Auto's Big Three Fuel Up For Bailout
On Capitol Hill today, it was all about being green, efficient and technologically savvy.
Executives from Detroit's big three automotive manufacturers, Gerald Wagoner Jr., president and CEO of General Motors Corp., Alan Mulally, president and CEO of the Ford Motor Co. and Robert Nardelli, chairman and CEO of Chrysler, LLC, are speaking to lawmakers from the Senate Banking Committee, asking for up to $34 billion in emergency bailout money to save the nation's struggling car and truck industry.
It has been two weeks since the executives appeared before Congress, only to be sharply criticized for arriving for the hearings in private jets. Today, all three men said they came to Washington by car.
And all three pledged to use any federal money wisely, to benefit the consumer.
Still, many lawmakers said they remain skeptical of any government-funded bailout.
Sen. Richard C. Shelby (R-Ala.), the top Republican on the Banking Committee, said he would oppose any bailout for the auto manufacturers, saying the companies were lagging behind overseas rivals.
"The firms continue to trail their major competitors in almost every category necessary to compete," he said.
And Sen. Charles Schumer (D-N.Y.) simply said: "I don't trust the car companies' leadership."
Mullaly said Ford now has a "laser focus" on the company's most important brand, the Ford blue oval.
"It used to be that our approach to our customers was, if you build it, they will come," Mullaly said. "We produced more vehicles than our customers wanted and then slashed prices, hurting the residual values of those vehicles and hurting our customers. Now we are aggressively matching production to meet the true customer demand."
Mulally added that the company was also now focusing on smaller cars with higher fuel economy, reducing labor costs and streamlining its global production.
Nardelli said Chrysler would negotiate "cost-saving concessions from all constituents" and invest in fuel-efficient cars and trucks in exchange for a $7 billion loan, adding that his company's future is "robust, it's realistic and it's green."
"With such a huge hit to our sales and revenue base, Chrysler requires a loan to continue the restructuring and fund our product renaissance," he said. "Chrysler has a sound plan for financial viability that includes the seeking of shared sacrifice from all constituents."
Wagoner urged congressional leaders to push through a bailout, citing cost-cutting moves at General Motors, including reducing the board's compensation to $1 a year and ceasing all corporate aircraft operations. He also pledged that the company would pay back any loan in full by 2012.
By Derek Kravitz |
December 4, 2008; 2:53 PM ET
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