Capitol Hill Blue Forums Political Issues Finance, the economy & Economics Bailing out the auto industry - yes or no?

Ford sells a Fiesta with a diesel engine in Europe that gets 60 miles per gallon, but maintain that they can't produce it here. Huh? I realize that you've got to retool and ramp up, but really? Maybe it doesn't make as much on a cost per unit basis?

It costs almost nothing...we're talking about engine swaps and dickering with the diesel air pollution controls a little bit.
That's all.
The Big Three should have started offering small and efficient four cylinder diesel models four years ago as an option on most of their midsize and compact cars and minivans.

A guy up in Canada posted a YouTube video about two years ago that showed how easy it was to drop a 1.9 liter VW TDI diesel into a Dodge Caravan. He gets 52 miles per gallon. What soccer mom wouldn't jump at the chance to get that kind of fuel economy?
It would be a bargain even at 40 MPG.

The Big Three could just buy up VW's production of 4-banger diesels right now and have the 2009-1/2 model year sedans and minivans ready to go before spring.

This isn't rocket science.

Now, take that same 4-banger diesel and slap the electric portion of the Chevy Volt drivetrain to it, minus the battery pack.
Tune the diesel for "narrowband RPM power output" (between 1240-2000 RPM)
Now you're getting almost 75-80 miles per gallon.

One of my reasons for supporting some kind of bailout is this:There are certain industries that are necessary to have at home, and vehicle production is one of them. I believe that there is room for niche markets (e.g. the Tesla) to produce eco-friendly vehicles, but encouraging the same from the major manufacturers is something that will help us all in the long run. In addition, that capacity can be used to develop other "people movers" and innovation that only the "big guys" have the capacity to engineer/support (think R&D). That they have failed to do so sufficiently is, in my opinion, obvious. As with the banks, I HATE that taxpayer money is going to support poor planning and management, but it is the cost of allowing too much of the employment base to be in particular industries. By the way, I believe that these fixes will only slow, not prevent, the collapse of the industrial base. But, it will be sufficient, I hope, to give the employees time to find new career paths.

As i think more on this, why not couple a loan program with a public transportation initiative -- use some of the loan funds to re-tool for bus and rail car production. Sort of undo the often alleged plot to kill public transit in the later 50's early 60's

That would work. I remember one of GM's first responses to the energy crisis back in the 70's. They put a diesel in a Chevette, but leave it to Detroit to screw up a good idea. They just took a gas engine and modified it to diesel, which doesn't and didn't work. Another innovative idea that they screwed up royally was the Fiero. It was a sporty little car that drew an immediate market, but the manufacture and quality control was terrible. A young lady that I dated at the time bought one of the first. Nice looking car, but even simple things like the door weather stripping was shoddy and whenever it rained it was a disaster. I'm also with Pelosi and the democrats insisting that Detroit shows them their plans for the money before Detroit gets the dinheiro. I suspect that one reason Congress wants to see the plan is this.Call me a nationalist, but that money should be spent employing Americans and not Brazilians.

Maybe it's silly of us to think that these Global Corporations would continue to invest any money at all(even taxpayer money)into the failing American market. They can leave the unions behind and retool in other countries where labor is cheaper. The emerging markets elsewhere may be far more lucrative. Bear in mind that GM, Ford, and Chrysler will use the bailout money to protect their own interests, we are thinking about what they could do with the money to protect our interests. If it's more profitable to invest that money offshore that's where it will go.

The Chevette was not the only car GM attempted to shove a converted gasoline to diesel engine into. They tried that in many of their cars including a Pontiac station wagon with a V-8. As you said it, was a disaster because diesels run under vastly higher compression than gasoline engines can handle, so those engines gave out quickly.

Then there was the Cadillac 8-6-4, whereby as one was accelerating the engine would start on eight cylinders and then work down to 6 then 4 as it was cruising on the highway. This actually was not a bad idea and was an idea before its time. Honda now uses a similar technology in its new Accord V-6 engine. The problem with the Cadillac was, as usual, GM unleashed a technology way before the bugs were worked out so the ideas proved disastrous after a short time on the market.This also help fuel the perception that American cars were crap, and Japanese cars were better (they were). The Japanese tended to work out the bugs before selling new technology to the public, and still do. This was just a small description of the disaster American cars were during the 1980.

And I also remember the Pontiac Fiero. As it came out in the early 80’s, people kept calling it the Ferraro after Geraldine, Mondale’s VP pick.

---Nope sorry...the diesel Chevette was not one of those.
It used an Isuzu diesel engine, and it was and still is one of the most dependable Chevettes ever made, with the engine far outlasting the rest of the car. The Isuzu four cylinder diesel is the workhorse behind approximately 40 percent of the small diesel cars and light trucks manufactured by GM for the rest of the world and it continues to be today as well.
You're thinking of when GM took a couple of their small block and big block gasoline V-8 engines and modified them to diesel.
That's old history too.
Today GM pretty much designed their V-8 diesels from the ground up and they work very well. Unfortunately they're large, and built for tasks that require bone crushing power, not high fuel economy.
The Geo Diesel was also a winner...basically a rebirth of the Chevette, only I don't remember if they stuck with the Isuzu diesel or used two choices. I'll get back to you on that one.


---The Fiero was another Corvair, that is to say it was subjected to endless committee redesigns in which corporate big brass culture continually cheapened the original design to save a nickel here and a dime there. What started out as a fantastic idea was "dipped in acid" until all the good parts had been
melted away and all that was left was a cheaply designed shell into which the equivalent of "a tractor motor" was dropped.

What you're referring to is a constant in all of General Motors culture...make a revolutionary design, chip away at it until almost nothing is left, bring it to market, let year one owners be the guinea pigs, then slowly reintroduce the parts you chipped away at in response to massive complaints, then finally restore most or all of the original design, and if you're lucky the car will survive and by year four or five will be a very good vehicle.

Corvair had most of its good stuff restored by year three (1962)
but it was killed by Ralph Nader's ignorant book which concentrated on deficiencies found in the first three model years. Had the Corvair 1970 models been made, Porsche was seriously considering withdrawal from the American market, at least for the time being, because Corvair's models outperformed them in 1968 and 1969!


---Believe it or not, Brazil might be the key to our GM problems here at home. Brazil's GM division is currently making some of the most efficient small cars and light trucks in the world, AND the most flexible in terms of fuel choices too.
Take a look at what Brazilians are driving and see for yourself.
The Chevy Aveo, which IS a GOOD small GM car, is a Brazilian knockoff, and is successful at least in its native carioca trim anyway.
Basically if GM is forced to bring the Brazil designs and models HERE, we'd be in very good shape, so let them help Brazil as long as it helps us at the same time and not JUST their pocketbooks. What's good for GM Brazil CAN be good for America, if we force them to work it that way.

Re Pelosi:
Unfortunately no matter how good a CAR idea is, if Pelosi is involved it will be a terrible idea by the time she is finished with it. I agree with her that we need to see a plan before any money is disbursed. I don't want her grubby little fingers anywhere near the nuts and bolts of the plan however.
She will only listen to idiots who pose as automotive experts.

For an idea like this we actually need an ACTUAL CAR EXPERT, someone who has proven themselves. It's too bad that most of the best ones are either dead or in no mood to tackle a Congressional Committee. I'd love to hear Iacocca's ideas, because he's one of the only car guys to get money from Congress and repay it ahead of time WITH INTEREST.

And I am sure that he would agree that Nancy Pelosi doesn't belong anywhere near the planning table.

--Actually, as I mentioned in my above post, ALL of this (the erroneous Chevette reference aside) relates to the pervading corporate culture of General Motors as a whole in this country.
GM's US operation has always reacted to its top heavy debt load from labor by chipping away at good designs to save a nickel here or there.

If you look at almost ANY "year one" GM model, with few exceptions you find that the first year model is full of bugs in any area where innovation plays a part. By the third or fourth model year those bugs are RELUCTANTLY FIXED.
By that point it's just a question of whether or not the model survives.
Here's another example...the Chevy Astro. Believe it or not there IS a very real need for a TRUCK BASED small van with gobs of towing power and heavy duty reliability.
But the Astro models from 1989 till 1991 were plagued with weak front end suspension pieces and a worthless slug of an engine for the most part. They also suffered from ghastly interior trim which fell apart almost from the first day of use and terrible driver's seat crampiness.

But by 1992 the engine choices had new life breathed into them with the introduction of the improved Vortec V-6 4.3 liter, which was basically a high performance GM truck type V-8 with "the two rear cylinders chopped off".
Everything else about it was a true high torque V-8.
The interior pieces were still ghastly, the electric window switches still stopped working within a year and the driver still had no room to put their feet if they were taller than
five eight or had big feet but at least it could pull a trailer
and it lasted about 250 thousand miles with normal maintenance.

By 1994 and the final redesign Chevy's Astro van was a comfortable workhorse that could fit in any small garage, haul large trailers and even go off road with the available four wheel drive option, and it even HANDLED decently...for a VAN.
But of course by that time enough people were pissed off at the prior year deficiencies that when other choices from other makers came out, they chose something else, and GM lost its share of the market, and Astro was retired.

Everything that rolls of a GM line is fixed IN THE MARKETPLACE.
With the exception of exotic sports coupes and the top end luxury vehicles, if it's GM, YOU are the test bed.
If it's a mundane people mover or anything else with four wheels, GM tests it IN the marketplace, always has and always will. This is a systemic problem with the GM culture and cannot be fixed unless someone surgically removes the pigheaded thinking that fosters it.