LOS ANGELES – The $25 billion loan approved by the federal government to provide low-interest loans so auto makers can retool plants has piqued the interest ofMotor Co. Ltd. but not rival Motor Corp.
CEO Carlos Ghosn indicated a willingness by the No.3 Japanese auto maker to take advantage of such loans.
“I’m very pleased to see the U.S. government…allow $25 billion to support the efforts of the car manufacturers in the U.S.,” Ghosn says at the Los Angeles auto show.
“Today, if we really want to transform this industry in a way that is radical we are going to need a lot of investment,” he says of a desired move on the part of government and auto makers worldwide to a low- or zero-emissions-vehicle business model.
“Independent of who is struggling and who is not struggling – that’s not the issue,” Ghosn says, referencing the difficulties faced by the Detroit Three, which are lobbying Washington for funding separate for the $25 billion in retooling money to stay afloat.
Unless Congress moves to change the rules to apply the aid directly to the Detroit Three, the retooling loan is available to any manufacturer building vehicles in the U.S. for at least 20 years.
Of the transplant manufacturers, Nissan’s Smyrna, TN, plant would qualify under these terms, as would’s Georgetown, KY, plant and its New United Motor Mfg. Inc. joint venture with Corp. in Fremont, CA.
But Toyota Motor Sales U.S.A. Inc.’s Bob Carter, Toyota Div. general manager, says Toyota is “not looking for any federal or government intervention for ourselves.
“We’re fortunate to be in a well-capitalized, fiscally strong position. There’s nothing arrogant about that, it’s just a fact,” Carter tells Ward’s on the sidelines of a Lexus press conference.
Carter, however, is greatly concerned about the impact the demise of one, two or all three Detroit-based manufacturers would have on the industry.
“We’re for anything that stabilizes and makes the auto industry healthy,” he says. “This is not about a couple of OEMs. What the auto industry is to me is it’s really 12-16 million consumers; it’s 20,000 dealers that employ 1.1 million people.”
Citing National Automobile Dealers Assn. statistics, Carter says 20%-25% of the tax revenues taken in by the average local government in the U.S. “is generated off the sales tax of automobiles. The auto industry is important to the local economy in almost every market. That’s the piece I’m not sure is readily understood.”
Also, Carter points out, suppliers are at risk because “nobody’s a supplier for one auto maker. Difficulties for one auto maker are really difficulties for all.”
On that topic, Brian Carolin, senior vice president-sales and marketing for Nissan North America Inc., says he knows Nissan is monitoring key suppliers that have a lot of business with the Detroit Three. He declines to speculate on whether Nissan is planning for the possibility of having to inject cash into its suppliers to keep them afloat should GM,Motor Co. or LLC collapse.
Meanwhile, Carter says Toyota is not interested in pursuing any or all of the assets of the Detroit Three.
“We are not looking at anything. We think we’re well positioned for the future.”