Mitt Romney: Let Detroit Go Bankrupt
The former governor of Massachusetts and erstwhile Presidential candidate says that Detroit needs a turnaround, not a check.
IF General Motors, Ford and Chrysler get the bailout that their chief executives asked for yesterday, you can kiss the American automotive industry goodbye. It won’t go overnight, but its demise will be virtually guaranteed.
Without that bailout, Detroit will need to drastically restructure itself. With it, the automakers will stay the course — the suicidal course of declining market shares, insurmountable labor and retiree burdens, technology atrophy, product inferiority and never-ending job losses. Detroit needs a turnaround, not a check.
Tough words coming from the son of a former auto industry executive and legendary Michigan politician. Romney notes that in order for American auto makers to be competitive they’ve got to eject labor contracts that are making their cars less competitive with foreign-made cars. And he says that management, which has guided American automakers to insolvency, should go as well.
That extra burden is estimated to be more than $2,000 per car. Think what that means: Ford, for example, needs to cut $2,000 worth of features and quality out of its Taurus to compete with Toyota’s Avalon. Of course the Avalon feels like a better product — it has $2,000 more put into it. Considering this disadvantage, Detroit has done a remarkable job of designing and engineering its cars. But if this cost penalty persists, any bailout will only delay the inevitable.
Second, management as is must go. New faces should be recruited from unrelated industries — from companies widely respected for excellence in marketing, innovation, creativity and labor relations.
Romney is exactly right on both points.
Tags: Politics
I agree, a turnaround is indeed needed regarding the auto industry’s situation.
Wow, this guys sounds presidential.
Better than Daschle Care. Sandpaper gloves, and a time clock for your visit.
Also, like happened in Britain just the other day. A guy with cancer could have had an additional couple of months of life to spend with his family, but the medicine was too expensive. “He will die anyway, so why spend the extra money.”
Wow.
Must be one of those two times a day when the broken clock that is Mitt Romney and I agree on an issue of substance.
Chalk one up for Romney. He could be more conservative or right on this one.
Romney just flip flopping again.
“Mr. Romney proposed increased government spending for research on advanced fuels and vehicles, aid to automakers to deal with the costs of health care and pensions for retirees, and tax cuts for most taxpayers to help them buy new cars.” -Romney during the Primaries
http://www.nytimes.com/2008/01/13/us/politics/13campaign.html?_r=1&ex=1357966800&en=46f87042ed9f2ec6&ei=5090&partner=rssuserland&emc=rss&pagewanted=all
Looks like he’s just pandering to the conservative wing of the party. He’s probably looking for another run in 2012. In which case, he doesnt have my vote. Even if he wins the primary.
Greetings:
Is that picture meant to imply that Mr. Romney enjoys packing some fudge?
Good thing Romney pretty much got right to the point, which I agree with whole heartedly, because with all the hot air filling the rest of his article, it was hard to finish.
For those GM employees concerned about their retirements don’t fret the Pension Benefit Guaranty Corporation (PBGC) protects the retirement incomes of nearly 44 million American workers including those at GM.
The only problem is that the taxpayer is the Pension Benefit Guaranty Corporation. Keep GM and its employees working or pay for their retirements.
http://nomedals.blogspot.com
No, He’s putting a protective glove on his hand.
He’s probably going to EXAMINE one of the fudge packers.
I visit http://negocioblogger.com
It is too highlights
So many in government seem adamant on bailing out 12,000 people who have been paid for decades to not work. It is refreshing to hear Mr. RomneyCare rail against the tide.
*cough*
hence the glove.
Romneycare.