WDET News
- Keith Crain On The U.S. Auto Industry's Future
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Dec 11, 2008Automotive & Business
Keith CrainThe Publisher and Editor-in-Chief of Automotive News gave his predictions for the U-S auto industry’s future today (Thurs.). WDET’s Sarah Cwiek has more…
SOQ
Keith Crain says U-S automakers have rapidly lost market share since the 1970s. But it’s the recent economic collapse and credit crisis that have pushed them to the edge of bankruptcy. Crain says he doesn’t think Chapter 11 bankruptcy is an option for carmakers…as it will cause revenues to decline so quickly the companies would be forced to liquidate. But he says a government “car czar” and highly conditional Federal loans…could offer the companies many of the same benefits as Chapter 11:
“Ron Gettelfinger will give back even more on behalf of the UAW. Bondholders could forgive large amounts of debt…if their alternative is default. Maybe even car dealers would get serious about merging or selling out to get those bloated big three dealer networks down to the right size. Then the weak brands could be killed…without breaking the backs of the automakers.”
Crain says he believes Chrysler and G-M can survive until the end of next month even without government aid. He says Chrysler will almost certainly disappear regardless…but that G-M and Ford can survive and even thrive…albeit as much smaller companies. This is Sarah Cwiek…WDET news.