Public still opposes auto bailout, poll finds

By Paul A. Eisenstein, The Detroit Bureau

While the U.S. auto industry may be “back,” as President Barack Obama recently declared during his State-of-the-Union address, that hasn’t changed the fact that a majority of Americans remain opposed to the 2008 – 2009 bailout of Detroit.

A new Gallup poll finds 51 percent of those surveyed still disapprove of the $85 billion rescue effort, with only 44 percent saying they approve.  And the figure is even more lopsided when party affiliation is consideredD.  The poll, conducted for the public radio program Marketplace, found 73 percent of Republicans opposed – though 63 percent of Democrats were supportive of the bailout.

Americans keeping cars longer than ever

Though the results are still in negative territory, overall, that’s still a significant improvement from 2009, when various polls showed that the vast majority of Americans, regardless of political persuasion, were unhappy with the use of taxpayer money to save General Motors and Chrysler.

The numbers have been slowly moving back into positive territory, various surveys have found, especially as the two once-bankrupt makers have started posting solid earnings again – and have been adding thousands of new jobs.  On the other hand, reports that the U.S. Treasury could still lose perhaps $20 billion on the bailout – especially if GM’s stock price doesn’t rebound – continues to throw up a red flag.

Hertz asks for federal oversight for recalled cars

And the GOP presidential contenders all but trip over one another in debates and stump speeches, to turn the bailout into a liability for President Barack Obama.

During a Wednesday night Republican debate in Phoenix, former Massachusetts Governor Mitt Romney said, “I think it was 2008, President Bush was still in office. And the three chief executive officers of the three major auto companies got in their private planes and flew to Washington, and said: please write us a check. I think they wanted $50 billion. And I wrote an op-ed in the paper and I said: absolutely not. Don’t write a check for $50 billion.”

Toyota turn to fleets to inflate sales

While the bailout is likely to remain a subject of contention for some time, the new Gallup poll isn’t entirely negative for the auto industry overall.

“There was a time when the auto industry and our positive/negative image ratings was down at minus 35; that was in 2009,” said Gallup editor-in-chief Frank Newport. “In fact, it was second only to the oil and gas industry, which interestingly — perennially — pulled up the bottom on that.”

Now, he noted, the auto industry is back in positive territory, with a plus-10 rating.  That’s still well below the image of the computer industry but well ahead of oil and gas – and the federal government, which now ranks dead last

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GM chief says public is past anger over bailout

DETROIT — The American public has gotten past its animosity toward General Motors for taking a government bailout in 2009, the company's top executive said Thursday.

Chairman and CEO Dan Akerson said a poll taken last summer for GM by Washington public opinion firm Peter Hart Research Associates shows that more than 70 percent of Americans have a positive opinion of the company. When the same poll was taken in July of 2009, more than 70 percent had a negative opinion, Akerson said.

"I think America loves a competitor. I think General Motors, Chevrolet in particular, is part of Americana," Akerson said during an appearance at the Detroit Economic Club.

In 2009, GM, saddled with high debt and expensive labor costs, needed $49.5 billion in government loans to survive a trip through bankruptcy court.

The U.S. government got a stake in the restructured company, part of which was sold in an initial public stock offering about one year ago on Nov. 18, 2010. The government's remaining 500 million shares would have to sell for around $53 per share for the U.S. to break even. Such a sale probably won't come anytime soon. GM shares are trading around one-third less than the $33 IPO price.

The summer before the IPO, then-GM Chairman and CEO Ed Whitacre said government ownership was hurting the company's sales. Whitacre said GM didn't want to be known as "Government Motors."

But Akerson said on Thursday that the new GM is now making money and has passed that stage.

"I do think that we've kind of gotten over that," he said.

GM made a net profit of just over $7.1 billion in the first nine months of the year.

Akerson said the government doesn't get involved in running GM. But he's concerned about government pay limits for companies that took bailout money. GM, he said, won't be able to give bonuses to its 25 highest-paid executives — even though it could make $8 billion or $9 billion this year.

"We've got some very, very good people that could do well at other companies who are doing this one for the home team," he said.

Akerson pinned the drop in GM's stock price on the broader economy, not automaker's performance. Shares of General Motors Co. were down 96 cents, or 4.2 percent, to $21.69 in afternoon trading Thursday. They're down about 41 percent for the year, slightly worse than the 40 percent drop in shares of Ford Motor Co.

Akerson also said GM will take actions to right its money-losing European operations. He referred to French competitor Peugeot Citroen SA's plan cut 6,000 jobs because of flat demand in Europe, although he stopped short of saying there would be plant closures or layoffs at GM.

He said the government debt crisis in Europe could have a larger impact on the U.S. than the 2008 financial meltdown and recession, because Europe is "a hugely and important cultural and economic center of gravity for the world."

Last week GM said its third-quarter net income fell 15 percent from a year earlier to $1.7 billion, partly because of a pretax loss of $292 million in Europe. The loss forced GM to back off an earlier forecast of breaking even in Europe this year.

"Clearly you can't have a unit as important as Opel is to General Motors chronically unprofitable," he said. "It's not sustainable and it's not good for the company."

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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Chrysler in the no ' rush' to public to go, says CEO

NEW YORK-Chrysler Group LLC in no hurry to the public, said Chief Executive Sergio Marchionne Wednesday, added that "technically" not equity must increase the U.S. based automaker.

Ask whether an initial public offering was possible in the fourth quarter of 2011, Marchionne told reporters in New York, that the time of the IPO in concert with other stakeholders in Chrysler would be decided. Marchionne is also CEO of Italian automaker Fiat SpA.

"There is no rush, it done, but we will do what suits whatever the interests of the members," Marchionne said. "Chrysler technically must increase not equity." "Once we have the debt refinancing in the village are fine we."

Marchionne was in New York with bankers and others meet as it stands, to help $6 billion in a term loans and bonds, Government repay high-interest loans to increase.

The meeting took place in a conference room on the third floor of the Hilton Hotel. Outside of Chrysler displayed three cars: the Chrysler 300 sedan, the subcompact Fiat 500 and the Jeep Grand Cherokee.

More with $7.5 billion in loans in 2009 to help it reduce the U.S. and Canadian Governments Chrysler.

The Treasury was also Fiat management control of Chrysler and a 20-percent stake. In 2011, it was after a meeting with requirements by the Government, Fiat stake increased to 30 percent.

Chrysler launched 16 new and updated passenger cars and trucks in 2010, and this week reported its first net profit since the bailout. At the end of March Chrysler had 9.9 billion $ in cash.

Chrysler has said that he would like to complete the refinancing by end of June, with nearly $1.3 billion in cash by Fiat.

The refinancing of Chrysler set on a firmer financial foundation and consumer confidence in the brand, with the help, paving the way for an initial public offering strengthen.

"If you're going to do the initial public offering, I had always the view, which you should show up with a nonsupportive balance sheet not," Marchionne said.

"You must realize the capital markets the value of what we have done, and give you the IPO cycle," he said. "So hopefully we should have to end may different discussions."

Marchionne said Chrysler still hope $3.5 billion in loans from the US Department of energy, expands heavy truck, conversion to help seal meet higher fuel economy standards.

Chrysler initially was that the DOE Government repay loans could be used loans to free up cash.

In January, moved General Motors co its call, DOE loans, say that it had vehicles-saving the financial strength to finance investments in fuel.

"GM technically could claim for funding." They said they need not the DOE money and that's fine. It said its decision, "Marchionne.""I am not in the box."

Last week, Marchionne told reporters in Detroit that the DOE would allow loans Chrysler to "Step change" to help transform its line-up.

Copyright 2011 Thomson Reuters.

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Zipcar revs for initial public offering

NEW YORK-Zipcar Inc., the car-sharing company that rented rides for less than an hour, will receive expected to this week a warm reception from Wall Street for its planned initial public offering.

His followers think, skyrocketing gas prices car-sharing always popular will. You praise Zipcar's technologically-savvy and their plans for overseas expansion.

"Zipcar one of the long-awaited hot tickets in the IPO Valley," said John Fitzgibbon, founder of the IPOscoop.com. Investors are, IPOs again warming up to the market of 2008 and 2009 sputtered.

However, Zipcar was never profitable, since its inception in the year 2000. It expects to lose money again in 2011. Cars, his most important costs are not cheap.

The IPO value he would total in the middle of the expected price range around $125 million from $14 to $16 per share. The company expects revenue of about 89 million $, $46 million, of which plans you to use to pay down debt.

The company plans to trade on the NASDAQ Stock Exchange under the ticker symbol ZIP. The offer is expected to award Wednesday night, to start Thursday with the stock to trade.

In contrast to a car rental program requires no Zipcar customers a store of value key pick up to visit. Lieber, members pay an annual fee of $60 and $25 application fee to join and get a keycard. Cars are parked in their city.

Members go online to reserve a car in the vicinity, and their key card unlocks it. Hourly rates vary, typically less than $ 10. customers pay no gas.

While Zipcar, that it more cities identified dozens where it could succeed says, there are questions how far it can expand. His model works best in densely populated areas, where many residents have cars.

Zipcar, based in Cambridge, Massachusetts, is a giant among U.S. car sharing programs, operating in 14 cities. Most of its competitors are only one. It bought it major direct competitor, Flexcar, 2007.

However, Enterprise and Hertz car rental companies have their own car-sharing programs. An alliance called the CarSharing Association was also recently Zipcar's smaller competitors.

Zipcar expands campus with cars quickly on the College up to 230 colleges, up to 150 in June. Last year it moved overseas by buying u.k. rival tram Ltd.

Zipcar says that there are more than 100 u-Bahn areas around the world and hundreds of other universities as attractive markets has identified.

"If it works, then is anyone going to make a lot of money," car analyst Michael Millman said. "If it don't take I they can always the contract for the smaller and more profitable to be."

Millman said he is not sure if Zipcar's losses so far are a concern.

"I of which is, if they have a profit wanted to they could have a profit," said he, "but then they have to give up or delay growth."

Investment groups including Norwegian investment company Smedvig capital AS and a number of individual investors are also selling shares and part of the IPO proceeds.

Zipcar gets praise for the use of the technology: for example, members can receive text messages, if your reservation is almost on and to find out whether they can extend the rental.

The company has two tech prominent on its Board of Directors, AOL co-founder Steve case and former eBay CEO Meg Whitman.

Skyrocketing gas prices Zipcar in the short term, violate can, said Dave Brook, a consultant of CarSharing Portland in the year 1998 was founded. But she eventually interest drum could, he said.

Brook thinks turning point if car owners drive less than 5,000 miles per year. "" "That's when you start you think"I'm spending a lot of money for this car and not always a lot of value from it.""

Copyright 2011, the associated press. All rights reserved. This material may not be published, broadcast, rewritten or distributed.

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