There is a price to pay to have the government bail you out and it’s not just that you have to pay the money back with interest. When this bailout of GM and Chrysler is all said and done the United Auto Workers will own 39% of General Motors and 55% of Chrysler.
When it comes time to discus union contracts it looks like the UAW will have to negotiate with itself.
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[…] Original post by jimsgarage […]
I think this is the end of the line for both companies. It will just take a while to play out. The government also has a major stake in the deal, especially at GM. The Feds have no business owning an automaker and I doubt the UAW has the capability to do so. Together, the imbalance of interests involved is astonishing –and make success much harder to come by. It gives a whole new meaning to “corporate politics.”
The market has already spoken, with GM’s overall share down to what, something like 20% of all vehicles sold in the U.S.? I don’t think they will totally go away, but they will become bit players. It occurs to me that the best selling GM product is the Silverado truck. Maybe all GM should sell is trucks, and some niche vehicles like the Corvette.
Funny you should mention, there’s an article on this very topic. Link
Jim,
The negotiations would be interesting I can imagine…
“The good news boys is that we are all getting 200% raises…the bad news, you’re all unemployed next week because we are moving the plants to bora bora. (Or whatever present low cost jurisdiction is in vogue).
Sad to see really it is, and so representative of so much going on today.
I wonder if the auto industry will “reboot” in a way. Think about how cars really started, all these different designs, hand built, or nearly so. I wonder if we will see a new era of relatively small players building some future generation of vehicles? Or will there just be a couple dominant players like the oil industry and you can have any color so long as it’s black. The true commodity that was the model T redux ?
Mark
JIM'S GARAGE 
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