General Motors Corp. might not wait 60 days to declare bankruptcy. The automaker’s new CEO, Fritz Henderson said GM could head to bankruptcy court for a quick reorganization before June 1 if it can’t make deep cuts fast enough to meet the Obama administration’s mandate for a revised revitalization plan in 60 days.
Under GM’s earlier restructuring plans, filed late last year, the company would keep four of its eight vehicle brands: Chevrolet, Cadillac, Buick and GMC, although Pontiac would remain as a niche nameplate with a much smaller lineup. Mr. Henderson said GM is executing that plan and he said it was inappropriate to discuss whether some of those four core brands might not survive should GM enter bankruptcy court.
So here is what I just don’t understand about the failing auto sector. Why in any regard would the US government consider giving money to the manufacturers on their promise that they can survive and wait for the consumer to choose to buy their vehicles? Am I missing something, or was it not the lack of purchasing that got them into this mess in the first place. Sure, Honda and Toyota are struggling, but that is a result of the market. They are not talking bankruptcy because consumers still want to buy their vehicles, just in lesser volume.
Here is an interesting thought. Lets give every consumer in America that decides to buy a domestic automobile a voucher for $15,000. If they buy a cheap car, that could almost cover the entire cost. That way, only the companies that make the vehicles that the consumer actually wants will survive, and at the same time, the funds will be flowing in to allow them to continue operations. Isn’t that the goal of this whole bail-out plan anyways? Let the brands and companies that no-one wants go away. Giving them money to survive a short while when in the end, no one will choose their vehicles anyways…
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