Following last month’s ill-fated appearances before Congress the Big Three US Auto makers were directed to submit survival plans showing what any bailout money would be used for. Today was both the submission day and the day in which the November sales numbers were announced.
Autoblog has a number of posts following this busy day:
Ford stated it could survive if the recession ended in 2010 with its North American operations being profitable by 2011 and would only need government assistance in the event of a longer recession or the collapse of General Motors or Chrysler impacting its suppliers. To deal with these possible it requested $9 billion in bridge financing. Part of its restructuring plan would be to sale Volvo. It also announced plans for a battery electric vehicle (BEV) in a van-type vehicle for commercial fleet use in 2010 and a BEV sedan in 2011.
Chrysler is in more difficult straits is requesting a $7 billion secured working capital bridge loan by December 31, 2008 as without the loan it expected to run out of working capital in the first quarter of 2009.
As the biggest car manufacturer and with the most brands, General Motors presented a radical plan in its request for $18 billion in loans including $4 billion this month. Autoblog noted that in its plan for profitability General Motors would:
• Focus on "core brands": Chevrolet, Buick, GMC and Cadillac
• Launch predominately high mileage, energy-efficient cars and crossovers
• Sell Saab, HUMMER
• Sell or kill Saturn
• Reduce Pontiac to a "niche" brand
• Trim dealerships from 6,450 to 4,700
• Reopen talks with UAW to cut manufacturing costs further
• Reduce total workforce from 96,000 to 65-75,000
• Negotiate with lenders, remove $35.6 billion in debt
In addition to the immediate loans or grantees Ford and Chrysler are promoting vehicles that would qualify as "Advanced Technology Vehicles" under the U.S. Energy Independence and Security Act’s Section 136 (pdf) which would enable the companies to receive loans aimed at assisting the manufacture of these vehicles.
Ford hopes for $5 billion in direct loans by 2011 and Chrysler $6 billion. General Motor’s plan does not mention Section 136 but no doubt the Chevy Volt and its hybrids would qualify.
Helping their case may have been the terrible November sales numbers that were released today and showed an industry wide plunge in sales that affected both domestics and imports alike. General Motors sales fell 41.3%, Ford 30.6%, Chrysler 47% while Toyota was down 33.9%, Honda 41.6% and Nissan fell 42.2%.