I have come to the conclusion that GM is the auto version of AIG. Now we have two sucking black holes. Would you believe while GM is begging congress for billions of dollars, they sent US taxpayer money to Brazil? And while US autoworkers are being laid off, in Brazil, GM employees, 7,000 of them, are on PAID HOLIDAY?
Yesterday the CEO’s of the Big 3 flew to Washington, DC to
beg, plead, rob, to tell Congress the auto industry is running out of cash and needs $25 billion in taxpayer money to avoid bankruptcy. The CEOs told Congress that they will likely go out of business without a bailout.
Rick Wagoner of GM told members of Congress that the company is burning through ash, asking for $10-$12 billion for GM. “We want to continue the vital role we’ve played for Americans for the past 100 years, but we can’t do it alone,” Wagoner told the Senate Banking Committee. One person close to GM in Detroit said that the company needed around $11 billion within three months just to stay afloat.
All three used private jets to make the trip, but lets focus on GM, shall we? Wagoner used his G4 private jet, one of eight jets in the GM fleet that continues to ferry executives around the world. Wagoner’s private jet trip to Washington cost his company an estimated $20,000 roundtrip. After the hearing, Wagoner declined to answer questions about his travel. GM (along with Ford) say that it is a corporate decision to have their CEOs fly on private jets and that is non-negotiable, even as the companies say they are running out of cash.
But part of the money that GM wants is for health-care coverage by UAW retirees, especially for those who are too young for Medicare. GM, along with Ford and Chrysler, want to make sure the retirees have the luxury of health insurance, and their pension, at the US taxpayers cost. One GM retiree states that he receives $3,000 a month in pension and health-care insurance for life. When he retired from GM, he was making $33 an hour as a welder/repairman and he received a pension and a $35,000 buyout after working for GM for 34 years.
[I guess you an I are the ones who GM expects to pay the bill for their contract with the UAW, although you and I aren’t the ones who agreed to it. We are not the ones who promised to pay wages to a “bank” or workers we no longer need.]
Also, GM just opened a $300 million plant in Russia earlier this month and is expected to produce 70,000 cars annually.
But meanwhile, GM is kissing some serious butt in Brazil. It is being reported, as of today, that GM has decided to invest $1 billion (USD) to expand business in Brazil, the local media reported Tuesday. The money is coming from the $25 billion US taxpayers to “complete the renovation of the line of products up to 2012” which is part of the retooling to bring vehicles up to meet the more stringent air quality standards and part of the CAFE (corporate average fuel economy” standards.
But yet, GM”s chief executive in Brazil, Jaime Ardila has said that “We are not dependent on the U.S. in any way.” And also according to Ardila, “It’s not part of corporate’s plans to file for bankruptcy, so we’re not going to speculate,” when asked if GM files for bankruptcy. “GM [Brazil] is independent from an operational standpoint. It develops its products locally, for a local market, and all of its suppliers are here. Nothing is imported,” Andre Beer, former vice president of GM in Brazil, now a consultant in Sao Paulo, said. GM Brasil is a separate legal entity from its parent in Detroit, they do not make anything for the United States market, yet they still received $1 billion in taxpayers money from GM US.
And in Brazil, automakers AREN’T getting bailed out, or even asking for government aid. But the Brazilian government did give them $8 billion Brazilian reals ($3.47 billion USD) into the auto loan market through government banks.
Also at GM Brazil, 7,000 Brazilian workers are on mandatory paid leave. “This probably won’t be the last paid leave announced by the company,” the director of Sao Jose do Campos’ metalworkers union, Vivaldo Moreira Araujo, said in a statement. [So unlike here in the US the workers are not “laid off” but on PAID leave? Am I missing something here? Are you ready for the “twist”?]
With the CAFE (corporate average fuel economy) standards imposed by Congress, vehicles that are fuel-efficient that are imported from their overseas factories count as fuel-efficient. In other words, the CAFE states there must be a certain percentage of vehicles that meet CAFE standards produced.
To me, it sounds like GM is planning on using their Brazilian company to meet the CAFE standards for . Yet in 2005 alone, American bought more cars than did China, India, Russia and Brazil, COMBINED.
So, GM gets money from the US taxpayers, from a “handout” to retool vehicles to meet more stringent US air quality standards, sends part of that money to Brazil and uses part of that money to help retain jobs in Brazil, but begs Congress for money? Have I missed anything? So let me make sure I have this right. GM uses US taxpayers money, free money, that is suppose to be used for retooling for US vehicles to meet the more stringent air quality controls that take effect in 2012, but sends part of that money to GM Brazil, a company that is independent from GM Detroit, for retooling on South American vehicles………. And remember Nancy Pelosi wants a lame-duck session of Congress to give the Big 3 taxpayers money yet Treasury Secretary Paulson has said “NO” to using part of the $700 billion bailout for the Big 3. The Big 3 has already gotten $25 billion for retooling and now wants another $25 billion for “daily operational costs” which include giving money to those who are retired, and obviously sending it overseas to other countries.
GM needs to fall………… and learn to stand on their own two feet without help and learn to walk a new way instead of wanting something for nothing.
Brazil is the largest GM subsidiary in South America and the third largest in the world according to their website. In Sao Caetano do Sul, Brazil are the administration, technological center, engineering center and manufacturing facilities. Vehicle assembly, plus engine and transmission manufacturing facilities are in Sao Jose dos Campos. The Mogi das Cruzes Comples has manufacturing and parts distribution facilities. In the state of Rio Grande do Sul, GM has a vehicle assembly facility in the city of Gravatai. A parts distribution and warehouse are located in Sorocaba and a proving ground is in Indaiatuba, both in the state of Sao Paulo. GMAC has headquarters in Sao Paulo and handles finance activities, including credit and leasing.
The company’s Brazilian headquarters in Sao Caetano do Sul employs 11,333 engineers and administrative staff out of a national total of 23,874.