Feds End GM/Chrysler Warranty Guarantees

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Feds End GM/Chrysler Warranty Guarantees http://tinyurl.com/n34y7j
In prepared testimony before the House Judiciary Subcommittee, Car Czarlet Ron Bloom revealed that the government would no longer back GM
and Chrysler warranties. “With the successful emergence of the new companies, consumers can now feel assured that the companies have the financial wherewithal to meet their warranty commitments on a continuing basis,” Bloom said. The $641 million spent by the government on the warranty program has been returned to the Treasury with interest, reveals Bloom. “This achievement represented a prudent short-term use of taxpayer funds,” was his conclusion. GM spokesfolks tell Automotive News [sub] that The General never even tapped the fund, while Chrysler reps are mum on the subject.
Bloom also tackled the tricky subject of the dealer cull. “Consistent with the Task Force’s role, we were not involved in the design or implementation of New GM or New Chrysler’s dealer rationalization plans,” he said. “We were not involved in any individual decisions about dealers, and we do not intend to be going forward.” But, but, but . . .
the companies have engaged recently with several members of Congress—including members of this subcommittee—about potential additional modifications of their review and reconsideration processes that would further increase transparency and objectivity for everyone involved. We have been supportive of this process, in our role as a facilitator, to ensure this process is transparent, fair and objective. However, the Administration strongly opposes the amendment to the Financial Services appropriations bill that attempts to restore prior Chrysler and GM franchise agreements.
Why?
Political intervention of this nature could also jeopardize taxpayer returns by making it far more difficult for the companies to access private capital markets if there is ongoing uncertainty about whether Congress will intervene to overturn judicially approved business decisions anytime that it disagrees with the judgments of the companies.
Some strong opinions there for a “facilitator.” But Bloom clearly feels that the stakes were high enough to justify his task force’s tough stances. Not that there aren’t some signs that Bloom (or Obama) has some doubts about the intervention. Bloom concludes
In a better world, the choice to intervene would not have had to be made. But amid the worst economic crisis in three-quarters of a century, the Administration’s decisions avoided a devastating liquidation and put a stop to the long practice in the auto industry of kicking hard problems down the road. The Auto Task Force worked quickly to assist GM and Chrysler and did so in a fair and open way. While difficult for all stakeholders involved, these transactions provide New GM and New Chrysler with a new lease on life and a chance to succeed.
Ron Bloom Testimony (Treasury.gov) » http://www.treas.gov/press/releases/tg222.htm
--
Civis Romanus Sum

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Well, that will destroy a lot of confidence in these companies as they struggle to keep their heads above water.
I was on the road yesterday, and passed a brand new Chrysler, and in the window, the sticker read "Sold as is - without warranty". I was curious at the time, but now it may make sense.
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hls wrote:

If GM/Chrysler acquire a reputation for warranty repair difficulties in the coming months/year they will never shake that. It is doubtful if they are smart enough to really work hard to honor warranties, most notably have a warranty (bumper-bumper) rivaling Kia's.
--
Civis Romanus Sum

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Most likely they will go under. Ticked off customer, ticked off taxpayers, brand damages in every corner. Even with $100T of taxpayers sweat the sub-zero credit rating will catch up to them. Future bond holds will not be so stupid, they will buy the asset from GM and rent it back, making it impossible for GM to skip as a welcher on debt.
Now that Bailout Obama has flushed the big wad of money into GM to bailout the influencial, doubtful a second round is coming. Congress and the senators are now getting ansy as some are up for elections and I smell a wipeout a coming. In short, the corrupt bastards are worried about their chances in 2010....
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The reference was to the NEW GM and Chrysler, who provide their own warranty coverage on the new vehicles they sell. The feds STILL cover those vehicles sold by the OLD GM and Chrysler, however

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Not so, you are obviously confused, once again. The feds will not back up the warranties of the NEW GM and Chrysler but they will continue to back up the warranties on cars sold by the OLD GM and Chrysler

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Looks like our friend "Always Wrong Canuck57," is reading the wrong stuff and drawing the wrong conclusions, again. LOL

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What makes you believe anybody in this NG cares what you buy with your own money and what does that have to do with you reading the wrong stuff and drawing the wrong conclusions, again? LOL

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They paid $641M back from over $100T taxpayer bilking? Hey Bloom, I have some beach front property for sale, real cheap...need a government bailout, LOL.
So in a nut shell, this means GM/Chrylser purchaser before they left bankruptcy, including fleet and individuals are all screwed on the warranty. SOL, suckered, duped... but might I suggest stupid?
And neither, even together has a credit rating that is above zero. Next time they probably will go under but for good. Now that the big players are bailed out courtesty of Bailout Obama (BO), GM/Chrysler are now on their own, for however long they last.
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But, but, but you told us they both would be liquidated in bankruptcy court. You were wrong then and you prediction will most likely be wrong as well. LOL

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One can only hope. Perhaps the ignorant voters who are only too willing to believe unbelievable promises, simply because they sound appealing, will be just a bit wiser. Not to forget the equally ignorant voters who voted for "change" without bothering to understand if change was really possible and what the definition of change really was. This guy proved himself to be a master puppeteer and he clearly knew how to pull the strings on a gullible public. Now - it's payment time.
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-Mike-
snipped-for-privacy@windstream.net
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Once again you are confused. The new GM is STILL selling more vehicles than any other manufacturer with nearly 20% share of the current down US Market, the largest market in the world. Toyota has just under 16% and Ford just over 16%

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Mike wrote:

Mikey, the fount of all bankrupt automotive wisdom
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I have killfiled him again.
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But, but, but then how will you ever learn what is happening here in the real world?

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Well said.
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