In case you didn’t catch the Saturday Night Live Spoof of the Senate Hearings on the bailout of the Big Three US Automakers.
In case you haven’t been keeping up with the Big 3 Automakers request for $25 billion in Bail Out you should probably read these post:
I must be doing something right… Two post in one week merited action from the powers in Washington and Detroit. I really can’t take full credit or even a small portion. The credit really goes to the people of Detroit like MaureenFrancis of Oakland County Real Easte Firm SKBK Sotheby’s International holding Corporate Executives accountable like in the latest attempt by GM to save the public image of their Company as they ask for money from US Tax Payer’s.
In the end the Big 3 US Automakers will get assistance and I hope they do. I just want to make sure it is used correctly and not to line the pockets of the wealthy.
MSNBC.com and Reuters is reporting that GM is Returning 2 Leased Jets from their corporate fleet.
GM to return two leased jets amid criticism
By Poornima Gupta
DETROIT (Reuters) – General Motors Corp will return two of its leased corporate jets amid intense criticism in Washington this week on the luxury travel arrangements of its chief executive even as the company pleads for federal aid.
CEO Rick Wagoner was in the capital to testify on the company’s dire financial situation but his testimony was overshadowed by irate lawmakers who blasted him for flying on a private jet to ask for public funds and failing to make personal sacrifices in exchange for federal assistance.
Chief executives from Ford Motor Co, and Chrysler LLC, who were also there to plead for $25 billion in federal aid, came under fire too for flying to Washington in private jets.
GM spokesman Tom Wilkinson said on Friday GM decided to return the aircraft because of a “really aggressive cutback in travel.”
The company, which is in a cost-cutting mode, is scrutinizing every trip, he said, but declined to disclose the name of the company it leases the airplanes from.
Wilkinson said the decision to return the leased corporate jets was made before this week’s hearings and that the company in September returned two other of the seven jets it had at the beginning of the year.
“There is a perception issue,” Wilkinson said of Wagoner’s travel to Washington on a private jet. “We need to be very sensitive to that going forward.”
He, however, said the company has not decided on what mode of transportation Wagoner would take if had to travel to Washington again.
Wagoner and Ford CEO Alan Mulally are required by their companies to fly by private aircraft for security reasons, according to company documents filed with the U.S. Securities and Exchange Commission.
The policy for Chrysler CEO Robert Nardelli is not required to be disclosed because the company is not publicly traded.
Skeptical lawmakers took to task the three CEOs for their luxurious travel arrangements at congressional committee hearings.
“Couldn’t you have downgraded to first class or something, or jet-pooled or something to get here?” Rep. Gary Ackerman, a New York Democrat, asked the executives at a hearing held by the U.S. House Financial Services Committee.
Even Democrats who said they were sympathetic to the automakers’ plight expressed frustration that the executives used private jets while professing ruthless cost-cutting measures.
A Chrysler spokesman said the automaker also leases or charters jets. He, however, declined to comment on whether the company was rethinking the use of private jets for executive travel, saying it was a “private matter.”
Ford did not have an immediate comment on its corporate jet policy.
According to Ford’s proxy, CEO Mulally’s compensation included $752,203 in 2007 for personal use of company aircraft.
About two years ago, the head of Ford’s North American operations, Mark Fields, gave up use of a corporate jet for personal travel to his home in Florida after the arrangement came under criticism at a time when the automaker was losing billions and slashing jobs.
He now flies first class on commercial planes.
(Additional reporting by David Bailey, editing by Dave Zimmerman)
Today on Capital Hill the Big Three Automakers were grilled about their business practices. Apparently the Senator from Massachusetts heard my trimming the fat suggestion at the end of my last Big Three Post. But in the latest round of American Companies needing government funds the Auto Executives were grilled by a Senator from MA about their corporate jet usage. Read about it on ABC News.
Big Three CEOs Flew Private Jets to Plead for Public Funds
Auto Industry Close to Bankruptcy But They Get Pricey Perk
By BRIAN ROSS and JOSEPH RHEE
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.
Gas prices have dropped for 60 days straight. Gas prices have dropped 60% since Summers high. Gas prices near my house are $2.00-2.10. The high gas price I remember from this summer was over $4.00 which means that gas prices should drop to around $1.60. I never thought we would see prices this low again. Oil prices demonstrate and codify negative circumstances – it is nice to see – since gas prices effect more people directly than does much of Wall-Street’s short comings.
Read the CNN.com/Money.com article referencing the low gas prices.
Gas price drop: 60 days straight
National average price for gallon of gasoline falls to $2.105. Peak was $4.114 in July.
Remember $4 gas? Soon it will be $2 gas.
As the nation’s economy worsens, the demand for oil and gas wanes. As a result, prices drop. And drop. And drop.
The price of gas fell overnight Sunday for the 60th consecutive day.
The national average price for a gallon of regular gasoline fell 2 cents to $2.105 a gallon, according to a survey released Sunday by the American Automobile Association.
A gallon of gas has dropped nearly in half since hitting an all-time high of $4.114 on July 17. It’s been nearly two years since prices were this low, according to AAA figures.
At the high end, drivers in two states are paying an average of $3 or more: Alaska, at $3.181 a gallon, and Hawaii, at $3.049.
But there are now 16 states where the average price has fallen below $2. Missouri had the cheapest gas in the nation, at $1.816 a gallon.
The rapid decline in gas prices comes as the price of crude oil continues to collapse. Crude prices, which make up roughly half of gasoline prices, have fallen more than 60% since hitting a record $147.27 a barrel on July 11.
Crude for December delivery fell $1.20 to settle at $57.04 a barrel on Friday.