With the Detroit bailout now a wreck, the refrain from the impacted carmakers is that a the money is still necessary, because “consumers won’t buy cars from companies in bankruptcy.”
But they readily flew bankrupt airlines. For years. Still do.
Since 2000, most of the major airlines have traveled in and out of bankruptcy: United, US Airways, Delta, Northwest. Continental was a visionary in this regard, throwing up its corporate hands in 1990. Frontier is still in hock.
You’d think it would have had an impact on traveler willingness to step onto planes, right? Talk about all the questions bankruptcy might raise about the safety and reliability of airline performance. Airline branding wastes milions promoting routes and generic benefits of vacation happiness, but none of it would be tolerated (let alone work) unless would-be passengers felt safe.
And they did. And they do. So why wouldn’t people buy cars from automakers in bankruptcy?
Is it the financial nut? A car is far more expensive than an airplane ticket. But you’d think the value of one’s life was far greater than any car purchase. Yet the airline brands didn’t have any issues with getting paid. And what car buyer has any idea what they’re paying anyway (monthly payments, whether for purchase or lease, are intended to obfuscate the total cost)?
Is it potential service? Again, the carmakers aren’t responsible for service, per se, and there’s no reason to believe that there wouldn’t be available support for any and all vehicle models on the road.
No, it’s just that the argument is false.
Now, I know that the bailout nonsense has been unfair to the car companies, especially after financial firms got zillions with no strings attached. The supposed principled opposition from the GOP has come mostly from senators who have their own pet carmaker factories in their state backyards, who are hoping to do deadly damage to the Detroit competition (and are getting help in their home countries, too). Shame on them all.
But if people are willing to risk their lives flying on bankrupt airlines, I bet they’d buy cars from bankrupt automakers. Don’t the proponents of the bailout need a better argument?