Auto Industry Rescue

Now there's a U.S. auto industry bailout plan for $25 billion in loans. And
according to the plan the auto makers would have to meet standards of fuel
efficiency for their competitiveness, they would have to produce advanced
vehicles, and they would have to restructure for long term viability.

Well requiring that the auto makers meet fuel efficiency standards could
likely just push them to produce small cars that consumers might not get
into. See the U.S. consumer will accept cars of normal size that weigh less
but the U.S. consumer is not going to accept simply smaller cars. Or the
auto makers might be pushed into smaller engines in the current size and
weight cars and that would represent a loss of performace standards. Then
the consumer might not accept the drop in performance standards. (Now the
auto makers are not inclined to produce standard size vehicles that weigh
less because they want to maintain the uni-body method of construction.)

But the auto makers would be required to produce advanced vehicles ? Now the
problem with advanced vehicles is expense, inconvenience, and possibly loss
of performance standard...unless they are talking about advanced vehicles
that are not really advanced. In that case they might be talking about
gas/electric hybrids, about natural gas vehicles, about turbo diesels, about
small gas tubo engines, about lightweight technology such as that used by
Lotus cars, or about engines with four-valve heads, VVT, and direct fuel
injection.

Well...there is an existing proving ground of what works...and it's a big
proving ground...it's Europe. And what has worked for auto makers in Europe
who want to maintain the uni-body method of construction...is the turbo
diesel. (The gas/electric hybird is no contest as performance standards are
not maintained and as its small mileage advantage is lost on cross country
driving.) Now the 50 state MB E-Class turbo diesel gets about 10% less fuel
mileage than the 45 state MB E-Class Turbo diesel so the turbo diesel
struggles a little here.

Now an advanced vehicle could be a vehicle that uses lightweight technology
like Lotus cars or even like the Chevrolet Corvette. (But that gives up the
uni-body method of construction and the car makers will do anything but
that.) And the lightweight vehicle could have an engine with four-valve
heads, VVT, and direct fuel injection.

But we know that U.S. politicians favor gas/electric hybrids. Of course they
don't understand that the hybrid using a base engine and carrying two
powerplants represents a loss of performance standard. Or that the vehicle
characteristics are not consistent as the car switches between powerplants.

So my plan for advanced vehicles would simply be to limit engine size and
let the car makers scale the vehicle weight to the engine size. Four and
five cylinder engines would be limited to 1.8 size, six cylinder engines
would be limited to 2.8 size, and eight cylinder engines would be limited to
3.2 size. And all engines would be required to have four-valve heads, VVT,
and direct fuel injection rather than port fuel injection. But since I
already mentioned that the auto makers might be pushed into making cars that
are too small or pushed into using smaller engines in current cars...then a
minimum power-to-weight ratio might be required for each category and a
minimum wheelbase length might be required for each category. Wow !
Designing cars by legislation gets out of hand quickly...

But the auto makers must restructure for long term viability ? Sure but my
plan for putting capital into the U.S. auto makers would be that the
government buys shares of stock with the capital put in and the cost of the
stock would be the 52 week stock low. Then if the auto makers could not
issue that much stock they could make semi-annual payments on a loan value
and pay in cash or pay in stock (valued at the 52 week low).

But a restructured U.S. auto industry simply owing loands might manufacture
in Mexico ?
 >> Stay informed about: Auto Industry Rescue 

> Now there's a U.S. auto industry bailout plan for $25 billion in loans.
> And according to the plan the auto makers would have to meet standards of
> fuel efficiency for their competitiveness, they would have to produce
> advanced vehicles, and they would have to restructure for long term
> viability.
>

Oh a compromise is needed...so if requiring that the U.S. auto makers
produce advanced vehicles...then just require engines with four-valve-heads,
VVT, and direct fuel injection rather than port fuel injection. Of course
that's in addition to the fact that they will have to meet CAFE standards
anyway...

Now since that's both a 10% increase in fuel mileage and a 10% increase in
power...then limit four-cylinder and five-cylinder engines to 2.16 size,
limit six-cylinder engines to 3.24 size, and limit 8-cylinder engines to
4.14 size. Of course I just reduced a 2.4 engine to 2.16, a 3.6 engine to
3.24, and a 4.6 engine to 4.14. But that would apply to all cars domestic
and imported. But surely they can reduce weight 5% so limit the four and
five cylinder engines to 2.04 size, limit the six cylinder engines to 3.06
size, and limit the eight cylinder engines to 3.91 size.
 >> Stay informed about: Auto Industry Rescue 

On Nov 12, 11:37 pm, "PolicySpy" <PInt....RemoveThis@notmail.com> wrote:
> Now the U.S. auto industry is in financial trouble...
>
> And the President-Elect proposal is that the U.S. auto industry get $50
> billion in loans and then have a Czar that oversees agreements related to
> the loans.

Sounds good...saving US jobs, wealth, industrial base, and revenue
stream.
Let's do it.
 >> Stay informed about: Auto Industry Rescue 

> Now the U.S. auto industry is in financial trouble...
>

And the debate is growing about a U.S. auto industry bailout...

Well for example...let's bailout GM. GM gets $12 billion in government funds
while the government gets four-billion GM shares in exchange. Now the
current shareholders with 610.46 million shares go from owning 100% of the
company to owning 13.24% of the company. And so the government becomes
86.76% owner of the newly re-capitalized company. Now the government as the
dominate shareholder can put its own board of directors in place to run the
company. And in some future year when things are better the government can
sell its holding at a fixed price offering. Also if the current shareholders
do not want to authorize the new share issue then they could have a tender
offer made to them at $3 a share and good for a year in exchange for the
authorization. And so if the current shareholders are bought out then the
total bailout goes from $12 billion to $13.8 billion. Now if we predict that
the company is good for $100 billion in revenue during future years then
that's a price-to-sales ratio of...a very low number.

So the question is...will $12 billion in funds save GM ?
 >> Stay informed about: Auto Industry Rescue