The Great GMI Analysis of the US Auto Market: C4C edition!

[2002 Caddy]

Originally Posted by desmo9

How about national debt? Forget that one?

We survived the HUGE spending increases and national debt explosion, under FDR, under Eisenhower, under Reagan, and under Bush 43. We will survive it this time too.

Survived is the wrong word... THRIVED is the right word.

Oh and Nation Debt is not even close to our biggest problem... Everyone should be screaming about the Balance of trade and the "off shoring" of jobs. As long as that trend continues our economy and our "way of life" is doomed.

[desmo9]

Originally Posted by 2002 Caddy

We survived the HUGE spending increases and national debt explosion, under FDR, under Eisenhower, under Reagan, and under Bush 43. We will survive it this time too.

Survived is the wrong word... THRIVED is the right word.

Oh and Nation Debt is not even close to our biggest problem... Everyone should be screaming about the Balance of trade and the "off shoring" of jobs. As long as that trend continues our economy and our "way of life" is doomed.

But national debt and trade deficit are about the same thing. We're borrowing more money because we're sending more money out of the country due to the trade imbalance. I think if you add up the cumulative trade deficit, it's about equal to the national debt. Quite a concept. But as more and more manufacturing disappears, the likes of the current administration would rather throw money into the economy to compensate rather than fix our trade policy.

[44 mpg by 2010]

Originally Posted by desmo9

But national debt and trade deficit are about the same thing. We're borrowing more money because we're sending more money out of the country due to the trade imbalance. I think if you add up the cumulative trade deficit, it's about equal to the national debt. Quite a concept. But as more and more manufacturing disappears, the likes of the current administration would rather throw money into the economy to compensate rather than fix our trade policy.

Let's assume you are correct that buying imported vehicles does shift trade balance more"negative". But that applies equally to Detroit and foreign OEMS.

Still the money made in domestic distribution and money made by the dealerships (sales, parts, salaries/commissions, and service) all stay in the US.

During C4C over 50% (maybe 56%) of all C4C purchases were built in the US. So a very significant portion of the funds generated by these sales stayed in the US to cover domestic content, assembly, domestic overhead/distribution plus money made by the dealerships (sales, parts, salaries/commissions, and service).

I find it very interesting that most critics of C4C have extreme difficulty accepting the fact that replacement C4C vehicles reduce crude consumption about 12 MILLION BARRELS PER YEAR ... reducing oil imports by a like amount eliminating $0.9 BILLION in imported crude oil purchases annually @ $75/barrel.

That is a direct reduction of "imbalance of trade" putting $0.9 BILLION back into the US domestic economy generating roughly $4.5 BILLION in taxable domestic economic activity resulting in $0.9 BILLION in "new" tax revenues ... ANNUALLY!

This is a very simplified explanation ... but it covers the main points.

If you want more detailed explanation ... ask ... 2002 Caddy. Maybe he can explain it so you understand.

FWIW ...

[2002 Caddy]

Originally Posted by desmo9

But as more and more manufacturing disappears, the likes of the current administration would rather throw money into the economy to compensate rather than fix our trade policy.

You would probably be completely blown away when you discover which administrations got our trade policy to the current mess that it is.

In the 50's, 60, and 70's our Deficit was not an issues, 'cause it was mostly Americans owning money to American's in the early 80's this started to change and basically accelerated out of control since then.. Only one Administration since 1980 did anything about this problem... One actually got the deficit under control and balanced the budget... But even that guy did nothing to work on "fair trade"... Since 1980 we have been focused on "free trade". You are right is insane. I don't believe in protectionism... but I do believe in a level playing field.

Our current administration is about to place trade restrictions on low price, questionable quality, Chinese tires...The first aministration since the 70's to do something so bold... I await your arguement as to why protecting jobs and lives is bad.

[desmo9]

Originally Posted by 44 mpg by 2010

Le

I find it very interesting that most critics of C4C have extreme difficulty accepting the fact that replacement C4C vehicles reduce crude consumption about 12 MILLION BARRELS PER YEAR ... reducing oil imports by a like amount eliminating $0.9 BILLION in imported crude oil purchases annually @ $75/barrel.

That's a poor assumption, no? I know that I criticized the money we offshored in C4C as a result of auto revenues alone. It's pi$$-poor logic to conclude from that, that I (presumably I fit your "most" subgroup) have difficulty accepting the positive impact on the energy side.

And here's the point -- what if the program had NOT offshored half the auto money and kept double the funds here, while retaining most or all of the reduction in crude benefit?

They're mostly mutually exclusive elements. Your association of the two, that arguing one point means you don't understand or consider a second and independent point, is flawed.

[44 mpg by 2010]

Originally Posted by desmo9

That's a poor assumption, no? I know that I criticized the money we offshored in C4C as a result of auto revenues alone. It's pi$$-poor logic to conclude from that, that I (presumably I fit your "most" subgroup) have difficulty accepting the positive impact on the energy side.

And here's the point -- what if the program had NOT offshored half the auto money and kept double the funds here, while retaining most or all of the reduction in crude benefit?

They're mostly mutually exclusive elements. Your association of the two, that arguing one point means you don't understand or consider a second and independent point, is flawed.

I just happened to re-read your post and believe it deserves a response.

Your observations and conclusion are within reasonable bounds regarding similarities/differences between importing vehicles and oil. And I would agree that the model I use to describe impacts is grossly over simplified ... but the best I could think of for a general audience.

The primary difference is that the purchase of the imported vehicle is a "one time event", while oil imports (a consumable) continues for the "life of the vehicle", usually 15 to 25 years.

I too wish that more of the sales had been domestically manufactured! The domestic economic contribution would have been significantly higher (probably injecting a one time boost of roughly $4.5~$7.5 billion injection into OUR economy)!

However, if the C4C buyer wanted above 30 mpg(US) combined average fuel economy, what were their choices from Detroit (domestically built or otherwise)? And apparently, somewhere between 15% and 23% did purchase vehicles rated above 30 mpg(US) combined average!

The only vehicles that I found available from Detroit were Ford's Escape/Mariner/Fusion/Milan Hybrids. I am reasonably certain these were in relatively short supply.

I also think we can agree that decisions regarding what products to offer in the US market are the responsibilty of the OEMs' management. The consumers' responsibility is "best fit selection" based on need/want from existing offerings and that includes the decision "not to buy".

So, C4C/August sales are "as reported" and the economic impacts will be re-analysed for months/years to come.

Thanks for you observations, thoughts/time, and comments.

[mikmak]

Lol. This is my kind of p0rn

[Bravada]

If I didn't know you have a wife, I would seriously be worried (what can I say about myself...)