ford and Chrysler enough that those two car companies would fail as well.

In this disaster scenario, the upper Midwest could lose nearly 3 million jobs, the Center for Automotive Research calculates. It estimates the Big Three automakers employ about 240,000 workers. The car business supports an additional 974,000 jobs among suppliers and related companies, and 1.7 million jobs are created by all the money all those people spend.

Sure, foreign automakers with U.S. factories, including Honda Motor (HMC, news, msgs) and Toyota Motor (TM, news, msgs), would pick up some of the slack. But many of the cars they sell here, such as the hybrid Prius, are made abroad. So these companies wouldn't do enough hiring to offset all the job losses, and they generally pay workers less.

The hit to the consumer: Yes, we'd all lose the option of buying GM favorites like the Malibu or the Silverado. You'd hear no more romantic songs about pink Cadillacs or red Corvettes.

But more seriously, the loss of domestic auto companies would cut the number of producers, which means less competition. The remaining automakers would raise prices, at least in the short term, predicts David Thomas, a senior editor at Cars.com. "You would be paying a lot more for a Toyota Corolla than you ever thought you would be paying."

...

"That is one way they keep their costs low," says Thomas, of Cars.com. So a GM failure would be another blow to an ailing industry already hit hard by subscription and revenue.
The cost to government: Lost jobs and lower wages means lost tax revenue. Federal, state and local governments would lose more than $156 billion in the three years after a failure of the Big Three in Detroit, the Center for Automotive Research estimates. That's money that other taxpayers -- or their children -- would have to make up.

The demand for government services would likely rise as well, as many of the best-paid blue-collar workers in America started job hunting in a weak economy. Auto-sector pensions would have to be picked up by the government -- a huge cost. And both autoworkers and the automakers' retirees would likely need help with health care just as Obama and congressional Democrats were looking for ways to cover the uninsured.

The political cost: If one or all of the Big Three auto companies failed in the first year of Obama's presidency, it could leave voters disillusioned, wiping out much of the good will he has built up and making it harder for him to lead on other issues. The loss of General Motors would also be a hit to our prestige as a nation. Americans share a passion and pride in their cars.

Practically, losing millions of good jobs will make it the task of turning this economy around that much tougher. Letting GM die is not something any politician would want to answer for.

The problems run deep
How did GM get into this mess? Politicians need to understand the problem if they are going to help get GM out of it.

Reason No. 1: missing the trends. Consumer ratings and car reviews confirm that the quality problems which once plagued Detroit are long gone, Morningstar analyst David Whiston says.

Yet many American consumers are now loyal to foreign brands, a sea change from Detroit's good old days. Why is this? Because foreign car producers such as Toyota do a better job of knowing what consumers want and using innovation to get there, says Steve Spear, an expert on the auto sector who is a senior lecturer at Massachusetts Institute of Technology.

While General Motors focused on churning out gas-guzzling SUVs and the Hummer over the past two decades, Toyota was watching subtle shifts in consumer desires and applying technological innovation to develop a fuel-efficient hybrid car. The result: Toyota's Prius is a big hit while GM's Volt is still stuck on the production line, Spear says.

To GM's credit, its fleet includes the largest number of vehicles that get better than 30 miles per gallon. Yet GM made another tactical blunder in this area: It has put fuel-efficient cars low on the list of models getting upgrades over the past few years. The upgrades made its larger cars more competitive, Cars.com's Thomas says, but left GM without desirable fuel-efficient cars when gasoline prices spiked this year. That drove consumers to foreign competitors.

Reason No. 2: costly labor. Give credit to the United Auto Workers for agreeing over the past few years to big job cuts, a transfer of retiree health care to company-funded trusts and other concessions that will bring down wages.

But despite these changes, UAW employees are still an elite group. What other employees get rich perks like 95% of wages when laid off, tough job-security measures and rich retirement benefits without having to put a penny into a 401(k) plan?

JPMorgan Chase analyst Himanshu Patel estimates GM has had to pour $103 billion into employee pension and retirement health care plans since 1992 -- money that could have been used to fund much-needed restructuring, research and product development.

Unions will have to give up more to make GM competitive with Toyota and other nonunion automakers.

Reason No. 3: poor market timing. For some reason, GM managers failed to raise money during the peak of the credit bubble, as Ford did, or late last year right after it had a groundbreaking labor agreement in hand, or even last spring before auto sales nose-dived, points out Patel. Now it's too late, and GM is in a cash crunch.

Indeed, there has been speculation that GM will have a hard time lasting until Obama takes office without a bailout.

The bankruptcy solution
Notice something about these three problems? You can trace them all back to management and the UAW. But GM chief Richard Wagoner has indicated he doesn't plan to leave, and the unions have rejected the idea of making major concessions to get government aid for GM.

That's why bond market vigilantes such as John Lekas at Leader Capital Management in Portland, Ore., believe bankruptcy has to be a part of any bailout plan for GM. "You need a changing of the guard over there," Lekas says. "To give them $25 billion without bankruptcy is nuts...

In bankruptcy, new management could be brought in -- a typical maneuver in Chapter 11. The tricky part is who would select the new management team. It could be a government oversight panel that gets help from outside consultants and debt holders.

In bankruptcy, GM could offload its pension obligations to the Pension Benefit Guaranty Corp., which would pay employees only a fraction of their expected benefits. And if both management and unions bargained in good faith but hit an impasse, a court could force big changes on the union, including lower wages and a streamlining of workplace rules, says Stephen Selbst, a bankruptcy expert with the New York-based law firm Herrick, Feinstein.

Link (http://articles.moneycentral.msn.com/Investing/CompanyFocus/what-if-gm-goes-broke.aspx)

Chevan
11-20-2008, 07:22 AM
What if GM goes broke?
.....
Soon we may wave goodbye to a true American legend: General Motors (GM, news, msgs).
Don't worry.
"Logovas" might supply the America by Ladas:)
Of course if CHina don't ruin the Russian car concern first:)

Nickdfresh
11-20-2008, 07:25 AM
And "Logovas" that produces a Ladas might survive the GM:)

I think GM will survive GM.

But it's going to take a combination of bankruptcy and gov't intervention to fix the inherent problems of gross mismanagement, coddled Union labor contracts (and I'm a very pro-union type lefty, it greatly pains me to say this, but it's the truth!), and GM's tendency to try to create and manipulate the market for their own benefit rather than reacting to it...

Incidentally, I've read Chevy does well in Russia, and Buick is the rage of China! That's their future, and their only hope...

Rising Sun*
11-20-2008, 07:54 AM
I think GM will survive GM.

Possibly. Maybe probably. It might be too big for your government to allow to collapse. For the time being.

We've just sunk millions of taxpayer dollars into keeping our (mostly your ;) and Toyota) car industry alive, which in due course will prove to be a waste of money by a dumb government which hasn't learnt anythng from all previous wastes of my taxes to socialise capitalist losses while never bothering to socialise their profits, the tax avoiding bastards the capitalist corporations are!

However, a while ago I read a (in my primitive financial market and economic understanding terms) highbrow article explaining how CDS (credit default swaps) would bring the world economy down as the third or fourth wave in the current collapse. It used GM as an example and showed how there would be a cascading effect through various national economies if GM went into Chapter 11 or just went bust. Now we might get to see if it's so. (if so, this will make the author a legend as one of the few who managed to predict anything correctly in the current disaster! :rolleyes: )


But it's going to take a combination of bankruptcy and gov't intervention to fix the inherent problems of gross mismanagement,

Why should the government, using the taxpayer's dollars, bail out a bunch of incompetent arseholes who've plundered the company for obscene executive benefits while avoiding every bit of tax they could?

And the answer is because, like it or not, it's the old story that if you owe your bank $100,000 and can't pay you have a big problem, but if you owe it $100m the bank has a big problem. The figures in the current disaster are so far beyond that that the nation has a problem, caused by the modern capitalist scum who plunder public companies for their own benefit and return little profit to their shareholders while often screwing their workers.


I'm a very pro-union type lefty

Me, too. But the unions here didn't create the system which pays those who do least the most and, now, expect the taxpayer to dig these incompetent selfish morons out of the shithole they've created.

BriteLite
11-20-2008, 09:45 AM
Yesterday the ceo's of the Big 3 flew to Washington asking for help. It was revealed these great thinkers of industry chose to travel on corporate jets costing and estimated $20K each. Brilliant.

My theory has been that big US business would take the bailout and continue business as usual. The week Congress approved the $700 billion funding several Wall Street firms celebrated with parties costing upwards of $500K and "seminars" as costly. The action of the automotive ceo's reinforces my thinking.

The US economy requires assistance. Simply writing checks to continue what has proved unwise decision making will delay the inevitable. The process that drives and executes business planning demands a change in approach.. Officers can reap financial rewards based not on performance but on guarantees. Not to say the total blame is on management. Many other factors to consider. But they are in charge and “change” must begin some where. As of this date I am not aware of any press relating to restructuring the payment of bonus monies.

Perhaps a better place to begin the makeover of the US economy is with the Federal budget and the financial packages of elected officials. I “repeat” my demand for Federal legislation requiring a balanced budget. And has anyone discussed how the $700 billion bailout will be funded? Regarding the package politicians have blessed themselves with, that financial package is among the most employee friendly I have seen. Individuals who dedicate some years to public service should be rewarded. A stint in Washington should not be a lifetime award.

My apologies to the Nick for going beyond the scope but discussions of the “bailout” really touch a nerve.;)

mavericck
11-20-2008, 10:19 AM
They need tough love.

mike M.
11-20-2008, 10:46 AM
If GM would bring back the 62 Corvette with all the new modern brakes and such..it would have a hit on its hands. I would buy one!!

herman2
11-20-2008, 11:38 AM
GM should concentrate on manufacturing bicycles and motorized fuel efficient mopeds. GM has failed to see the demand in this field. If they are to survive they must face reality and invest in things the American people want:Bicycles

Churchill
11-20-2008, 03:16 PM
I'm sure that's what Americans want. I live in The States, and when I moved here 11 years ago, I saw tonnes of SUVs, and very few cars(non-gas-guzzling behemoths), then, I saw an increase in cars, and a decrease in SUVs. Now, I see an increase in SUVs.

America makes me feel smart, and I wonder why the Hell they do what they do. At least when gas is 200<x a barrel, Europe has public transportation, which I see the USA lacks in. If they need to go to the store, they get in their .002 mile/gallon SUV, when they could easily walk there in two minutes...

Oh my! My anti-America/American side is strong today!

herman2
11-20-2008, 03:25 PM
As long as we can drive to our McDonalds to eat our Big Macs, everything will be alright...

navyson
11-20-2008, 06:17 PM
Oh my! My anti-America/American side is strong today!

Churchill,
If you moved here at 4 and been here 11, you're for all intents and purposes an American. So....NO ANTI-AMERICANISM!:D

(I assume you all emigrated?)(From let me guess?)

Churchill
11-20-2008, 07:03 PM
I am strongly anti-American against their policies. Most Americans, I have no problem with, many I am good friends with, but people who voted McCain instead of Obama, only because Obama is black, I wish to drive an ice pick though their spleen, out their left nose hole...

navyson
11-20-2008, 07:14 PM
Churchill,You know I'm just kidding.

Did you all emigrate from your namesake?

Major Walter Schmidt
11-20-2008, 07:29 PM
I am strongly anti-American against their policies. Most Americans, I have no problem with, many I am good friends with, but people who voted McCain instead of Obama, only because Obama is black, I wish to drive an ice pick though their spleen, out their left nose hole...

That sounds like Guantanamo.
http://www.notmytribe.com/wp-content/uploads/2008/07/bush-gov-does-not-torture.jpg

tankgeezer
11-20-2008, 08:24 PM
There is the parable of the rowboats,one, owned by toyota, had 8 men in it, one coxwain with his megaphone, directing 7 oarsmen. The other, owned by G.M. had also 8 men, 7 coxwain, and one oarsman. The Toyota boat was very efficient, with its one director, and 7 men powering the craft to great speed, with synchronous, fluid motion, and a clear view of the task to be accomplished.
The G.M. boat however was a chaotic frenzy of 7 directors, (a committee) arguing when was it best to holler "stroke", was "stroke" a proper command, and who thought up the idea of using "stroke" to begin with, and finally who would be the one to give the order to do so.When all of these questions were decided, then came the arguments as to who would begin the chain of management decision to give the command, and so on down to the one who would tell the single oarsman to pull.
All the while the toyota boat, singular in its purpose was making way toward to finish line, while the chain of command on the G.M. boat was just issuing the first order to the rower. And, mightily did he heave, and pull at the oar,,(no jokes please...) only to find his efforts wasted by the burdensome number of directors. It is apparent who won the race, and painfully obvious why they won it. The G.M. boat owners said we must do something, we must have more meetings, and keep more charts, and spent alot of time seeing to these magic talisman so that we may triumph. The oarsman said, I have much to do today, why must I go to a meeting? the wisemen of G.M. answered saying, "because it is mandatory", And, asked the oarsman, must I keep 6 charts when I have work to do? again the answer was, "because it is mandatory" The oarsman scratched his head, and asked where does the time come from to do these things? and was answered, "from production, because that is not mandatory" So finally, the one oarsman, seeing the water rise within the boat, decided to swim for it. G.M. has been stymied by its huge burden cost,A rigid, centralized management system, too much middle management, the level least needed because it is the least productive, and adds no value the the processes it oversees. They cannot lead, only manage. And usually it manages to lose money.

Nickdfresh
11-20-2008, 09:13 PM
...

Why should the government, using the taxpayer's dollars, bail out a bunch of incompetent arseholes who've plundered the company for obscene executive benefits while avoiding every bit of tax they could? ...



Well, part of the answer to that is the US federal gov't is inevitably going to bail SOMEONE out. The reason being is that the autoworkers' pensions are guaranteed, meaning that if GM fails, then taxpayers are on the hook for the generous pension plans...

No matter what, we'll be paying!

Nickdfresh
11-20-2008, 09:18 PM
I'm sure that's what Americans want. I live in The States, and when I moved here 11 years ago, I saw tonnes of SUVs, and very few cars(non-gas-guzzling behemoths), then, I saw an increase in cars, and a decrease in SUVs. Now, I see an increase in SUVs.

America makes me feel smart, and I wonder why the Hell they do what they do. At least when gas is 200<x a barrel, Europe has public transportation, which I see the USA lacks in. If they need to go to the store, they get in their .002 mile/gallon SUV, when they could easily walk there in two minutes...

Oh my! My anti-America/American side is strong today!


Oh my it has CHANGED!! The values of SUVs in America have plummeted and they all have massive incentives on them at dealerships. And over the summer, you couldn't even purchase a Honda Civic, Toyota Corolla, Prius, Mazda3, and even the domestics were short of Cobalts (GM's rehashed old Astra for you Euros) and Ford Focuses (the old one, not the redesigned one that again, you Euros drive --we don't get that until 2011! :mad:)...


It's all relative to gas prices. But now that petrol has come down, Ford is making more F-150 pickup trucks again. :rolleyes:

Nickdfresh
11-20-2008, 09:19 PM
As long as we can drive to our McDonalds to eat our Big Macs, everything will be alright...

Um, what are you pissing around about?

If GM fails, Canada is as screwed as the US is!

tankgeezer
11-20-2008, 11:41 PM
I'm sure that's what Americans want. I live in The States, and when I moved here 11 years ago, I saw tonnes of SUVs, and very few cars(non-gas-guzzling behemoths), then, I saw an increase in cars, and a decrease in SUVs. Now, I see an increase in SUVs.

America makes me feel smart, and I wonder why the Hell they do what they do. At least when gas is 200<x a barrel, Europe has public transportation, which I see the USA lacks in. If they need to go to the store, they get in their .002 mile/gallon SUV, when they could easily walk there in two minutes...

Oh my! My anti-America/American side is strong today!
If you live in the U.S., then you know there is little within 2 minutes walking of most all residential housing with the exception of urban dwellers. I live in the burbs, and the nearest store is nearly 30 minutes by foot.(lots of fun in the winter. ) We have little pubtrans because no one uses it. I have seen many buses, with 4-7 people on them, burning gobs of diesel to run around nearly empty.(this is because most folks drive.) as to cars, I drive what I want to. Other people can drive what they want to. Few Americans want bicycles. Being a young gentleman, you have no responsibilities for kids, job, grocery and other shopping, and all of the other things adult are responsible for. When its your turn to shoulder the burden, you may find yourself at the wheel of a large vehicle, because you have to have it to fulfill your responsibilities of manhood, husbandry, and fatherhood. Till then, feel free to think up something new, and innovative to replace what we have now.

tankgeezer
11-20-2008, 11:45 PM
As long as we can drive to our McDonalds to eat our Big Macs, everything will be alright...
If you are eating regularly at Mc D's, you may not live long enough to face an environmental crisis. Are you old enough to drive?? :)

mike M.
11-21-2008, 09:13 AM
I'm sure that's what Americans want. I live in The States, and when I moved here 11 years ago,

Just curious..why do you have your LOCATION as Guildford England..but then you say you live in the States? I know what you mean...Now I'm starting to feel smarter..:)

mike M.
11-21-2008, 09:17 AM
but people who voted McCain instead of Obama, only because Obama is black, I wish to drive an ice pick though their spleen, out their left nose hole...


How do you feel about people who voted for him ONLY because hes black?

tankgeezer
11-21-2008, 10:04 AM
I am strongly anti-American against their policies. Most Americans, I have no problem with, many I am good friends with, but people who voted McCain instead of Obama, only because Obama is black, I wish to drive an ice pick though their spleen, out their left nose hole...

Young Mr. Churchill, (assuming you are young as you have said,) lighten up on the creepy ice pick stuff.

Churchill
11-21-2008, 03:08 PM
Just curious..why do you have your LOCATION as Guildford England..but then you say you live in the States? I know what you mean...Now I'm starting to feel smarter..:)

Guildford is where I was born.;)

And TG, blame George Carlin... :lol: He's so funny...

Nickdfresh
11-21-2008, 04:16 PM
How do you feel about people who voted for him ONLY because hes black?

Which would have been a far smaller percentage than those that didn't vote for him because he was black...

Panzerknacker
11-21-2008, 04:25 PM
I think the downfall of all the automotive and also other medium and heavy US industries in the excesive mania to close down a factory in the US and open one in Mexico or other foreign country.

For example all the tools available in the supermarkets near my home (Wal-mart & Carrefour) are 95% made in China , despite the brand Snap-on and Stanley, both typically american firms.

A industrial job lost in the US is a person who have to live from a less payed job ( probably in the service area) and in that way he got less chances to adquire a new vehicle.

The US entrepeneurs should be more " patriotic" in my opinion.:rolleyes:

tankgeezer
11-21-2008, 05:29 PM
I think the downfall of all the automotive and also other medium and heavy US industries in the excesive mania to close down a factory in the US and open one in Mexico or other foreign country.

For example all the tools available in the supermarkets near my home (Wal-mart & Carrefour) are 95% made in China , despite the brand Snap-on and Stanley, both typically american firms.

A industrial job lost in the US is a person who have to live from a less payed job ( probably in the service area) and in that way he got less chances to adquire a new vehicle.

The US entrepeneurs should be more " patriotic" in my opinion.:rolleyes:
I agree in totto my friend. The sad truth is that the management of many large U.S. firms see only $$, and think in the short term. They do not care about how they make the money, or what will become of the places they close up. The corporation I retired from used pension fund $$ to bankroll building projects in Asian countries, (interest free loan) .Then when completed, they placed the money in the pension fund, and then said they could not compete with the global industry, and threatened to fill ch.11 bankruptcy. (this way, they could try to break their contracts with suppliers, and the unions, and shift production to their new Asian facilities, which legally, are separate from the parent U.S. business.) Such behavior is in my opinion, detrimental to the economy, and security of America.

Panzerknacker
11-21-2008, 05:44 PM
They do not care about how they make the money, or what will become of the places they close up

Many people with socialist ideas take that examples as the downfall of the capitalism, but I dont see that as capitalism but cannibalism.

All that monetary maneouvres are ininteligible for the persons like me who are used to receive money as the result of their hard work. Of course seems that "hard work" is not a very popular between some north american CEOs.

Rising Sun*
11-22-2008, 06:25 AM
I agree in totto my friend. The sad truth is that the management of many large U.S. firms see only $$, and think in the short term. They do not care about how they make the money, or what will become of the places they close up. The corporation I retired from used pension fund $$ to bankroll building projects in Asian countries, (interest free loan) .Then when completed, they placed the money in the pension fund, and then said they could not compete with the global industry, and threatened to fill ch.11 bankruptcy. (this way, they could try to break their contracts with suppliers, and the unions, and shift production to their new Asian facilities, which legally, are separate from the parent U.S. business.) Such behavior is in my opinion, detrimental to the economy, and security of America.

I hate to disillusion you, my Yank mate, but this is just one more area where America has lost the lead. ;) :D

Down here, we've increasingly been exporting our jobs to the cheap labour (alright, labor :o) countries for the past thirty or so years. We can't even manufacture a lot of our own basic needs. This, apparently, is regarded by our political and commercial leaders as a great national advantage for which the Australian populace should be grateful, despite us getting inferior products as a result :confused:

pdf27
11-22-2008, 11:13 AM
Down here, we've increasingly been exporting our jobs to the cheap labour (alright, labor :o) countries for the past thirty or so years. We can't even manufacture a lot of our own basic needs. This, apparently, is regarded by our political and commercial leaders as a great national advantage for which the Australian populace should be grateful, despite us getting inferior products as a result :confused:
All depends on what you're actually doing. Some things will never be cheaper to make in the first world than in China/India, and hence there is never any point trying to retain them. Others (and the branch of Engineering I work in is one) cost the same no matter where in the world you make them. For the project I'm currently working on, the labour cost of assembling it is around 0.3% of the retail price. At that rate, you're always going to make it in the place which gives you the highest quality because the savings from moving elsewhere are so tiny. It's all down to automated machine tools, proper design for manufacture (the whole reason Toyota are such a successful company - while they are happy to talk all day about lean manufacture, that's only perhaps 10% of the reason they can make things so well. Designing a product which can be manufactured cheaply is immensely harder, but if you can do it right the results are brilliant) and generally designing for low part count.

Nickdfresh
11-22-2008, 05:55 PM
All depends on what you're actually doing. Some things will never be cheaper to make in the first world than in China/India, and hence there is never any point trying to retain them...

Windmills being one of those items. Some are predicting up to three million US manufacturing jobs to build the wind power generation that America sorely lacks...

pdf27
11-23-2008, 01:57 AM
Maybe. You´ll have to work at it to be sure however - a lot of the work involved at the moment is very human intensive, composite layup. There are machines which can do it, but until you start using them you won´t be competitive.

Rising Sun*
11-23-2008, 05:19 AM
All depends on what you're actually doing. Some things will never be cheaper to make in the first world than in China/India, and hence there is never any point trying to retain them.

There is a point to trying to retain them for defence purposes.

If Australia went to war with China, we wouldn't be able to produce most of our own clothing and footwear, not to mention lacking a lot of potential defence-related industrial capacity we've lost to China and other low cost countries.

It's doubly disappointing that Australian governments and businesses have forgotten that in many respects we were in a better position at the start of WWII. A painful lesson we learnt during that conflict was the need for industries which gave us some degree of defence industry self-sufficiency. Shortly after the war, we embarked on a course to achieve that. The quest for low production costs over the past few decades has wiped out a lot that was achieved in the preceding three.

herman2
11-25-2008, 12:55 PM
Um, what are you pissing around about?

If GM fails, Canada is as screwed as the US is!

Um, If USA fails due to GM then thats too bad. Canada will survive though cause we have FREE Healthcare, a great welfare and unemployment program and we are not going down the dumps as fast as America in case you haven't noticed. Canada is far better off than America for now.We aren't bailing out our banks like Bush is doing. We have new hyundai and Honda plants openeing every year, employing Canadians. If GM fails, sure we will suffer but not to the extent that America will. So don't piss on me.:army:

Nickdfresh
11-25-2008, 06:25 PM
Um, If USA fails due to GM then thats too bad. Canada will survive though cause we have FREE Healthcare, a great welfare and unemployment program and we are not going down the dumps as fast as America in case you haven't noticed. Canada is far better off than America for now.We aren't bailing out our banks like Bush is doing. We have new hyundai and Honda plants openeing every year, employing Canadians. If GM fails, sure we will suffer but not to the extent that America will. So don't piss on me.:army:

Is belligerent Canadian nationalism your new troll angle?

Firstly, I was referring to how many GM manufacturing plants are located in Canada. The US will not "fail" if GM does, and it is still arguable that GM can actually fail as they still have a lot of assets, are not even readying themselves to go into bankruptcy, and they will probably survive in some form...

Incidentally, the US ALSO has a lot of Hyundai-Kia, Honda, Toyota, Mazda, etc production facilities. In fact, some of the biggest anti-bailout partisans are in southern states with these very companies in them...

Ontario WILL suffer if GM were to fail completely and your economy is entirely dependent on ours as the US and Canada are still the largest trading partners...and Canada is also in a full recession.

I watch the Canadian news too!

Churchill
11-25-2008, 06:57 PM
*Gasp*

Hush down Herman! He'll know of all our evil plans!

Rising Sun*
11-25-2008, 07:41 PM
Is belligerent Canadian nationalism your new troll angle?

You'd better hope not.

The last time the Canucks went feral they burnt down the White House. ;) :D

Nickdfresh
11-25-2008, 07:56 PM
You'd better hope not.

The last time the Canucks went feral they burnt down the White House. ;) :D


HA!! They burned my home city after we burned Hermy's current abode...;)

tankgeezer
11-25-2008, 08:12 PM
Thats okay,the current target package: Beta India-12 contains many of Canada's major resources, underground Moosehead cisterns, Bacon mines,and the strip club bunkers.

Churchill
11-25-2008, 09:17 PM
Beacon mines

Did you mean to say bacon? :)

Rising Sun*
11-25-2008, 09:30 PM
Thats okay,the current target package: Beta India-12 contains many of Canada's major resources, underground Moosehead cisterns, Beacon mines,and the strip club bunkers.

Are those the strip club bunkers with big hooters for air raid warning sirens?

tankgeezer
11-25-2008, 10:40 PM
Did you mean to say bacon? :)You are correct young Sir, but in truth, one might fry his bacon over a beacon,,,,:)

tankgeezer
11-25-2008, 10:44 PM
Are those the strip club bunkers with big hooters for air raid warning sirens?
Yes, they are, but its the tassels that when spun at high speed(especially in opposite directions) provide the siren function.:shock: (Churchill, you're too young to read this,,, )

Rising Sun*
11-25-2008, 10:56 PM
Yes, they are, but its the tassels that when spun at high speed(especially in opposite directions) provide the siren function.

:mrgreen:

I expect they'd have to stay vertical, as doing it horizontally could induce a helicopter effect?

Rising Sun*
11-26-2008, 05:50 AM
HA!! They burned my home city after we burned Hermy's current abode...;)

Well, viewed in isolation, there does seem to be a degree of fairness in that. ;) :D

tankgeezer
11-26-2008, 08:35 AM
:mrgreen:

I expect they'd have to stay vertical, as doing it horizontally could induce a helicopter effect?
Yes, raises dust,, makes me sneeze. (good thing I have a large bundle of $1 bills....:) )

Churchill
11-26-2008, 12:10 PM
(Churchill, you're too young to read this,,, )

Don't worry my friend, the shampoo commercials in France show naked breasts, honestly, its no big deal. :army:

tankgeezer
11-26-2008, 02:14 PM
Well, I cant be thought of as a corrupting influence, so its blinders for you lad ! :)

Churchill
11-26-2008, 03:32 PM
Nonsense, If you were a corrupting influence, the entirety of France would be a corrupting influence in regard to their shampoo commercials.

tankgeezer
11-26-2008, 04:42 PM
Thats right I forgot,,, "Liberty, Equality, Naked shampoo adds." :)

Panzerknacker
11-30-2008, 04:25 PM
This is also the death of a giant, if anybody here knows about machine tools ...well you know what I mean.


http://es.youtube.com/watch?v=wop2PnwVcsY

pdf27
11-30-2008, 06:02 PM
I do a fair bit, but we only use Japanese, Finnish and German machine tools around where I am (Matsuura mainly). Having said that, we do high-end 5 axis work - looking at their website, South Bend seem to be at the low end, cheap side of the market, and that's a bad place to be with increasing Chinese competition.

Panzerknacker
12-01-2008, 07:19 AM
looking at their website, South Bend seem to be at the low end


The products publicited there have all the look of being a chinese imports with the american brand stamped on it.
The old machines of the 1940s,1950s,1960s have a better finish and quality.

herman2
12-16-2008, 09:13 AM
Is belligerent Canadian nationalism your new troll angle?

Firstly, I was referring to how many GM manufacturing plants are located in Canada. The US will not "fail" if GM does, and it is still arguable that GM can actually fail as they still have a lot of assets, are not even readying themselves to go into bankruptcy, and they will probably survive in some form...

Incidentally, the US ALSO has a lot of Hyundai-Kia, Honda, Toyota, Mazda, etc production facilities. In fact, some of the biggest anti-bailout partisans are in southern states with these very companies in them...

Ontario WILL suffer if GM were to fail completely and your economy is entirely dependent on ours as the US and Canada are still the largest trading partners...and Canada is also in a full recession.

I watch the Canadian news too!

NICK!!..You outsmarted me again. You were so right, despite my defiance....here is today's Toronto Star News article which hits the nail on the head from what you were saying.....(my helmet goes off for you)..

If Big Three automakers go out of business, the entire economy will be devastated, report says
Robert Benzie and Rob Ferguson
Queen's Park Bureau

Dec 16, 2008

Ontario would lose 517,000 jobs within five years if the Big Three automakers went out of business, according to a new provincial report obtained by the Star.

The review, prepared for the Ministry of Economic Development and to be released today, warns the collapse of General Motors, Ford and Chrysler would send lasting shock waves through the economy.

If auto output by U.S.-based manufacturers in Canada were cut in half, at least 157,400 jobs would be lost right away, 141,000 of them in Ontario. By 2014, job losses would rise to 296,000 nationally, including 269,000 here.

If production were to cease completely, 323,000 jobs would be lost immediately in Canada, including 281,800 in this province, rising to 582,000 nationally and 517,000 in Ontario by 2014.

The Ontario Manufacturing Council, an arm's-length provincial government panel, commissioned the 11-page report, which was prepared by the Centre for Spatial Economics. The report paints a gloomy picture if governments at Queen's Park, in Ottawa and in Washington do not bail out the automakers.

"The depreciation of the dollar, lower interest rates, and lower production costs eventually help the economy to partially recover (over the following five years, 2015 to 2019) but the loss of the Detroit Three leaves a permanent dent in Canada's economy in terms of jobs and output," the report says.

"For any Canadians who feel that the auto industry is expendable to our economy, this report is a wake-up call," Economic Development Minister Michael Bryant said in an interview yesterday.

"This report suggests that even under a scenario where half the auto sector is lost, our economy (in Ontario) basically craters and brings the whole rest of the (Canadian) economy with it," Bryant said.

The damage would extend well beyond the auto and related parts industries to housing and a broad range of consumer spending, said Jayson Myers, an economist who is president of Canadian Manufacturers and Exporters.

Myers is a co-chair of the manufacturing council with Jim Stanford, economist for the Canadian Auto Workers union.

"We were surprised how big the impact is. ... It shows the importance of ensuring we maintain production here."

The impact on citizens would be huge, Bryant predicted.

"If the auto industry is somehow allowed to part (from) our economy, it's the equivalent of a nuclear winter with lasting effects ... and would require enormous cuts to public services plus massive deficits every year."

North American automobile demand is already down to 11 million vehicles from a previous 19 million.

"Let's hope that doesn't last long," said Myers. "I'm pretty certain we will see demand rebound, but certainly it won't rebound to 19 million units."

Because automakers have been offering plenty of sales incentives and rebates in the past few years, which eat into future sales, "it's not going to be easy" to get demand up given the economic crunch facing consumers, Myers said.

Nor could Japanese-based automakers like Toyota and Honda, which already build cars and trucks in Ontario, be expected to fill the void left by GM, Ford and Chrysler.