The title of the article I chose is, "Big Three Seek $34 Billion Aid: GM, Chrysler Warn of Collapse This Month as Lawmakers Explore Bankruptcy."It can be found at:
I picked this article about the auto industry because, for as long as I can remember, I have been a "car guy." I watch motorsports, read car magazines, I love to draw cars, and (keeping my fingers crossed for GM) hope to own a new Camaro when they are produced.
Some of the points in the article include that GM needs $4 billion to stay afloat this year, and $18 billion total. GM states that it may look to cutting or selling-off brands like Pontiac, Saab, and Saturn, and reducing their debt by $30 billion through consolidating operations and other methods. Chrysler needs $7 billion immediately in order to meet payments, expenses and other cash flow need for the first quarter of 2009. Chrysler says that they will be cutting their workforce and CEO Bob Nardelli will work for $1 in 2009. While GM says that it could break-even (in North America) by 2012, Ford looks like the brightest of the three, claiming it can return to profitability in 2011, in addition to using funds to introduce more fuel-efficient and alternative fuel vehicles.
The first time that the auto industry executives traveled to Washington a few weeks ago, they drew well deserved criticism for flying in seperate private jets, and were unable to secure any financing. As they returned earlier this week, by traveling in company cars touting their latest hybrid or fuel technologies, and additional details were released, giving an even worse outlook for the companies. GM said they could no longer make it to 2009 with the cashflows they currently have, and are banking on recieieving a federal bailout. I am worried for GM because their executives said "there is no plan B." Pundits have thrown around the word bankrupcy with GM for over a year, and their executives still agree that it is not an option. Drastic change is coming to the American auto industry. If not through bankrupcy, then through massive reorganization and structure.
There seems to be new information coming out daily with the auto industry and how they are coping with this historic times. Their survivial is important not only for their stakeholders, but for the rest of the world economy.