auto discussion: Maybe I'm really stupid, but:

[robinlynne]

Why don't they lower all the car prices by 30% right now, for cash buyers for the next 6 months. the cars are sitting on docks,going nowhere. With a real sale, not 10%, but a real sale, and an agreement with the dealers to take half of the normal percentages they take, but actually sell many more cars....Wouldn't that solve their cash crisis? 14 billion is what they want for 4 months. Aren't there 14 billion dollars worth of new cars sitting around getting dusty? OR why can't the government buy those cars for a much lower price? I'm sure they could be used. no bailout necessary. Done. I don't have the money for a new car, and I never have, but a lot of people would jump at the chance if they were really at great price. then those people sell their used cars, and the economy moves. .
What am I missing?

[FormerDittoHead]

1. I don't know if that can be done. I'd have to go back to the office and ask our manager.

:rofl:

[robinlynne]

4. I'm serious. I have a small card company. I have too many christmas cards, so I lowered the price

considerably to get rid of the last few hundred starting today. that money will pay the bills for the new collection. You do NOT have to make a profit all the time. If they are about to go bankrupt, why not lower the prices, and remove the profit part of the car instead of trying to get rid of the wages par of the car? I think the auto worker wages are more important than the profit.

[JDPriestly]

15. You are right. If they sold the cars at greatly reduced prices, they

could get the car sales moving again. There are ways that this could be done.

Of course, the problem is that Americans are afraid to spend any money and not prepared to buy big ticket items no matter how much they have been marked down. People want to make sure they have enough money to eat if/when they lose their jobs.

A lot of people lost their real jobs years ago, borrowed against their houses to start "consulting" businesses and are now realizing that they will never make a go of it. The biggest portion of foreclosures and sub-prime mortgages involve middle class folks got themselves mired in debt for various reasons including outrageous health care costs and job losses. It wasn't the poor people who got most of the sub-prime mortgages, it was people who look prosperous and who are now trying to refinance.

That's what would prevent this idea from working: fear and the fact that people are already too deeply in debt.

[JohnnyRingo]

11. That was funny

Thanx, I need a good laugh in such dire times.

[Skink]

2. How about offering a 10 year warranty.

These companies are against electric vehicles because they know the car is likely to last 30 years.

[Waiting For Everyman]

3. Senator Mikulski tried to do that a few weeks ago - got voted down.

No. Actually, it got stopped from even getting to a vote. Guess by who? She wanted to pass a sales tax rebate and interest write off for any car sold by the end of the year.

My Senator Barb. :loveya: Check out her great tell-off, she gets really MAD a few minutes in...

http://www.youtube.com/watch?v=FoPruP8yiNM

[robinlynne]

5. ooh that was good! The American people object! Yes we do!

ok. so if the government wants to give them money, how about buying all the cars at 40% off, if the companies alter the cars and make them green. the government would actually get something it can use. I bet there are lots of agencies who don't have cars and can use them.

In the same way, I thought they should buy the foreclosed homes for the new lower market price, not bail out the industry. There are people who would love to have homes, and the govt could them create a mortgage program for govt workers, for example, where the mortgage gets paid right form their salaries, or for the people who lost their homes.

I don't like this bailout concept, but I think it can be done in a totally different way. oh and the CEOS get to leave immediately with NO severance as one of the first conditions.!

[tammywammy]

6. Okay

First the dealer BUYS the cars from the manufacturer. The manufacturer has to lower the price of the vehicle or offer incentives for a dealership to lower their prices on vehicles that much.

[robinlynne]

8. yes. so why not do it immediately? the LA port is full of cars. they are paying tremendous storage

fees because no one wants the cars. they are sitting here. paying rent for the space they re on. The dealers cant sell them. and don't want to take possession. so they sit there. and the companies ar going bankrupt. sell them cheaper.........

The head of the UAW was on the News Hour tonight saying that the Union already took cuts from 2005 up o this year inclusive. Noone else along the car production took any cuts. not the parts suppliers, not the dealers. They all refuse to. Fuck them. The UAw says wages, etc.l are only 10% of the price of a car. Besides parts which need to be paid off,, rent for the factories, or whatever, the rest is...profit. cut that down. sell the cars. without profit. pay the bills. instead of a taxpayer handout.
Why the hell are they paying rent to store cars?

[tammywammy]

16. I believe the ports are full of foreign cars. n/t

[robinlynne]

21. all the dealerships are closing. especially the american dealerships.

Are you saying that American cars are driven and not shipped? That is quite possible. Wherever they are, there are a hell of a lot of unsold American cars....I think here on the west coast they are in the port of Los Angeles, because it is packed with cars. It is becoming a problem. Noone will take them out of the port. It's constantly on te news, but I didn't pay attention to the brands.

[Trajan]

7. What this debate is NOT about ....

This debate is not about 'green cars', because most people cannot buy 'green cars' anymore than they could buy jeeps, bugs, or trucks ..... This is a MONEY problem .... Credit has failed throughout the system because workers HAVE NO MONEY TO SPEND ....

This debate is not how US automakers failed to 'keep up' with foreign automakers - ALL sales are DOWN for each and every sector ... Why ? ... Because people cannot afford to buy cars, and credit is unavailable due to the fall of the credit markets, because workers HAVE NO MONEY TO SPEND ...

People cannot buy domestic OR foreign cars .... They cannot buy gas guzzlers OR gas misers ... Electrics, hybrids or diesels ....

The laws of supply and demand, while many times circumvented by fraud, will eventually grip the marketplace, and force a decrease in price to reduce inventories .... That is already happening ... One can see the level of incentives that have been offered have been increasing weekly ... Expect that to continue ...

There is a name for this - Deflation .... An economic defect that is more detested than inflation by many economists ....

You are right .... a fire sale would provide needed cash to maintain operations ... But what then ? ...

There is more than one problem here :

1) The companies need cash to stay afloat .. and
2) Buyers need to emerge with enough money to purchase their products ...

The bailout helps case 1 .... Case 2 is still a huge problem, and is the real cause of the financial meltdown ....

Potential buyers have disappeared from the marketplace because few can get decent credit, and they are otherwise without the income necessary to buy without credit ...

I blame 30 years of conservative, union-hating, low pay advocates who believe that the only citizen worthy of making a buck is a business owner, and who think that short term profits are more important than worker income ...

We need : 1) A bailout for companies on the brink, and 2) Wage increases for workers so they can pay their bills and buy again ...

This isnt just about cars .... It is about the whole system crashing down because people can no longer afford to make discretionary purchases that keep businesses in business ... The car industry is but one sector that is crashing ...

[robinlynne]

9. The bailout is only designed to provide 3 months more of life to the industry.

why not sell off the cars and do that.
as to the rpoblem of the buyers needed money to buy the cars. That's my point. Sell a new car for $10,000. and I guarantee you they will sell. I'm just guessing a number here.
Imagine you ahve enver had a new car, but all of a sudden you can get one for 2/3 of the regular price. People will buy them.
the abilout solves nothing long term either. this is all about staying afloat until March! That's all.

[Trajan]

12. Oh .. I understand what you are saying .. and yes: Prices ARE dropping ....

Not because they are smart operators, but because their inventories are soaring ...

And yes, they WOULD get their hands on some cash, but what makes you so sure they can sell their cars at 2/3's price ? .... People STILL cannot get credit, and that is a more pressing issue ...

It is the CREDIT CRUNCH that is hurting the car markets .... and it is the INCOME CRUNCH that has damaged the credit markets ... Expenses have soared while incomes remained flat, for many years running ...

That could not last forever .. and it didnt ....

[robinlynne]

13. That is true. I for example would not buy a new car. But I'm sure a lot of people would.

Just as, noone is buying the foreclosed houses here, so the Chinese are coming in and snapping them up by the dozen because the price is good, to them.

[robinlynne]

17. But the prices are dropping inside their old formula. Why not eliminate the profit, and sell for the

cost of making the cars? that keeps the industry running. and helps the economy to move too. and all hose used cars will come onto the market, and some of us can buy them for lower prices.
maybe keep 50% of the dealer's normal profit.
sell for cash maybe to make up the difference.

[dipsydoodle]

28. Why must you always insist on using

common sense.:fistbump:

[EFerrari]

10. People would still need loans, though. Are there any loans? n/t

[Davis_X_Machina]

14. If your FICO exceeds 700, basically...

...it's same as ever. Under that -- vy. difficult.

[EFerrari]

18. Thanks. I haven't financed a car in thirty years so I've no clue if people

are able to get it done.

[razors edge]

19. It moves the economy for

a cycle with a loss, I'm not sure their corporate bylaws allow that.

But more to the point, what do they do next? Another cycle at a loss, then another?

The people who buy now for a 30% cut won't be buying again for a while, those who don't will wait for the next 30% or better sale.

Doesn't sound like a very long term solution to me.

[crimsonblue]

20. This leads to deflation, which is VERY bad

A deflationary downward spiral feeds on itself. If we get in the grip of deflation, we are fucked. No joke.

[coalition_unwilling]

22. What do you mean by "we"? It seems

to me that people who have practiced thrift during these go-go years will see the purchasing power of their savings increase in a deflationary spiral.

Am I really supposed to feel sorry for a bunch of materialist yuppies who lived beyond their means, as if the concept of limits, of restraint, had no meaning?

I call this period Revenge of the English Majors (think "Walden") and History Majors on the MBA class. And it couldn't happen to a more deserving group of self-satisfied, smug bastards.

We the thrifty say, "Think globally, buy locally." And, for God's sake, learn to live with what is, as Thoreau might say, "truly necessary." The planet deserves no less.

Rant over.

[crimsonblue]

23. fuck you.

do you seriously want another global depression just so you can gloat? how selfish of you.

[coalition_unwilling]

26. Mods, is this type of response going to

be allowed without sanction?

For the record, I want a world-wide Democratic Socialist revolution, where economic output is guided by peoples' needs and not by the sacred cow of the "profit motive."

If it takes a worldwide depression to get there, I would argue that the outcome is worth it. And if the parasite class and its enablers like crimsonblue and the MBA class are ground into the dust in the process, well, so much the better.

Now that's an "FU" worth posting.

[tabbycat31]

24. open the credit market instead

that way people who want to buy the cars can get loans to do so.

[defendandprotect]

25. No loans being granted to buyers ....

Which is why US should buy plants and use workers to make ELECTRIC CARS ..

And government should subsidize both mfg and purchase until things straighten out --

BUT "unregulated" capitalism is merely organized crime -

AND, speculative markets for oil or Wall Street and bail-outs are not an "economy" --!!!

[NNN0LHI]

27. As far as I am concerned those cars on the docks can rust away

Those pics of cars at the docks are not American made cars.

Don

[Orangeone]

29. contrast that to Japanese Companies

They don't pay their CEO or management that much, also if a company fails and has to lay off the workers it's a shameful thing, the CEO loses face...

Note: oops posted to wrong thread

[CreekDog]

30. so you're saying you will buy the car today if...?

:evilgrin:

[treestar]

31. The market has to support a price, and even the worker's wages

This is a reality we can't get away from. It is why we need more socialism rather than the government semi-managing the market. Out and out socialism, the government running the economy would be better.

I see all these threads about the auto workers, well, anyone who is going to lose their job (and one wonders that the other jobs aren't just as important as those of auto workers) - it is because the consumers are not buying what their company makes. That's not cruelty on the part of the company, it's just that the company can't force consumers to buy their products or at any particular price.

If we want to have capitalism, we have to deal with the fact that some people will end up out of work at some point and have a social safety net for them instead of bailing out failing businesses. Businesses failing is part of capitalism. Businesses growing is also part of it. But we can't legislate it. Or if we tried, we'd be micromanaged. Required to buy things. It didnt' work for the Soviet Union. Which is not to prove it can't for us, but the country is just not that leftist now.