More on the auto bailout

Tom Jackson
Mar 23, 2010

Plain Dealer columnist Thomas Suddes, in yesterday’s paper, has an impassioned column arguing that Congress needs to to move quickly to bail out the Big Three automakers.

As Suddes rightly points out, the debate in Congress is largely regional. Saving the domestic carmakers is a much bigger deal in Michigan and Ohio than in much of the rest of the country.

A couple of points: Suddes appears to understate the importance of automaking in Ohio’s economy, perhaps because he chooses to focus on domestic plants, (or, another way to put it, UAW plants.) He mentions that according to the Ohio Department of Development, about 15,000 work for GM, 11,000 for Ford, almost 7,000 Chrysler and almost 6,000 for Delphi. That’s a total of 39,000, with 33,000 making cars and car parts for the Big Three.

Figures for employment in Ohio compiled by labor market economists working for the Ohio Department of Job and Family Services show that in October 2008 some 23,000 Ohioans worked in motor vehicle plants and 73,900 worked in plants that make auto parts — a total of 96,900 Ohioans.

A second point: The number of Ohioans who make a living making cars or car parts has fallen a lot, and likely will continue to drop, regardless of whether Congress takes action.

In 1990, according to the JFS labor market office, there were 140,600 Ohioans making motor vehicles or motor vehicle parts. That’s a decline of 43,700 jobs in 18 years, about 30 percent.

The situation would probably be worse, except for the fact that Honda’s successful Marysville plant employs 5,250 people, and Honda has manufacturing at three other Ohio locations (another 5,700 people). That’s 10,950 people in Honda’s Ohio manufacturing plants, and that figure doesn’t include five other Ohio Honda operations listed on the company’s Web site.

Footnote: U.S. Sen. George Voinovich has released a letter to the Congressional leadership, asking for quick action to hep domestic carmakers.

Comments

Anonymous

I can certainly empathize with the workers, but I think that the Detroit Three are doomed regardless of how much money is thrown at them.

As of Dec.1, look at their stock prices. The market is reflecting their perceived value through their low share prices.

Ford (F): $2.55
(GM): $4.59
Chrysler is privately held.

On the other extreme, Toyota Motor Corp. (TM), was at $58.56.

If you had $1,000 to invest in an auto stock, where would you put your money?

Within my nuclear family, we have owned 14 autos over our lifetimes and ALL of them were American made. I feel that we've done our part.

Anonymous

To All,
This one needs to be forwarded to as many people as possible as a reminder of whom is actually taking care of business at home. I could let this one pass by, considering the recent news and events regarding the Big 3, and what's at stake for current, and future jobs for millions of people, and the risk of losing technological advances, knowledge, and experience of our manufacturing capabilities.

LET EVERYONE KNOW...

For the record...

Ford, Chrysler and GM's contributions after 9/11

An interesting commentary...You might find this of interest:

CNN Headline News did a short news listing regarding Ford and GM's contributions to the relief and recovery efforts in New York and Washington...

The findings are as follows.....

1. Ford- $10 million to American Red Cross matching employee contributions of the same number plus 10 Excursions to NY Fire Dept. The company also offered ER response team services and office space to displaced government employees.

2. GM- $10 million to American Red Cross matching employee contributions of the same number and a fleet of vans, suv's, and trucks.

3. Daimler Chrysler- $10 million to support of the children and victims of the Sept. 11 attack.

4. Harley Davidson motorcycles- $1 million and 30 new motorcycles to the New York Police Dept.

5. Volkswagen-Employees and management created a Sept.11 Foundation, funded initial with $2 million, for the assistance of the children and victims of the WTC.

6. Hyundai- $300,000 to the American Red Cross.

7. Audi-Nothing.

8.BMW-Nothing.

9. Daewoo- Nothing.

10. Fiat-Nothing.

11. Honda- Nothing despite boasting of second best sales month ever in August 2001.

12. Isuzu- Nothing.

13. Mitsubishi-Nothing..

14. Nissan-Nothing.

15. Porsche-Nothing. Press release with condolences via the Porsche web site.

16. Subaru- Nothing.

17. Suzuki- Nothing.

18. Toyota-Nothing despite claims of high sales in July and August 2001. Condolences posted on the web site

Whenever the time may be for you to purchase or lease a new vehicle, keep this information in mind. You might want to give more consideration to a car manufactured by an American-owned company. Apart from Hyundai and Volkswagen, the foreign car companies contributed nothing at all to the citizens of the United States ... and this still holds true to this very day.

It's OK for these companies to take money out of this country, but it is apparently not acceptable to return some in a time of crisis. I believe we should not forget things like this. Say thank you in a way that gets their attention..

BUY YOUR NEXT VEHICLE FROM GM, FORD OR CHRYSLER.

Lynda Mobley, President

North Central Labor Council

mailto:lmobley1@woh.rr.com

Web site: http://oh.aflcio.org/nclc/

419-217-7013

Lynda Mobley

lmobley1@woh.rr.com

419-217-7013

2.1 MILLION STRONG

In Solidarity

Anonymous

I don't think anybody is going to buy a vehicle from The Big Three just because they donated money to the NYPD after 9/11. Most people make purchases based on product value, not the goodwill of a company towards victims of terrorist attacks. Sorry Lynda.

It would be pretty cool if we could fuel our country with "goodwill" but that's just not how it works.

Anonymous

Ask the stockholders of companies if they want the corps. to make donations to charities and I believe that the overwhelming majority would be against it.

Increase the dividend payout and allow the individual stockholders to contribute if they so desire.

Anonymous

$34 billion ain't gonna be enough.

According to MarketWatch.com:

'Mark Zandi, chief economist for Moody's Economy.com, testified that the companies would need $75 billion to $125 billion over the next two years to avoid bankruptcy.'

The time to 'fix' the Bloated Three was thirty years ago.

Instead of focusing on the Chrysler bailout of thirty years ago, look instead at the govt's track record regarding the Conrail mess.

Govt. is lousy at picking profitable winners and losers. The market ALWAYS wins. As an investor, I just try to stay on it’s good side.

Anonymous

Boeing says that it is postponing the delivery of the first 787 Dreamliner by almost two yrs. because of the increased costs and delays brought on by the recent union workers strike.

Kinda of familiar ring?

Prediction: In the near future, Boeing execs will be before Congress begging for a handout due to 'unfair' foreign competition.

Do ya think that the eco-nut-libs get 'em to build an electric plug-in plane for the cash?