As discussions rumble on about what to do about the Detroit automakers, some people are already taking a Treasury bailout as a given. A great example of this is a piece of PR puff by William Ford. Whilst his CEO was (rightly) getting grilled by Washington, Mr. Ford seems to have already moved across the fjord of illiquidity to a new era of energy-efficient vehicles.
Please, spare me the platitudes! From a financial perspective, Ford is only behind GM and Chrysler by a few quarters, and does not have the luxury of fantasy. Even if government support is forthcoming, turning around Ford will involve a "scorched earth" restructuring.
Nostalgia is great, but it is time for the Fords to be separated from the business great-grandfather created, and that they have now wrecked by years of lazy, inept and paternalistic management.
To show the mountain that Detroit has to climb, just think of the quality gap between them and their foreign rivals. Given the choice, would you prefer driving a clunky Ford truck or a German-built SUV? No contest, of course. This simple truth may be unpalatable, but until US manufacturers face up to it they are on a road nowhere.
If the government wasn't breaking the rules with bailout promises, the Detroit carmakers would be left to adapt or fold. Individuals have to do this all the time in the job market, and there's no reason to grant the autoworkers any exemptions from that rule.
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