U.S. companies that make and supply auto-parts to major carmakers are pleading for a bailout from Washington, as many are now on the verge of declaring bankruptcy. Auto-parts companies may seek between $10 billion and $12 billion in cash and guarantees from the federal government as soon as this week.
Investors beware of the electric car, because, as a New York Times article reveals, even the Big 3 in Detroit are wary. Alternative energy in all forms could be the biggest potential bubble for investors. But green automobiles can be particularly hazardous to your portfolio because of the visceral reaction to volatile gas prices.
Chrysler LLC stunned its employees and dealers early yesterday (Thursday), announcing it was suspending all manufacturing for at least a month, and tightening wholesale credit terms to dealers. By the end of the day, Chrysler was joined by its two other Big Three brethren – General Motors Corp. (GM) and Ford Motor Co. (F). – which also shuttered factories.
Toyota Motor Corp. (ADR:TM) may not need a government bailout, but it’s hurting badly. The world’s top automaker said it will announce a revised 2009 sales forecast at its end-of-the-year news conference Dec. 22. The company is expected to slash at least 1 million cars from its original forecast of 9.7 million units, Reuters reported.
The U.S. House of Representatives approved a $14 billion federal loan package for Detroit’s embattled “Big Three” late yesterday (Wednesday), overcoming Republican opposition in the House but leaving the bill to face an uncertain fate in a hostile Senate.
Congressional Democrats and the White House yesterday (Wednesday) finalized a short-term package that’ll supply General Motors Corp (GM), and Chrysler LLC with $14 billion in emergency loans.
Another currency rally…. SNB cuts another 50 BPS! Budget Deficit continues to widen! Treasury yields go south for the winter! And Now… Today’s Pfennig!
Another currency rally…. Bank of Canada cuts 75 BPS!… A Santa rally?… What Asia thinks… And Now… Today’s Pfennig!
The fact that after over 30 years of consistent mismanagement and decline, there is still any discussion on whether or not we should allow the now significantly smaller “Big Three” automakers to fail is clear evidence that Washington has lost all common sense.
With the U.S. “Big Three” of General Motors Corp. (GM), Ford Motor Co. (F), and Chrysler Corp. seeking as much as $34 billion in bailout money, there’s a lot at stake for the American auto industry. There would also be quite a bit at stake for Congress, given the personal stakes that elected officials own in the automakers, FoxBusiness.com reports.
