- The Washington Times - Monday, November 13, 2006


Auto industry leaders plan to stress in a White House meeting that they are not seeking any federal bailout, but want support on health care and trade issues that affect large manufacturers.

President Bush will meet today with General Motors Corp. Chairman and Chief Executive Officer Rick Wagoner, Ford Chief Executive Officer Alan Mulally, and Tom LaSorda, President and Chief Executive Officer of DaimlerChrysler AG’s Chrysler Group in a gathering that has been delayed since spring.

Auto industry leaders plan to tell Mr. Bush they do not want a bailout similar to the 1979 measure approved by Congress that helped preserve Chrysler Corp. Instead, they will discuss the spiraling costs manufacturers face on health care, the advantages Japanese automakers have because of a weak yen and their work to develop alternative-fuel vehicles.

“We’re not going into this meeting seeking specific relief for our industry,” said GM spokesman Greg Martin. “We understand that we have to win in the marketplace but there are issues of national importance like health care and trade that affect the competitive balance.”

All three automakers spend more on health care per vehicle than steel, which adds about $1,000 to the cost of a car built by the Big Three. GM, the nation’s largest private provider of health care, spent $5.3 billion on health care last year for 1.1 million employees, retirees and their dependents.

Mr. Wagoner urged Congress last summer to provide a “vigorous and robust” prescription drug market, develop national health information technology and focus on high-cost, catastrophic cases among a small number of patients.

The automakers have also sought support on trade, arguing that Japan’s weakened yen makes imported goods from Japan cheaper. Auto industry officials also noted that China is keeping its currency artificially low against the dollar, making Chinese goods cheaper in the United States.

Sen. Carl Levin, Michigan Democrat, said yesterday the Bush administration needs “to understand — and I hope the Big Three will be blunt and direct with the administration — that their competitors are not companies overseas. Their competitors are countries overseas.”

The companies have faced hardships while Japan’s Toyota Motor Corp. is seeing soaring profits. Toyota reportedly plans to capture 15 percent of the world car market by 2010 in its quest to unseat GM as the world’s largest automaker.

Ford, the nation’s second-biggest automaker, posted a $5.8 billion third-quarter loss — its largest in more than 14 years — while GM reported a loss of $91 million in the third quarter, a sign of improvement after posting a $1.6 billion loss during the like period last year.

Chrysler Group reported a $1.5 billion third-quarter loss, but it was helped by profits at its parent company DaimlerChrysler.

GM and Ford are both engaged in large downsizing plans. GM has persuaded about 35,000 hourly workers to leave the company under early retirement or buyout plans, and Ford has offered buyouts and early retirement packages to all 75,000 U.S. production workers.

Ford hopes to reduce its hourly work force by 25,000 to 30,000 and is expected to shutter 16 plants.

Mr. Bush drew some flak in Michigan when he told the Wall Street Journal in January that automakers need to manufacture “a product that’s relevant.”

White House spokesman Tony Snow said yesterday that Mr. Bush would “express his support for the American auto industry” and “listen to their concerns.”

The meeting was tentatively planned for May when the Big Three executives met with congressional leaders, but it was postponed because of scheduling conflicts.

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