One day after he fired General Motors' CEO, Barack Obama announced that the federal government is not interested in running the onetime auto industry powerhouse. During that same speech, Obama said the feds will back up GM's warranty commitments.
How?
Let's take example my Ford. Until the problem was finally fixed, the dealership had to replace the car's fuel pump three times. What if the government-guaranteed warranty stipulates just two? Or will feds say, replace the engine, no matter the cost?
Meanwhile, Obama is encouraging a Chrysler alliance with Fiat. Obama, who drove a Chrysler gas-guzzler until the media blew the whistle on him, wants the deal to go through, which would involve the Italian automaker acquiring a 35 percent interest in Chrysler as well as a sharing of technology between the two firms.
Maybe that's not the right move. German auto manufacturer Daimler used to own Chrysler--that didn't work out too well. Mark Phelan of the Detroit Free Press doesn't think Fiat will help Chrysler.
Unfortunately for the American taxpayer, Obama and the Democrats feel they owe the unions for their recent successes at the polling place. A reworking of union contracts is in order, but the Dems won't force the United Auto Workers to bend.
A bankruptcy court will, and that's where I still believe GM and Chrysler will end up.
Related post:
Obama in full hypocrisy mode in comments about gas guzzlers
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