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Posts Tagged ‘big three automakers’

Detroit Auto Industry Is Forever Changed Due to Credit Crunch

LANSING, Mich. — Detroit’s Big Three automakers are forever changed by the current credit crisis, according to a study done by a well-known Michigan economics firm.

The study, from Lansing-based Anderson Economic Group, gives a stark peek into the auto business and reports bankruptcy, radical restructuring and even a merger between two of the auto giants are just a few of the limited options the industry has left.

“Although the metaphor has been abused recently, it is indeed the worst crisis since the Great Depression for the domestic industry,” analysts wrote in the summary of their findings. The study projects annual sales for the Big Three may be less than 10.5 million units.That number is down from 16 million in 2007, a nearly 40 percent drop.

On a more positive note, analysts write in the study that they disagree “with the notion that the entire industry is a herd of ‘dinosaurs’ or that the Detroit 3 do not produce vehicles Americans want.”The next 18 months are both critical and full of possibility for automakers, according to the study.

Congress Gives Citibank Bailout Cash But None for Detroit Automakers

The feds pump another $20 billion into teetering Citigroup Inc. and insure $306 billion in bad assets just days after Congress slaps Detroit’s automakers for failing to table “a plan” to justify $25 billion in loans and folks ’round here cry, “Double standard! Double standard!”

Double standard? You bet, but it’s more than a geographic cabal of coastal Democrats and anti-union, pro-foreign auto Republicans from the South that clearly has it in for Detroit. It’s money and political alliances, folks, neither of which the boys at General Motors Corp., Ford Motor Co. and Chrysler LLC have in abundant supply.

How come Citigroup gets a pass and a big fat check? First, failure of its sprawling operations truly would pose a mortal threat to the global financial system. Second, the banking giant is exceedingly well connected to the campaign wallets of the very same folks — and their allies — who are poised to foist draconian terms on Detroit to keep it afloat.

It gets better. This being Thanksgiving Day, launch Google and type in “Chris Dodd campaign contributions.” Up will pop a link to an interesting site called opensecrets.org, a product of the independent Center for Responsive Politics. Who was the top contributor to Dodd between 2003 and 2008?

Citigroup — or, more precisely, its political action committee, whose contributions totaled $316,494. In the 2008 election cycle alone, Dodd received $157,194 from Citigroup’s PAC. From AIG, he garnered $223,478 between ’03 and ’08, taking in $98,100 this year from the beleaguered insurer propped up by $150 billion of taxpayer money.