Feel the Burn
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TTAC commentator Corky Boyd offers a timely analysis:?The administration has loaned or agreed to loan a total of $65 billion to GM and Chrysler in exchange for 60 percent ownership of GM and an 8 percent stake in Chrysler.?
If the two produce 3.5 million vehicles for the year (and that?s on the high side), that?s over $17,000 per vehicle of subsidy. And that doesn?t include the $15 billion loan to GM the government forgave in the bankruptcy and the infusion Chrysler will need before the end of the year.
Last year brought the use of a new term in finance, ?Cash Burn.? I guess it?s a take off on the aviation term of fuel burn. It?s a very casual term for billions of taxpayer dollars that have to be used to make up the ?burn.?