The CEO greed just never ceases to amaze me...BOU
Auto Industry Close to Bankruptcy But They Get Pricey Perk
By BRIAN ROSS and JOSEPH RHEE
November 19, 2008ó
The CEOs of the big three automakers flew to the nation's capital yesterday in private luxurious jets to make their case to Washington that the auto industry is running out of cash and needs $25 billion in taxpayer money to avoid bankruptcy.
The CEOs of GM, Ford and Chrysler may have told Congress that they will likely go out of business without a bailout yet that has not stopped them from traveling in style, not even First Class is good enough.
All three CEOs - Rick Wagoner of GM, Alan Mulally of Ford, and Robert Nardelli of Chrysler - exercised their perks Tuesday by flying in corporate jets to DC. Wagoner flew in GM's $36 million luxury aircraft to tell members of Congress that the company is burning through cash, asking for $10-12 billion for GM alone.
"We want to continue the vital role we've played for Americans for the past 100 years, but we can't do it alone," Wagoner told the Senate Banking Committee.
While Wagoner testified, his G4 private jet was parked at Dulles airport. It is just one of a fleet of luxury jets owned by GM that continues to ferry executives around the world despite the company's dire financial straits.
"This is a slap in the face of taxpayers," said Tom Schatz, President of Citizens Against Government Waste. "To come to Washington on a corporate jet, and asking for a hand out is outrageous."
Wagoner's private jet trip to Washington cost his ailing company an estimated $20,000 roundtrip. In comparison, seats on Northwest Airlines flight 2364 from Detroit to Washington were going online for $288 coach and $837 first class.
After the hearing, Wagoner declined to answer questions about his travel.
Ford CEO Mulally's corporate jet is a perk included for both he and his wife as part of his employment contract along with a $28 million salary last year. Mulally actually lives in Seattle, not Detroit. The company jet takes him home and back on weekends.
Plants Closed, Company Jets Stay
Mulally made his case Tuesday before the committee saying he's cut expenses, laid-off workers and closed 17 plants.
"We have also reduced our work force by 51,000 employees in the past three years," Mulally said.
Yet Ford continues to operate a fleet of eight private jets for its executives. Just Tuesday, one jet was taking Ford brass to Los Angeles, another on a trip to Nebraska, and of course Mulally needed to fly to Washington to testify. He did not address questions following the hearing.
"Now's not the time to do that sort of thing," said John McElroy of the television program "Autoline Detroit."
"Now's the time to be humble and show that you're sharing equally in the sacrifice," McElroy said.
GM and Ford say that it is a corporate decision to have their CEOs fly on private jets and that is non-negotiable, even as the companies say they are running out of cash.
Private jet travel is perhaps the greatest perk of all for CEOs, who say it allows them to travel more efficiently and safely, even in a recession.
AIG, despite the $150 billion bailout, still operates a fleet of corporate jets. The company says it has put two out of its seven jets up for sale and is reviewing the use of others. Though there are no such plans by GM or Ford.
"It appears that the senior management of the automakers simply don't get it," said Schatz.
Copyright © 2008 ABC News Internet Ventures
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11-19-2008, 03:30 PM #1
Big Three CEOs Flew Private Jets to Plead for Public Funds
11-19-2008, 03:30 PM #2
Last edited by CALFFBOU; 11-19-2008 at 03:33 PM.
11-19-2008, 03:34 PM #3
That is not greed, that is good use of the CEO's time. The misconception of the use of business jets is unfortunatly deep in this country. If the CEO's had then flown to the Bahamas in those jets, there would be a problem. The Leadership of Congress have access to what is essentually private jets, only even better service. CEO's using these jets for business purposes makes a good news clip, but is a bogus issue.
11-19-2008, 03:50 PM #4
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That's not to say the leadership of our congress is exempt from the same. It seems anyone in a leadership role in either the gov't or the private sector needs a lesson on responsibility.
11-19-2008, 03:56 PM #5
As for Congress, the leadership really should have these assets available due to the potential for crisis that they have to deal with, just like some of our expensive firefighting tools that we drive around that are rarely used, but really needed when they are.
11-19-2008, 04:05 PM #6"...When you walk through the fire, you will not be scorched, Nor will the flame burn you." Isaiah 43:2
11-19-2008, 04:08 PM #7
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With technology such as it is today, they don't need to be in a boardroom, office, factory, or the like to get thier job done. They can do it anywhere, including a first class seat on a commercial air line.
It is poor money management.
As for thier time being so valuable, I ask you this, What do they really do that justifies such huge salaries? As thier companies fail, they succeed. That's just stupid. If you or I fail at our job, we get fired. This is not so in the corporate world. A CEO at a company the size of GM is not actually doing that much, he's like the lead singer of a band. He didn't write the song, he doesn't know how to play an intrument, and he can hardly read the contracts he signs with record companies and promoters, but he sure looks good while he performs.
They don't need this much money to survive well beyond the means of the average person, so why do they get it? Perhaps if some of thier products weren't so expensive, more people could buy them and help get them out of the terrible perdiciment they are in.
11-19-2008, 04:27 PM #8
That first AIG retreat was not for the "big wigs" it was for the sales force. Again bad timing, but not bad business as it had been scheduled months in advanced and was probably mostly paid for in non-refundable deposits.
The corporate planes are not parked for very long, that is the point. When you see it cost $20K for them to fly to DC round trip, that factors in the time that it did sit around.
11-19-2008, 04:37 PM #9
A business can often fly on auto-pilot with a weak or non-engaged CEO, but it can not grow. These are smart go-getter types, they inharited the problems they are dealing with. I know from personal observation that Rick Wagoner is a hands on guy who works his tail off every waking moment. These guys are over-paid, but they are not worthless either.
11-19-2008, 04:43 PM #10
The problem is not that they arrived in private jets. The problem is that many are going to work at $31 and some change per hour in the jobs bank to sit and wait for something to do. The problem is that health insurance for retirees is covered 100% by the companies. The UAW and their unrealistic labor contracts got this ball rolling where emphasis had to be placed on sale of the higher priced vehicles to make any kind of profit as opposed to pushing more inexpensive but more efficient vehicles. The Congress should compel the Auto Companies to file Chapter 11, get out from under these contracts, streamline their operations and then if assistance is still necessary float them a loan. Don't throw good money into a system that will continue to bleed red ink with no light at the end of this tunnelTo err is human, To forgive divine and at times I am as much of both as you will ever find
11-19-2008, 05:04 PM #11
The entire industry is flawed
There are problems in the auto industry that have brought them to this position.
Certainly, it's poor judgement to maintain this fleet of jets and to use them when you are asking US, the taxpayer to help you avoid bankruptcy.
As for their valuable time... wanna bet they slept on the flights? I wouldn't take that bet.
Yes, the unions also have some ownership in this problem.
For those reasons, and because I think that the only way to put this disaster back together, I think we need to let them go bankrupt.
They won't disappear, they will restructure and come back. They will come back leaner and more prepared for the future.
To simply give them a loan will only delay this. It's inevitable.I am now a past chief and the views, opinions, and comments are mine and mine alone. I do not speak for any department or in any official capacity. Although, they would be smart to listen to me.
"The last thing I want to do is hurt you. But it's still on the list."
"When tempted to fight fire with fire, remember that the Fire Department usually uses water."
11-19-2008, 05:10 PM #12
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Believe me, I've done my best to help, I've got a pair of those GM gas guzzlers and I wouldn't trade them for anything, I love my vehicles and I don't complain at the pump. I have to imagine that if the automakers were healthier there would be a lot more opportunity to buy interesting vehicles at reasonable prices. I think his would return them to a level of stability. Maybe that's a fairy tale though.
11-19-2008, 06:05 PM #13
11-19-2008, 08:26 PM #14
Not sure if it is true, but the radio station I listened to on the way home was saying that one of the Ford or GM big wigs left Boeing, works for them for $28,000,000 per year and gets the corporate jet to fly him home to Seattle every weekend.
I say f@ck 'em. Make a good product and I'll buy it. Until then, you screwed me on 1 Chrysler, 1 Ford, and 3 GMs. I'll my 4Runner and Subaru (maybe trade it in on a Tacoma) and IF you survive your own financial ineptitude and actually make a decent product I MIGHT move back to you. Until then, keep making shyte and you get none of my money."Too many people spend money they haven't earned, to buy things they don't want, to impress people they don't like." Will Rogers
The borrower is slave to the lender. Proverbs 22:7 - Debt free since 10/5/2009.
"No man's life, liberty, or property are safe while the legislature is in session." - New York Judge Gideon Tucker
"As Americans we must always remember that we all have a common enemy, an enemy that is dangerous, powerful and relentless. I refer, of course, to the federal government." - Dave Barry
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11-19-2008, 08:37 PM #15
Yeah that's it. I rode the short bus so I don't understand all these deep thoughts Mr. Jack Handy. The fat cats aren't at all wasteful. In fact now I feel sorry for them. We should give them the $25 billion plus a bonus for their suffering.
What I do know is this. Corporate America is fundamentally flawed and deeply corrupt.
Non refundable deposits. What a load of crap."...When you walk through the fire, you will not be scorched, Nor will the flame burn you." Isaiah 43:2
11-19-2008, 08:53 PM #16
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I'm sure $28 million is a gross income figure... but c'mon. I'd feel like I was balling out of control if I made $280k per year.
11-19-2008, 08:58 PM #17
"Ford CEO Mulally's corporate jet is a perk included for both he and his wife as part of his employment contract along with a $28 million salary last year. Mulally actually lives in Seattle, not Detroit. The company jet takes him home and back on weekends.""...When you walk through the fire, you will not be scorched, Nor will the flame burn you." Isaiah 43:2
11-19-2008, 09:07 PM #18
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How about they git rid of the robots and give jobs back to humans.
And stop out sourcing to other countries. Then maybe we would have more people that could afford to by these products.
Robots are great but they dont spend money to keep the economy going.
And yes the CEOs are over paid
11-19-2008, 09:41 PM #19
Yes CEO's are overpaid.
Robots do not spend money. They also do not make the same errors that human workers do. The Detroit plants automated to do a more efficient job at a lower operating cost. The problem came in with the farce that is the jobs bank. You can't fire anyone, but you must pay them about $31.80 / hour to play cards, smoke cigarettes and wait to be called to the plant floor.
Where is the logic in that? Cut out the outrageous executive pay, Get rid of the jobs bank, if retiree insurance is that important make the union foot the bill, and if there's anything else there that is totally stupid make it go away. Then and only then allow these idiots to the Government tit to suck for a bit.To err is human, To forgive divine and at times I am as much of both as you will ever find
11-20-2008, 03:41 AM #20
Nothing succeeds like excess.
One can't help but be amused at how quickly the titans of industry become socialists.
Last edited by scfire86; 11-20-2008 at 04:29 AM.Politics is like driving. To go forward select "D", to go backward select "R."
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