The Big Three automakers went to Washington (again) yesterday. This time, they did more than simply ask for a handout (okay, they did do that). They also made a few promises. Among the highlights:
• GM wants to focus on four core brands: Chevrolet, Cadillac, GMC and Buick (we told you as much yesterday). Hasta la vista Saab, Hummer, Saturn. Word is that Pontiac will live on, though only as a niche (probably performance) brand.
• GM also said it will reduce its dealer network from today’s 6,450 to around 4,700 by 2012. (Though today’s economic climate will likely perform that job for the General by forcing a lot of those dealers out of business.)
• Ford said its dealer base will be about 3,790 by the end of this year, a figure that represents 14 percent fewer Ford dealers than existed at the end of 2005.
• The CEOs of the companies said they will each work for $1 a year if Congress agrees to the bailout. (I’m sure there’ll be some stock options added to that, as well.)
Oh yeah, GM, Ford and Chrysler did ask for money, too. GM needs $4 billion by the end of the month, $12 billion by the end of March and a total of $18 billion during the next year to stave off bankruptcy. Chrysler needs $7 billion by the of the month. Ford, which is in the best financial shape of the three, only wanted $13 billion in credit set aside in case the economy goes even further into recession.
So will the UAW stick to its guns and resist losing tens of thousands of union jobs, a move that would almost certainly push GM and Chrysler (and maybe Ford) into bankruptcy? What will Congress do? Bow to the automakers and hand out more of our (borrowed) cash? Stick to their guns and see how the automakers fare? Like I noted yesterday, interesting times!