Little Hope For Auto Makers GM and Ford
Both GM (GM) and Ford (F) released earnings today and the results were staggering. Everyone thought that $1 billion per month was GM’s burn rate. Guess again. Cash problems were finally admitted, and it’s about time.
From Yahoo Tech Ticker:
More dire news from U.S. automakers: GM posted a worse-than-expected $2.5 billion Q3 loss and indicated that it’s “estimated liquidity will fall significantly short” of 2009 operating costs. Meanwhile, Ford announced that it lost “only” $129 million in Q4 but had also burned through $7.7 billion in cash. Little wonder that the CEOs of the Big Three carmakers went to Washington yesterday with hats in hand.
Personally I think the government should step in and help retirees with pensions and then let the GM and Ford go under (the airlines have done it many times). From there both companies can restructure like any other big business while STILL making cars.
Just because you go bankrupt does not mean the production and business stops abruptly. A complete government bailout only delays the inevitable and costs tax payers more money. The economy is going no where and the unions have a stranglehold on everything in between.
Source:
Car Trouble: Big Three Go Begging, But is Gov’t Bailout Answer?
Aaron Task
Yahoo Tech Ticker
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