| The Detroit Big Three CEOs earlier told a | | | | GM Chairman and CEO Rick Wagoner said the |
| Senate-sponsored manufacturing forum that the | | | | "domestic auto industry matters a lot," according |
| government can do more to aid the struggling | | | | to his prepared remarks. "Even at a time when |
| domestic auto industry. The executives called for | | | | our companies are taking the tough, but |
| more help on trade and health care policies. | | | | necessary actions to compete globally, GM, Ford |
| "While our industry has supported trade | | | | and Chrysler remain absolutely vital to the U.S. |
| liberalization, we have seen a diminishing focus on | | | | economy," Wagoner said. He asked for |
| manufacturing in United States trade policy," Ford | | | | congressional help "in addressing the woeful |
| President and CEO Alan Mulally said, according to a | | | | shortfall in E-85 distribution. If market forces don't |
| copy of his prepared remarks. "In recent years, | | | | rapidly increase the number of fueling stations |
| there seems to have been a willingness in trade | | | | that offer E-85, then regulatory solutions will be |
| negotiations to overlook or even trade off | | | | needed." |
| manufacturing's interests for those of other | | | | Additionally, Mulally called on Congress to oppose |
| sectors that are perceived as either sacred cows | | | | the South Korea Free Trade agreement, as did |
| or the new frontier," Mulally said. | | | | UAW President Ron Gettlefinger. He stressed the |
| Chrysler Group CEO Tom LaSorda said thatthe | | | | need for "a much needed re-emphasis on |
| auto industry is at a 'crossroads.' He added, "We | | | | manufacturing as a cornerstone of American |
| are either going to adjust to the realities of the | | | | trade policy." |
| global economy or we will not survive. Our current | | | | To note, U.S. has an $11 billion deficit in auto trade |
| cost model does not work and our competition | | | | with South Korea, 82 percent of the total trade |
| gets fiercer every day." | | | | deficit between the countries. What more, over |
| LaSorda noted "unfortunate parallels" between the | | | | 60 percent of the $85 billion trade surplus in Japan |
| automotive and the old steel industries, including | | | | with the U.S. is in auto products. |
| "large numbers of bankruptcy filings by auto | | | | South Korea is the ninth largest motor vehicle |
| suppliers and steel companies, large reductions in | | | | market in the world, yet more than 96 percent |
| the numbers of employees and staggering retiree | | | | of all cars sold there are made in South Korea, |
| costs that caused more than 200,000 retired | | | | Mulally said. "This defies the market trends |
| steelworkers to lose healthcare benefits." | | | | worldwide, it defies the logic of consumer choice, |
| Controversies in the auto industry come like an | | | | and it is a situation that would be impossible to |
| accelerating EBC Redstuff. Now, private equity | | | | sustain without the active intervention of the |
| firms are significantly involved in the domestic | | | | Korean government. South Korea exported |
| auto industry. Earlier, the Cerberus Capital | | | | 700,000 vehicles to the US market while only |
| Management LP, a leading private equity firm, | | | | 4,000 vehicles were exported from the United |
| agreed to purchase 80.1 percent shares of | | | | States to Korea." |
| DaimlerChrysler AG's Chrysler Group for 7.4 billion. | | | | LaSorda said that more must be done on health |
| "The auto industry is caught in a box where | | | | care costs. "I believe we could all agree that some |
| overcapacity, incentives, brand proliferation, and | | | | national approach to the healthcare problem is |
| the fight for market share has led to negative | | | | ideal but likely not feasible. Given the political |
| net pricing," LaSorda said. "We need our | | | | reality, there are some important interim steps |
| government to understand how its actions can | | | | Congress could take to help bring more rationality |
| either encourage, or set up roadblocks, to | | | | to the healthcare market," LaSorda said. |
| American competitiveness." | | | | |