ClydeR
08-24-2008, 02:34 PM
Everybody's favorite CEO, Lee Iacocca (http://en.wikipedia.org/wiki/Lee_Iacocca), is back in the news, or soon will be. He was big big news 30 years ago when he brazenly asked Congress to guarantee loans to Chrysler, which was in danger of bankruptcy. Below is a description from Wikipedia.
Government loan guarantees
The Chrysler Corporation on September 7, 1979 petitioned the United States government for US$1.5 billion in loan guarantees to avoid bankruptcy. At the same time former Ford executive Lee Iacocca was brought in as CEO. He proved to be a capable public spokesman, appearing in advertisements to advise customers that "If you find a better car, buy it." He would also provide a rallying point for Japan-bashing and instilling pride in American products. His book Talking Straight was a response to Akio Morita's Made in Japan.
The United States Congress reluctantly passed the "Chrysler Corporation Loan Guarantee Act of 1979" (Public Law 96-185) on December 20, 1979 (signed into law by President Jimmy Carter on January 7, 1980), prodded by Chrysler workers and dealers in every congressional district who feared the loss of their livelihoods. The military then bought thousands of Dodge pickup trucks which entered military service as the Commercial Utility Cargo Vehicle M-880 Series. With such help and a few innovative cars (such as the K-car platform), especially the invention of the minivan concept, Chrysler avoided bankruptcy and slowly recovered.
In February 1982 Chrysler announced the sale of Chrysler Defense, its profitable defense subsidiary to General Dynamics for US$348.5 million. The sale was completed in March 1982 for the revised figure of US$336.1 million.[7]
By the early 1980s, the loans were being repaid at a brisk pace and new models based on the K-car platform were selling well. A joint venture with Mitsubishi called Diamond Star Motors strengthened the company's hand in the small car market. Chrysler acquired AMC in 1987, primarily for its Jeep brand, although the failing Eagle Premier would be the basis for the Chrysler LH platform sedans. This bolstered the firm, although Chrysler was still the weakest of the Big Three.
Another significant aspect of Chrysler's recovery was the revitalization of the company's manufacturing facilities, led by Richard Dauch[citation needed]. The factories were streamlined with more efficient machinery, more robots, better paint equipment, and so on[vague][citation needed]. The resultant improvements in efficiency and vehicle quality played a big role in saving the company[citation needed].
In the early 1990s, Chrysler made its first steps back into Europe, setting up car production in Austria, and beginning right hand drive manufacture of certain Jeep models in a 1993 return to the UK market. The continuing popularity of Jeep, bold new models for the domestic market such as the Dodge Ram pickup, Dodge Viper (badged as "Chrysler Viper" in Europe) sports car, and Plymouth Prowler hot rod, and new "cab forward" front-wheel drive LH sedans put the company in a strong position as the decade waned.
More... (http://en.wikipedia.org/wiki/Chrysler)
Detroit's auto makers are asking Congress to do something similar again. Obama supports the loan guarantees. Until a few days ago, McCain opposed the loan guarantees. Obama started making it a campaign issue in Michigan and Ohio, which are expected to be close states in November. McCain, who is a big phony with no principles, reversed himself (http://www.latimes.com/business/la-fi-autoblog23-2008aug23,0,7610189.story) last week and now supports the loan guarantees.
Both Obama and McCain are wrong. In a free market the government should stay out of business. Look how the Chrysler bailout turned out. The government helped turn that company around, and then the Germans bought it.
Government loan guarantees
The Chrysler Corporation on September 7, 1979 petitioned the United States government for US$1.5 billion in loan guarantees to avoid bankruptcy. At the same time former Ford executive Lee Iacocca was brought in as CEO. He proved to be a capable public spokesman, appearing in advertisements to advise customers that "If you find a better car, buy it." He would also provide a rallying point for Japan-bashing and instilling pride in American products. His book Talking Straight was a response to Akio Morita's Made in Japan.
The United States Congress reluctantly passed the "Chrysler Corporation Loan Guarantee Act of 1979" (Public Law 96-185) on December 20, 1979 (signed into law by President Jimmy Carter on January 7, 1980), prodded by Chrysler workers and dealers in every congressional district who feared the loss of their livelihoods. The military then bought thousands of Dodge pickup trucks which entered military service as the Commercial Utility Cargo Vehicle M-880 Series. With such help and a few innovative cars (such as the K-car platform), especially the invention of the minivan concept, Chrysler avoided bankruptcy and slowly recovered.
In February 1982 Chrysler announced the sale of Chrysler Defense, its profitable defense subsidiary to General Dynamics for US$348.5 million. The sale was completed in March 1982 for the revised figure of US$336.1 million.[7]
By the early 1980s, the loans were being repaid at a brisk pace and new models based on the K-car platform were selling well. A joint venture with Mitsubishi called Diamond Star Motors strengthened the company's hand in the small car market. Chrysler acquired AMC in 1987, primarily for its Jeep brand, although the failing Eagle Premier would be the basis for the Chrysler LH platform sedans. This bolstered the firm, although Chrysler was still the weakest of the Big Three.
Another significant aspect of Chrysler's recovery was the revitalization of the company's manufacturing facilities, led by Richard Dauch[citation needed]. The factories were streamlined with more efficient machinery, more robots, better paint equipment, and so on[vague][citation needed]. The resultant improvements in efficiency and vehicle quality played a big role in saving the company[citation needed].
In the early 1990s, Chrysler made its first steps back into Europe, setting up car production in Austria, and beginning right hand drive manufacture of certain Jeep models in a 1993 return to the UK market. The continuing popularity of Jeep, bold new models for the domestic market such as the Dodge Ram pickup, Dodge Viper (badged as "Chrysler Viper" in Europe) sports car, and Plymouth Prowler hot rod, and new "cab forward" front-wheel drive LH sedans put the company in a strong position as the decade waned.
More... (http://en.wikipedia.org/wiki/Chrysler)
Detroit's auto makers are asking Congress to do something similar again. Obama supports the loan guarantees. Until a few days ago, McCain opposed the loan guarantees. Obama started making it a campaign issue in Michigan and Ohio, which are expected to be close states in November. McCain, who is a big phony with no principles, reversed himself (http://www.latimes.com/business/la-fi-autoblog23-2008aug23,0,7610189.story) last week and now supports the loan guarantees.
Both Obama and McCain are wrong. In a free market the government should stay out of business. Look how the Chrysler bailout turned out. The government helped turn that company around, and then the Germans bought it.