Public opposes auto bailout by 60 percent in CNN poll

Most Americans opposed a bailout for the ailing US auto industry

by Alex Ricciuti
December 4, 2008 7:39 PM
Filed Under: American, Chrysler, Corporate/Financial, Ford, General Motors, Industry

US automakers hoping for government aid stand a better chance winning over lawmakers than the American public.

In a poll conducted earlier this week by CNN, 61 percent of respondents were opposed to a bailout for the ailing US auto industry.

The CEO's of the Big 3 were roundly criticized last month for arriving in Washington to ask for a bailout each in their own corporate jet. Even Democratic lawmakers sympathetic to their cause have chastised Big 3 management and have demanded that the industry do more to prove they will capably restructure their companies and use the bailout money wisely.

On Tuesday, the companies presented their restructuring plans to the Congress and are now asking for a 34 billion dollar package, instead of the previous 25 billion they were pleading for just last month. They claim worsening market conditions has led them to bleed cash much faster.

November sales figures were dismal across the board and hit Japanese automakers just as hard as the domestic brands. Nissan suffered a 42 percent drop in sales compared to November of 2007. For Toyota, it was almost 34 percent. GM and Chrysler fell precipitously at 40 and 47 percent, respectively. Ford faired the best at 30 percent, while US car sales as a whole were down 33 percent for the month.

The American public, along with a majority of Republicans in Congress and the Bush administration, oppose a bailout, but the consequences could be worse than they believe. Alan Mulally, CEO of Ford, has said his company may not need a bailout, but that if GM collapses it may lead to a domino effect in the industry and take out suppliers and ultimately take his company down too.

Source: cnn.com

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Comments

Absolutely agree with the public opinion. I need a bail out on my home too. This so called BIG 3 made mistakes and are not paying for them, why should honest tax payers like me pay for mistake driven by market situation and predatory loans issued by mortgage companies.

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by car-o-bar | December 4, 2008 8:36 PM

I'm also with the majority. They have taken advantage of American public for to long. As the back bone of manufacturing in America they had the moral responsibility to make the best cars they possibly could. Instead they squandered it by pushing inferior products with a shelf life for high volume turnover, i.e. the SUV. Their short sightedness and disrespect for the American consumers has finally caught up to them and they deserve to disappear and let more deserving companies that have shown respect for the consumers replace them.

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by amazingjerry | December 4, 2008 9:17 PM

First of all, let me say: I am not anti American! However: I cannot understand the US Auto industry. I know Americans are in love with their cars (Frankly I'm not much into walking either) but seriously, can't Ford, Chrysler and GM sell you guys something better? I often read comments on WCFs that say Ford's European models look way better than what you guys get. Well guess what, they probably drive better and use less fuel too! Ford, GM and Chrysler are selling you guys rubbish and paying themselves handsomely. Why the sudden Green push? Surely, any self respecting Auto maker would have noticed that Green lean cars are the new Black before they paid themselves all the company dollars and had to go crying to Uncle Sam? Then they want the US Government to bail them out? The fact that the issue is being discussed on worldwide television amazes me. Maybe we should all open up business, forget to manage them, take some dollars from our hard working neighbours and then ask the Government for a hand out. Seriously, what is going on here?

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by william346 | December 4, 2008 9:45 PM

Bankruptcy as the Big 3 needs to be the Small 3! Their are so many more car companies, more competition that the only way to survive is to downsize and make a smaller group of cars and trucks that you can constantly upgrade yearly. Look how fast Kia and Hyundia have made improvements when the customers or crash test reveal a problem.

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by eddie | December 4, 2008 9:55 PM

I completely agree with eddie. While the big 3 are loosing serious amounts of money, KIA is either still making money or loosing a lot less. They have a much more efficient business model and they're consistently improving their build quality. Something that Detroit hasn't been able to pull off seemingly since the Model T.

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by Viking79 | December 4, 2008 10:10 PM

No bailout. This is Business 101. Companies that can compete get eat up by the competition. The fake propaganda that 3 million jobs will be lost is misleading. Other companies will fill in the space and rehire experienced labor. GM cars will still be around even if the company goes under, so a secondary market will emerge, also hiring. The only ones who will suffer is upper management getting the big piece of pie and the pensioners paying full benefits for retired workers. The government can pick up that bill and it'll be MUCH cheaper than 34Billion.

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by wickedated | December 4, 2008 10:30 PM

Yea except when that theory is taught it usually is referring to a company competeing against another fellow country business. Not the complete dismissal of an entire countries industry. Especially not in an industries as huge as the Big 3 and and a country as important as America. This is a little bigger then Bestbuy Vs. Circuit city

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by gmfan09 | December 5, 2008 9:25 AM

If it wasn't all three of them in trouble then this would be such a big deal. The weak link in the industry would go away and the rest would pick up the slack. This is the entire American auto industry Business 101 doesn't always apply. I'm really concerned who is going to fill the void in the American economy if the entire auto industry is gone. It just can't be replaced or done away with.

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by gmfan09 | December 5, 2008 9:30 AM

I’ve seen the results of the CNN poll, and I wanted to point out some of the areas where it conflicts with existing polling. According to the headlines, 60% of respondents oppose federal bridge loans to automakers. However, the CNN poll also shows that the American public is deeply fearful of the ramifications of a domestic-industry failure. According to a poll done by Peter D. Hart, 90% fear the harm a collapse would do to the manufacturing sector, 84% think it would harm the economy, 70% fear that a collapse would decrease our standing in the world, and 6% worry about a lack of competition among existing automakers should the Big 3 fail. 15% of the American public – 18 million households – told pollsters that a collapse would immediately affect their families, with a 77% expecting their family to be affected sometime in the future.

Keep in mind it is very hard to get meaningful poll results for issues that people don’t really understand. The recent study by the Center for Automotive Research (cargroup.org) make it clear that the sudden failure of one or more domestic carmakers would be catastrophic for the U.S. economy. Congress and industry analysts all agree on this. Right now, that is what matters most.

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by TomWilkinsonatGM | December 5, 2008 12:06 AM

Couldn't the CEOs take pay cuts and why do they need personal jets? how much are they worth!

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by mortz | December 5, 2008 3:06 AM

No bailout. They don't deserve the money. For decades, they've been begging for money every crisis or on every sign of trouble (especially Chrysler). It is like the 3rd time they ask for money. Honest taxpayers don't deserve to see their money wasted on gas guzzling SUVs that raise gas prices and fancy jets they don't own. The Big 3 have been wiping their butts with the money. Ford might still come back, they've been working hard recently on their new models, but the other two deserve to disappear from the market. The world will do fine without them.

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by WildMaverick1200 | December 5, 2008 7:31 PM

The world might, but America wouldn't. If all three companies failed it was send a huge shock-wave throughout our economy. Our economy is already in a recession and letting three massive companies such as GM, Chrysler, and Ford fail is just going to make everything worse, especially the number of unemployed. And to those who say that those people would be rehired, how long do you realistically expect this would take? Months? Years? A new automakter, especially one the size of the big three, can't just jump in and set everything up in a few weeks. Not to mention all the retired workers who would lose their pensions, forcing more people to mortgage theirs home, and further damaging the housing market. People need to be less short-sighted and realize that letting them fail would severely hurt us in the long run.

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by puddingpuppet | December 5, 2008 11:08 PM

I would support bailout if it would actually bail them out, but the outlook of them getting out of it even with the loan is simply dismal. The product and the market simply don't exist and will not come for another 18~24months. Just let them be. Whoever figure out how to survive that long are the fittest.

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by mroctober | December 5, 2008 11:59 PM