Archive for the ‘Toyota’ Category

Toyoto Passes GM in Sales; GM Fears Cash Collapse

January 21, 2009

Poor GM.  It may run out of money before March 31st, and for the first time ever, Toyota sold more cars than the stuggling U.S. automaker.

General Motors sold fewer cars globally than Toyota last year, as the Japanese automaker passed the Detroit company for the first time. GM says it sold 8.356 million cars and trucks in 2008, falling about 616,000 vehicles short of Toyota’s total of 8.972 million.  General Motors Corp. posted an 11 percent drop for the year, while Toyota’s sales fell 4 percent.

Associated Press

And now GM needs some money – quick!

The target date for General Motors Corp. to get its second installment of government loans passed last week, but a top company executive says he expects the money to arrive in the next several days.

Fritz Henderson, GM’s president and chief operating officer, said without the second installment of $5.4 billion, the company would run out of cash long before March 31.

In December, the Treasury Department authorized $13.4 billion in loans for GM and another $4 billion for Chrysler LLC to keep both automakers out of bankruptcy.

Read the rest:
http://www.nydailynews.com/money/2009/01/2
1/2009-01-21_general_motors_may_run_out_o
f_cash_by_ma.html

Auto Bailout: Not Monday: White House Mulls Option

December 15, 2008

The White House tossed out no lifeline for the teetering auto industry Sunday, although  President Bush reiterated that he was considering using money from the $700 billion financial bailout fund to provide loans to the carmakers.

“An abrupt bankruptcy for autos could be devastating for the economy,” Mr. Bush told reporters Monday aboard Air Force One during an unannounced trip to Iraq and Afghanistan. “We’re now in the process of working with the stakeholders on a way forward. We’re not quite ready to announce that yet.”

In a photo provided by the Ford Motor Co., the final Ford Expedition ...
In a photo provided by the Ford Motor Co., the final Ford Expedition is driven off the assembly line as production ends at Michigan Truck Plant in Wayne, Mich., Wednesday, Nov. 26, 2008. The move signals the beginning of the transformation of the auto plant to be retooled as a car plant to begin producing small, fuel-efficient vehicles in 2010. (AP Photo/Ford Motor Co., Sam VarnHagen)

Mr. Bush wouldn’t give a precise timetable but said, “This will not be a long process because of the economic fragility of the autos.”

White House officials said they did not expect to make an announcement Monday. The administration is considering ways to provide emergency aid to General Motors Corp. and Chrysler LLC, which have said they could run out of cash within weeks without federal aid.

Sen. Bob Corker, Tennessee Republican, who blocked legislation that would have provided $14 billion in loans to the automakers, said he had spoken with the White House early Sunday. “I don’t think they yet know what they’re going to do,” he said. Ron Gettelfinger, the president of the United Auto Workers, said the union had not held discussions with the White House.

CBS VIA ASSOCIATED PRESS Sen. Bob Corker spoke with White House officials and said, "I don't think they yet know what they're going to do."

Sen. Bob Corker

Associated Press

Read the rest:
http://www.washingtontimes.com/news/2008/dec/
15/bush-takes-no-action-to-salvage-auto-industry/

Auto Bailout: White House Has President’s Hand in the Door

December 14, 2008

As if President George W. Bush had his hand stuck after slamming it in a car door, the assembly line is moving and the White House, Treasury and Fed are trying to figure out what to do.

Bush supported and endorsed the Congressional plan, brought down by Senators of his own party last week.

Advocates now want the money to bailout the auto makers to come  from the Troubled Asset  Relief   Program (TARP).  But half the TARP money is gone and only about $15 Billion is available for carmakers.  Add to that the fact that Congress approved the TARP for purposes other than a “bailout” for auto makers.

The White House could get the money from the Federal Reserve.  But this is problematic too:  before the Congressional bailout failed, Fed Charman Ben Bernanke alread said the automakers had insufficient collateral (or ample “unencumbered assets”)  to secure a $15 Billion loan from the Fed.

In a letter to Senate Banking Committee Chairman Christopher Dodd, D-Conn., Bernanke wrote that any decision about whether to provide financial aid to Detroit is best left to Congress.

A key consideration in letting an auto company draw emergency cash loans from the Fed is whether the company has sufficient collateral or other security to ensure repayment of the loan. “It is unclear whether the auto manufacturers have unencumbered assets of sufficient amount and quality to meet this requirement,” Bernanke wrote.

US Federal Reserve Bank Chairman Ben Bernanke pauses during ... 
Federal Reserve Chairman Ben Bernanke

So, President Bush is between a rock and a hard place.

Finally, the sticking point with Republican Senators remains unresolved.  They want to know the plans of the automakers and their unions to get the workers’ pay and benefit packages more in line with the pay of their competitors like Toyota.

Bush Administration people are going over the automakers’ books and some announcemnt on a bailout could come ….on Tuesday….

File photo shows assembly line workers on a Toyota Motor's ... 
File photo shows assembly line workers on a Toyota Motor’s production line at the company’s Tsutsumi factory in Aichi prefecture, Japan. Commercial rating agency Fitch Ratings have downgraded the auto giant by two notches, warning that in the current slump even the strongest carmaker no longer deserved its top rating.(AFP/File/Toshifumi Kitamura)