There’s no denying that the American auto industry is in trouble. Ford, General Motors and Chrysler are all saying they could run out of operating cash by as soon as the first half of 2009. If they go down, an estimated 3-6 million Americans would lose their jobs over the next several years. These jobs are made up of the 355,000 people directly employed by the big three and also the companies that rely on domestic auto makers for business; dealerships, OEM manufacturers and financing companies would all go down the drain.
There is no doubt that it would be bad for our economy if Ford, Chrysler and General Motors all go bankrupt. The CEO’s of Detroit are in Washington D.C. today asking for another $25 billion dollar loan that they can use to invest in green technologies and to also pay their monthly bills. Although that seems like a sizable amount of money, it would be split evenly between all three companies. Considering that GM’s monthly operating cost is $13 billion, this loan would only keep GM alive for another three weeks!
I’m all for supporting our American economy, it really is in trouble. But did the CEO’s really have to fly in their private company jets to Washington DC ? Analyst Richard Aboulafia of the Teal Group estimates the roundtrip cost at $20,000 for each jet. A first-class roundtrip ticket bought this morning would have cost less than $1,000.
I think we do need to figure out a way to save the American auto industry, but Rick Wagoner (GM), Alan Mulally (Ford) and Bob Nardelli (Chrysler) are not inspiring any confidence with their not-so-thrifty decisions. Congress seems to agree; “There is a delicious irony in seeing private luxury jets flying into Washington, D.C., and people coming off of them with tin cups in their hand, saying that they’re going to be trimming down and streamlining their businesses,” said the Democratic Representative Gary Ackerman of New York.
Is scary to realize that Detroit’s treo hasn’t yet figured out that saving jobs should come before the preservation of their company perks.