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Automobile industry

Auto Industry Leaders Seek Support on Health Care and Trade Issues at White House Meeting

Strategic Insights

— 1 min read

President George W. Bush will meet with top executives from General Motors, Ford, and Chrysler today to discuss the challenges facing the auto industry. Industry leaders plan to stress that they are not seeking a federal bailout but want support on health care and trade issues that affect large manufacturers. The auto industry is facing significant challenges, including soaring health care costs and trade issues with Japan and China.

Key Takeaways:

  • Auto industry leaders are seeking support on health care and trade issues, but not a federal bailout.
  • The industry is facing significant challenges, including soaring health care costs and trade issues with Japan and China.
  • General Motors spent $5.3 billion on health care last year for 1.1 million employees, retirees, and their dependents.
  • Ford posted a $5.8 billion third-quarter loss, while GM reported a loss of $91 million.
  • Chrysler Group had a $1.5 billion third-quarter loss, but was helped by profits at its parent company DaimlerChrysler.
  • GM and Ford are both engaged in large downsizing plans, with GM persuading 35,000 hourly workers to leave and Ford offering buyouts and early retirement to all 75,000 U.S. production workers.
  • Industry leaders will discuss the need to level the playing field on currency issues, citing Japan's weakened yen and China's artificially low currency.
  • The meeting is a rare gathering between the President and top auto executives, and is expected to focus on national issues affecting the industry.

Statistics:

  • $5.3 billion: The amount General Motors spent on health care last year.
  • 1.1 million: The number of employees, retirees, and their dependents covered by General Motors' health care plan.
  • $5.8 billion: Ford's third-quarter loss.
  • $91 million: GM's quarterly loss.
  • $1.5 billion: Chrysler Group's third-quarter loss.
  • 35,000: The number of hourly workers persuaded to leave General Motors through early retirement or buyout plans.
  • 75,000: The number of U.S. production workers eligible for buyouts and early retirement at Ford.
  • 15%: Toyota's target market share by 2010, according to The Wall Street Journal.

Sources:

  • The Associated Press, "Auto Industry Leaders Plan to Stress White House Meeting They Are Not Seeking Bailout".
  • The Wall Street Journal, "Toyota Aims to Capture 15 Percent of Global Market by 2010".
  • Boston Globe, "GM's Health Care Costs soar 28%".
  • The Associated Press, "GM's Profit Boosts Growth in First Quarter".
  • Reuters, "Ford Posts Record Quarterly Loss".

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