A plan to fix the US auto industry

November 19, 2008 6:45 am

General Motors and Ford have their backs against the wall as they wait for a government handout. But without proper strings and a plan that will help awaken management to the need for a material change, more zombie companies will be on life support funded by taxpayer money.

For decades, it was obvious that Asian auto manufacturers were stealing a significant portion of domestic sales right under the noses of management who apparently did not think it a problem. Maybe it was the long lunches, fat salaries or bloated benefit packages that obscured their outlook and now has them begging.

Even if $25, $50  or $100 billion is approved by Congress, the massive legacy costs for multiple layers of expenses including the high cost for employee benefits, retirement plan obligations and the incremental expense for unions doesn’t help or encourage investor optimism. They need something more than a simple cash infusion. Here’s my ideas to help fix this industry…

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