Trollhattan Saab has changed!
The site you're viewing now is the original Trollhattan Saab weblog, though it's now an archive only and no new material is posted here. As of February 2009, all new material is posted at our new site - Saabs United.
Please join us at Saabs United and get your daily Saab fix from Saab sources all around the world.
Again, there’s been a lot of drama while I’ve been sleeping. Here’s the best of it and a few questions about the people asking the questions.
Compromise Bill sorted
The good news when I woke up this morning is that for an all-too-brief moment, it looked like a compromise had been reached and a set of conditions agreed upon that could be presented for a vote.
CNBC is reporting that four U.S. senators have reached a bipartisan agreement on a bill to help the Big 3 automakers in Detroit. Those senators include Michigan Democrats Carl Levin and Debbie Stabenow, Ohio Republican George Voinovich and Missouri Republican Christopher Bond. Details of the bill are not yet available, but a news conference is scheduled for 2:30PM EST, at which time we should learn more.
Enter the dragons
Before they cold hold that news conference, a few of the Senators decided to hold a conference of their own and they shot the whole thing down in flames:
Wow, what an amazing piece of political theater that just went down. As we reported, four senators from auto producing state (two Democrats and two Republicans) led by Michigan Senator Carl Levin have reached an agreement on a compromise bailout bill for automakers. They were set to announce details of the compromise bill at 2:30PM, but before they could, a team of Congressional Democrats led by House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid walked into the room in which the press conference was to be held and announced that they didn’t support the compromise bill and that CEOs of the Big 3 would have to come back after the Thanksgiving holiday and present a plan on how any loans that might be given would be used.
Clueless?
The Detroit News blog following these Senate hearings pointed out an interesting factoid the other day:
Is it just me, or does Congress show a stunning ignorance of the federal government’s own securities regulations? Several lawmakers have asked questions of the three CEOs today about their future financial projections that, if answered, would constitute a violation of the Security and Exchange Commission’s rules. They then get quite indignant when the execs say they can’t answer those questions.
Now, the question is…… does their new requirement – the the CEO’s bring their detailed plans on how money will be used before a bill passes – does that requirement also constitute a violation of SEC rules as well.
And even if it doesn’t, what sort of competitive disadvantage are they placing the Detroit companies in if they insist on this? Do you think the guys at Toyota and Honda won’t be listening intently?
——
I know, GM wouldn’t be having to mull this over if they had their house in order in the first place. And I know that when you ask for a loan of this size that you need to provide some accountability, but it seems to me that the Senators are acting like disgruntled board members.
Set general preconditions about executive pay or whatever. Have a closed hearing to discuss this corporate information. Do it smart.
Right now it looks like a bunch of yahoos grandstanding to get their heads on camera. Talk about fiddling while Rome burns!
5 responses so far ↓
1 eggsngrits
// Nov 21, 2008 at 9:44 am
Ah, Ms. Pelosi — still the best whiner-in-chief any political party ever had. She’s still not figured out that her party is in the lead. She still thinks like she’s in opposition. Harry Reid knows better, so I would have hoped that he would have made things less confrontational.
I agree with the comment about the forward-looking statements — the committee should know their own rule book.
There’s another train of thought forming in the US, I’ll post about that later tonight (it’s still not supper time on Thursday here in the Central US).
2 joemama
// Nov 21, 2008 at 10:36 am
Ummm…..having to explain what you need the money for first is just common sense.
Was that NOT part of the plan at some part? I mean, c’mon people…
Were they just going to hand over $25 billion?
3 eggsngrits
// Nov 21, 2008 at 12:21 pm
Joe: I agree, I assumed that they’d mostly had that conversation prior to the hearing. Before a bunch of Congressmen set up some huge meeting with CEOs in private jets one would think that a great deal of thought had gone into the reasons behind the request.
4 max
// Nov 22, 2008 at 3:46 am
FYI, following a pattern seen before, typical headlines before any major changes happen, comments on profitability is challenging. The Following from Automotive News
Saab to remain in N. America despite sales drop
John Revill
Automotive News Europe
November 21, 2008 14:31 CET
Saab will remain in the North American market despite a sharp drop in sales so far this year.
“The Saab brand is very attractive to U.S. consumers,” said Managing Director Jan-Ake Jonsson. “There are no plans to pull out at all.”
Jonsson reaffirmed Saab’s commitment to the US market, despite a sales drop there of 31 percent to 19,318 units in the first 10 months.
Sales in Canada were down 20 percent to 1,593 units during the period.
“We have been in North America for 50 years, we have a very solid footprint and a large car park there.” Jonsson told Automotive News Europe.
Sales in the U.S. had fallen because Saab was no longer chasing sales volumes at any cost, Jonsson said.
Despite falling sales, Saab is profitable in the U.S., Jonsson said.
He said: “The U.S. is a very important part of our strategy.”
5 PT
// Nov 22, 2008 at 4:08 pm
Interesting that you raise the private jets issue EnG. Front page news in the Financial Review ( only national Australian finance paper) was the commentary about how the senators had taken umbrage at the fact that the three CEOs had flown independently from Detroit on private jets to complain that they had no money. The basic premise was that nothing has changed in the upper management of the big three and if they get their $25Billion it will be wasted by the same kind of bad decisions that have got them into this state. It was quite funny actually. Not to mention probably correct.