Some truth at last!
And his plan (and dollars) sound just like what some European country is doing:
http://www.canadiandriver.com/forum/index.php/topic,61484.0.htmlAutomaker bailouts not the answer: Ford Canada CEOLast Updated: Monday, March 9, 2009 | 9:48 PM ET
The Canadian Press
http://www.cbc.ca/money/story/2009/03/09/uaw-ford.htmlThe best way to rescue Canada's battered auto sector is not through direct bail outs, but by giving consumers an incentive to buy new cars, the head of Ford Motor Co. in Canada says.
"What we need to do is provide an anchor in the sea and right now there is no anchor in the sea for our ship," Ford Canada chief executive David Mondragon told a parliamentary subcommittee meeting Monday night.
"There are great opportunities for governments to help the industry and the economy find the bottom."
Furthermore, Mondragon said, auto sales in Canada will likely fall 13 per cent — or 250,000 fewer vehicles — this year from 2008, which will result in $20 billion in lost sales and $3 billion in lost taxes for governments. He added it could be far worse if Canadian sales drop as far as those that have occurred in the U.S. so far.
The recommendation highlighted testimony at the meeting that brought together representatives from the auto companies, workers and other industry interests in a search for solutions to the crisis in the auto sector.
All agreed that the industry is facing a bumpy year this year that without help could turn into a catastrophe, both for the automakers and the Canadian economy as a whole.
Vehicle sales plummetMondragon said a major reason sales have plummeted in Canada is because consumers can't get credit and because Ottawa's scrappage program is woefully inadequate.
The government's $12-billion credit facility, introduced in the budget to boost lease activity, is insufficient given than Canadians annually borrow about $60 billion to buy autos and trucks, Mondragon said.
But he was especially critical of Ottawa's miserly $300 scrappage program for older vehicles, which he said is so puny no one is using it.
The Ford executive recommended the incentive be boosted to $3,500 for anyone who scraps their 10-year or older jalopy for a new vehicle, a measure he said could spur 100,000 additional car sales this year.
There are about six million vehicles 11 years and older currently in use in Canada, and Mondragon said getting them off the road would be good for the environment since they cause 12- to 18-times as much pollution as newer vehicles.
Ford is the only auto maker of the so-called Detroit Big Three to have so far eschewed government bail-out money. General Motors and Chrysler have asked for about $10 billion from Ottawa and the Ontario government.
Ford strikes deal with union in U.S.Earlier on Monday, the United Auto Workers union in the U.S. said its members working for Ford approved contract changes that include freezing wages and cutting other benefits in a move aimed at helping the automaker remain competitive.
The approved agreement also ends the jobs bank program and lets Ford make payments in stock to a union-run trust for retiree health care.
The union said 59 per cent of production workers and 58 per cent of skilled-trades workers voted for the agreement.
Ford is the first U.S. automaker to come to an agreement with the union.
Over the weekend, GM Canada and members of the Canadian Auto Workers union reached a tentative deal that will be voted on by 10,000 workers in Ontario on Tuesday and Wednesday.
