DTN News - FINANCIAL CRISIS: Bankrupt Detroit Cannot Wait For Federal Cavalry-City Manager

DTN News - FINANCIAL CRISIS: Bankrupt Detroit Cannot Wait For Federal Cavalry-City Manager

Source: DTN News - - This article compiled by Roger Smith from reliable sources Reuters

(NSI News Source Info) TORONTO, Canada - July 21, 2013: Detroit must dig itself out of the hole it created and cannot wait to see if the federal government will come to its rescue, the city's emergency manager said on Sunday.

Kevyn Orr, charged with guiding the collapsed Motor City out of the largest municipal bankruptcy in U.S. history, said any outside assistance would be "great" but he is not banking on it.

"Hope is not a strategy from my perspective. I can't plan on the basis of what may or may not happen or what help may or may not come," Orr said on "Fox News Sunday."

"We are not expecting the cavalry to come charging in," he said. "We have to fix it because we dug the hole."

Detroit filed for bankruptcy on Thursday, setting the stage for a costly court battle with creditors and opening a new chapter in the long struggle to revive the cradle of America's auto industry.

If approved by a federal judge, the bankruptcy would force Detroit's thousands of creditors into negotiations with Orr to resolve an estimated $18.5 billion in debt.

Detroit Mayor Dave Bing said he was talking to officials in Washington about what they could do to help.

"I'm not sure exactly what to ask for. I mean, money is going (to) help, no doubt about that, but how much?" Bing said on ABC's "This Week."

The mayor has had no executive authority since Orr's appointment as emergency manager in March.

Michigan Governor Rick Snyder told CBS' "Face the Nation" the city's problems had been 60 years in the making and he saw no prospect of a federal or state bailout.

Detroit has been hit hard by the move away from industrial manufacturing in America since the 1950s, its problems compounded by chronic mismanagement and a dwindling population. Retirees now far outnumber active workers among the city's 700,000 residents, and unfunded pension liabilities are a key source of its problems.

After the economic collapse of 2008, Washington injected billions of dollars into automakers General Motors Co and Chrysler as the first step of a quick bankruptcy process. But the federal government made no promises this time.

Vice President Joe Biden said on Friday said it was unclear whether Washington could help.

Steven Rattner, who led the auto industry restructuring in 2009, said it would be a mistake for Michigan and the federal government not to provide funds for the city.

"America is just as much about aiding those less fortunate as it is about personal responsibility. Government does this in so many ways; why shouldn't it help Detroit rebuild itself?" Rattner wrote in an opinion piece Friday in The New York Times.

The bankruptcy led investors to dump the city's municipal bonds on Friday but Orr deflected criticism that it will be hard for investors to lend the city money again.

"The reality is, they are going to look at the credit rating of a rehabilitated city. And if that city is capable, they're going to make rational decisions because they are financial institutions," Orr said on the Fox program.

"After some time, after this little kerfuffle, we'll be back in business."

*Link for This article compiled by Roger Smith from reliable sources Reuters
*Speaking Image - Creation of DTN News ~ Defense Technology News 
*Photograph: IPF (International Pool of Friends) + DTN News / otherwise source stated
*This article is being posted from Toronto, Canada By DTN News ~ Defense-Technology News Contact:dtnnews@ymail.com 
©COPYRIGHT (C) DTN NEWS DEFENSE-TECHNOLOGY NEWS

DTN News: China Buys All-American Hummer For $150 million

DTN News: China Buys All-American Hummer For $150 million

*Source: DTN News / Int'l Media (NSI News Source Info) WASHINGTON, DC - October 11, 2009: Nothing was more American than the Hummer. It was Schwarzenegger, cigars and swagger, laughing in the face of scornful environmentalists. Only now the Chinese are laughing.

General Motors Co., seeking to shed brands after emerging from bankruptcy, is nearing an agreement to sell its Hummer sport-utility vehicle business to China’s Sichuan Tengzhong Heavy Industrial Machinery Co. for about $150 million, said three people familiar with the deal. General Motors sold the military-inspired off-road brand to China's Sichuan Tengzhong Heavy Industrial Machinery Co. for a reported $150 million on Friday, consummating a deal announced in early June.

Tengzhong, a sprawling conglomerate with no car-building experience, will own 80 percent of the company. Hong Kong investor Suolang Duoji, who in turn is a major investor in Tengzhong, will own the rest. They will assume existing agreements with Hummer's 160 U.S. dealerships, including two in the Washington area. In its June bankruptcy filing, GM estimated that Hummer was worth $500 million. The deal requires regulatory approval in both Washington and Beijing. GM said it will continue to make the Hummer at least until June 2011, with an option to continue another year. Hummer's management team will stay in place, and company headquarters will be located in the Detroit area. After GM's attempts to sell its Saturn brand failed last week, analysts called the deal a victory for GM despite the low price tag. "It's good news for General Motors, they actually got some money out of it versus having to spend money to wind it down, as they have to do with Saturn," said Michelle Krebs, an analyst with auto information site Edmunds.com. Back in February, while seeking more federal aid, GM said that it would sell or close its Hummer, Saturn and Saab divisions in an effort to succeed as a leaner, more profitable company.

Concern about Hummer's sale to the Chinese was muted. "Yeah, it feels a little weird," said Anthony Cancel, new car sales manager at Moore Cadillac Hummer in Chantilly. "But Americans are still going to build these cars" for a while, Mr. Cancel said. "That's going to employ 3,000 Americans." He noted that even with Hummer's future in doubt, his dealership was still selling 15 of the vehicles a month, down from a peak of 75. GM has not produced the car for six months, he said. "It came at a pretty good time, we only have two left. From the time they turn the factory on it takes four weeks for us to get cars," Mr. Cancel said. Ms. Krebs said the Chinese are following the lead of the Japanese and Koreans, but not by building the cars on their own. "The Chinese are achieving a global presence by acquisition rather than introducing their own brands," she said. "They're buying low right now."

"The Chinese are achieving a global presence by acquisition rather than introducing their own brands," she said. "They're buying low right now." Beijing Automotive Industry Holding Co. has joined a Swedish consortium led by Koenigsegg seeking to complete the purchase of Saab this month. China's Geely Automobile was interested in buying Opel from GM and is bidding to buy Volvo from Ford Motor Co. "It's the same with the Indians, with Tata [Motors] buying Jaguar and Land Rover," Ms. Krebs said. The Financial Times reported this week that Geely's bid for money-losing Volvo was worth $2 billion but that Ford had concerns about protecting its technology. The London newspaper reported that a U.S. consortium led by former Detroit executives has also placed a bid. Independent auto analyst Tom Libby said trade is so interconnected now that Chinese ownership of Hummer is unlikely to diminish its macho appeal. "I have always held that the Hummer brand has value in this market and I consider it a viable competitor to Jeep," he said. The Jeep had its origin in the U.S. military, he said, and still benefits from "sort of a patriotism connection." The Hummer is derived from the Humvee, the U.S. military's successor to the Jeep. California Gov. Arnold Schwarzenegger, a Republican and former action-movie hero, persuaded military contractor AM General to make a civilian version of the Humvee in the early 1990s. AM General of South Bend, Ind., continues to make the military Humvee.

The challenge for Hummer, with fresh capital from Tengzhong, will be to reinvent the brand, which has suffered in recent years from its gas-guzzling image. The company will improve efficiency and performance and branch out to alternative fuels and diesel engines. There's no image problem in China, though. "I think it works for China," Ms. Krebs said. "I have been to China and Hummers are real popular there, even though they are only sold on the gray market. I've seen them on the streets of Shanghai. "They're popular in the Middle East and there are opportunities elsewhere, such as Russia," she said.

DTN News: GM Wants Russians Barred From Opel Takeover ~ Report

DTN News: GM Wants Russians Barred From Opel Takeover ~ Report *Source: DTN News / Int'l Media (NSI News Source Info) BERLIN, Germany - August 30, 2009: US auto giant General Motors wants Russian firms barred from taking over its German subsidiary Opel, but Berlin does not agree, according to the weekly Der Spiegel. The General Motors logo is seen at the General Motors Arlington Assembly Plant in July 2009 in Arlington, Texas. GM wants Russian firms barred from taking over its German subsidiary Opel, but Berlin does not agree, according to the weekly Der Spiegel. In its forthcoming issue the weekly, which cites no sources, says that the US government, which now owns 60 percent of GM, wants no Russian participation in the future control of Opel. Berlin favours Canadian auto parts maker Magna, along with Russian state-owned autobuilder GAZ and lender Sberbank, to take over Opel, which includes Vauxhall in Britain and employs 50,000 people, half of them in Germany. GM's board is thought to prefer rival suitor RHJ International but has so far failed to name a buyer. Government spokesman Ulrich Wilhelm denied the report later Saturday, saying that neither General Motors nor the US government had said that a Russian presence was a reason for turning down Magna's bid. Another government source added that any fears about technology transfer to Russia resulting from the deal could be dealt with in the eventual contract. German Chancellor Angela Merkel said Wednesday that she hoped for progress on the future of Opel "at the latest" before a board meeting of GM on September 8-9. "We believe that it is good and correct that when it comes to the future of GM Europe, of Opel and GM, a decision is made as soon as possible. But substance must come before speed and if there are still issues to be resolved, then we will resolve them," Merkel said in an interview on Sat1/N24 television. A report in the Bild daily said earlier that Berlin had dropped its opposition to GM selling Opel to RHJ, but the Brussels-based investment group would have to team up with a strategic partner in the auto industry. Both Magna and RHJ want to slash around 10,000 jobs at Opel but Merkel and the state governments where Opel has factories prefer Magna because fewer of the cuts would fall in Germany than under RHJ's proposals. Other unconfirmed reports have said that GM might decide to hang on to Opel after all. Der Spiegel said Merkel had promised Russian President Dmitry Medvedev when they met in Munich in July that she would back the Magna bid to the hilt, but it added that the German government had "underestimated the Russian factor," which was "not a detail" for the Americans. "GM is one of the largest players in the Russian automobile market and wants to stay that way," it said, referring to the proposal that under the new management Opels would be produced at the GAZ plant in Russia. "In addition, even 20 years after the end of the Cold War, 'selling off to the Russians' is still perceived by many as a humiliation."

DTN News: Humvee Still Made In America / Humvee Production Will Stay In America

DTN News: Humvee Still Made In America / Humvee Production Will Stay In America

(NSI News Source Info) WASHINGTON - June 5, 2009: The military's High Mobility Multipurpose Wheeled Vehicle, also known as a "HMMWV" or a "Humvee," will continue to be made in the United States, by an American-owned company.

This Humvee prepares for a convoy mission inside the yard at Convoy Support Center Scania, Iraq, April 16. The military's Humvee is manufactured by AM General, an American company in South Bend, Ind. General Motor's decision to sell to a Chinese manufacturer their Hummer brand of vehicles, which shares a common background with the Humvee, will not affect where the Humvee is made.

The recent announcement that Detroit-based General Motors will sell their Hummer brand of vehicles to Chinese-based Sichuan Tengzhong Heavy Industrial Machinery Company, has no bearing on the U.S. military's Humvee.

"The Army's Humvee and the civilian Hummer look similar and share a common appearance," said spokesman Lt. Col. Martin Downie. "But the rights to produce those two different vehicles are no longer owned by the same company."

Humvee manufacturer AM General is an American company based in South Bend, Ind. The company produced the first 55,000 Humvees for the Army in 1985. The company continues today to produce the Humvee for the military.

In the early 1990s, AM General began producing a civilian version of the Humvee, calling it a "Hummer." But by the late 1990s, AM General had sold the Hummer name to General Motors. While GM will sell the Hummer nameplate to Sichuan Tengzhong, the military's Humvee, its designs, unique performance capabilities and technologies will continue to be owned by, and the vehicle produced by, AM General.

US Tells GM To Prepare For Bankruptcy Filing

US Tells GM To Prepare For Bankruptcy Filing

(NSI News Source Info) WASHINGTON - April 13, 2009: The U.S. Treasury Department is directing General Motors to lay the groundwork for a bankruptcy filing by June 1, even though the automaker has publicly stated it could reorganize outside of court, The New York Times reported on Sunday. GM is operating under emergency U.S. government loans. It has been told by the Obama administration's task force overseeing its bailout that it must cut costs and reduce its debts in order to continue to receive aid. The White House-appointed autos task force has given GM 60 days to come up with a restructuring plan and it is trying to determine whether the automaker can be a viable company. Quoting sources who had been briefed on the GM plans, the Times said the goal was to prepare for a fast "surgical" bankruptcy. The newspaper said preparations are aimed at assuring a GM bankruptcy filing is ready if the company is unable to reach agreement with bondholders to exchange roughly $28 billion in debt into equity in GM and with the United Automobile Workers union. A plan under consideration would create a new company that would buy the "good" assets of GM after the carmaker files for bankruptcy, the Times said. Less desirable assets, including unwanted brands, factories and health care obligations, would be left in the old company, which could be liquidated over several years, according to the paper. Treasury officials are examining one potential outcome in which the viable GM enters and exits bankruptcy protection in as little as two weeks, using $5 billion to $7 billion in federal financing, a person briefed on the matter told the Times. The Times sources declined to be identified because they were not authorized to discuss the process. Both GM and Treasury Department officials declined to comment, the newspaper said. Last week, GM's chief executive said the automaker wanted to restructure out of court, but also preparing for a bankruptcy filing.

PUMA News Automobile Technology By Segway Inc. And General Motors Corp.

PUMA News Automobile Technology By Segway Inc. And General Motors Corp.

(NSI News Source Info) April 8, 2009: Mike Gansler, Director of Core Technology with Segway Inc., drives a Personal Urban Mobility and Accessibility, or PUMA, project prototype vehicle in New York's Times Square on Sunday, April 5, 2009.

Segway Inc. and General Motors Corp. announced Tuesday that they are working together to develop the two-wheeled, two-seat electric vehicle designed to be a fast, efficient, inexpensive and clean alternative to traditional cars and trucks in an urban environment.