Are The Auto OEM's Like the Steel Industry of 30 Years Ago?

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Macroeconomics

I received an email this afternoon from a friend in the turnaround industry who wanted to know my thoughts on a potential GM bailout. He referenced a surprisingly interesting piece from the New York Times (Don’t get me wrong, it’s not that I don’t think the NY Times puts out interesting content it’s that it doesn’t typically differ much from the center left point of view). Anyhow, the article he referenced was this one. The article discusses the case for allowing GM to go into bankruptcy.

A friend of my husband’s, Doug Smock, whom I have had the pleasure of meeting, penned several good pieces recently on various topics which I have been asked to comment on, but I’ll defer to Doug’s posts. This first piece entitled: “Obama Should Tell Detroit’s CEO’s: No,” could easily have been written by me but alas, Doug who was a reporter for the New York Times, Pittsburgh Post Gazette and most recently editor-in-chief of Purchasing Magazine tells it like it ought to be told.

Doug continues with a second post here, commenting on the US steel industry which he covered in the late 70’s. The lessons are still relevant today. Doug argues that the steel industry came out of its misery by reinventing themselves as more customer centric and innovative, as Nucor showed the world with their scrap mini-mill concept. Prospects are dimming for a Big 3 bailout as team Pelosi and Reid realize there are not enough votes to over-ride a certain Presidential veto. Bush may be a lame duck but at least he’s willing to ignore the quacking.

–Lisa Reisman

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