...warenee THE GRAND DETROIT BANKRUPTCY Frank Borman, a US Astronaut and later a CEO of an airline company in mid seventies, once commented that “Capitalism without bankruptcy is like Christianity without hell.” This fine observation pointing towards lacunae in the capitalist regime has several underpinning examples in the past and now includes the bankruptcy proceedings of Detroit. Once, a booming hub for automotive manufacturing, a prime location as a transportation route along the Great lakes and a center for technological innovation, the city of Detroit has endured devastating economic changes. The city is under a debt of $18.5 billion. Its population is now half of what it was in the 1950s, as majority of the working population has been forced to leave the city primarily due to lack of employment, among other issues. At the beginning of this year, Detroit’s official unemployment rate was 18 percent, more than twice the national average. Is It The First Time? In India, laws are not clear even for firms to file for bankruptcy; however, in the US even a city can do so. In fact, this is not the first time a city has filed for Chapter 9 bankruptcy in a US court. The thing that makes it very different is its magnitude; prior to Detroit’s $18.5 billion, Jefferson County held the record with its $4 billion bankruptcy filing. Closer inspection suggests that there are other differences besides the magnitude of the disaster. While Jefferson County accumulated $3.14 billion in sewer debt...
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...customers and dealers. The company has approximately 326,000 employees. (referencebusiness.com) General Motors is one of the world's largest auto manufactures. . It was the world’s largest car maker from 1931 to 2008, when it was surpassed by Toyota (newyorktimes.com). The company was founded in 1908, and today manufactures cars and truck domestically and internationally. For most of the 20th century, General Motors was the biggest company in the industry worldwide. It not only led in automotive innovations, but it helped to define the new bureaucratic multinational corporations that shaped the post-war economy. Chrysler Chrysler LLC, for years America's third-biggest automaker, is a U.S. automobile manufacturer headquartered in the Detroit suburb of Auburn Hills, Michigan. Chrysler was first organized as the Chrysler Corporation in 1925. Chrysler and its subsidiaries were part of the German based DaimlerChrysler AG due to a merger in November 1998 (http://en.wikipedia.org/wiki/Chrysler). The Chrysler brand includes Mercedes-Benz, Freightliner, Sterling, Setra, and Western Star...
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...Executive Summary: Ford Motor Company was incorporated June 16, 1903 by Mr. Henry Ford with only $28,000 in capital. Ford Motor Company drew quick success and gained a clear advantage over future competitors with the ability to produce an affordable, efficient and reliable automobile for everyone (scope). In pursuit of efficiency and lowering costs, Ford in 1913 introduced the moving assembly line into his plants, a revolutionary idea that would change the automobile industry because of its ability to increase its production. Two other American made automobile manufactures’, known as, Chrysler and General Motors moved into Ford’s Detroit neighborhood wanting to share the profits of this new innovation. Together, they would be called Detroit’s “Big Three” and all three equally responsible for the industrialization and progression of Detroit, Michigan....
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...perhaps hold true. However, when it is juxtaposed with makeshift homes made of tents and a couple of personal belongings, this promise seems nothing but shallow. There are many homeless individuals, and now a growing number of families, living on our streets, and their future is bleak. This is a terrible reflection of a country that has so great to offer so something must be done to try to solve this issue. In Detroit, through services like transition homes and shelters, Detroit Rescue Missions Ministries, though not perfect, is doing an efficient job dealing with homelessness. To understand the impact Detroit Rescue Missions Ministries (DRMM) has had, it is important to understand homelessness and its causes. There are “643,067 people experiencing homelessness on any given night” in this country and 37% are families (End Homelessness). Homelessness is caused by poverty and the inability to afford housing. The U.S. Department of Housing and Urban Development (HUD) “calculates that a family with one full-time, minimum-wage worker can't afford a two-bedroom apartment anywhere in the country” (Katel). Poverty is another issue, especially in Detroit. Due to the foreclosure crisis and high unemployment rate “first-time homeless citizens are flocking…to near-capacity shelters” (Oosting). CEO of DRMM, Chad Audi, says there has been a wave of people who would never have thought they would be jobless let alone homeless, coming to the shelter. "What we are seeing now is more and more of...
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...understand the internal and external factors that impact businesses. Even though the family’s business has alway been different and had little competition since the close of their small business in Detroit, the Overton family has had great pie. Yet, it was the relentless work ethic and the open mind to new technology that allows The Cheesecake Factory Inc. to currently have 151 restaurants under their name; not to mention being the United States distributor of cheesecakes. The way Evelyn, Oscar, and later their son, David, used the S.W.O.T analysis to build the American dream was difficult at times, but the Overton family made it look easy as a cheesecake pie. The moral and work ethic of Evelyn and Oscar was the backbone of this successful company, along with a warm, casual dining experience, and great menu options. In a free market you want to make your business and product different so that you can have an advantage; Evelyn’s recipe was this advantage. The Cheesecake Factory Inc. began in Los Angeles during 1972, where the elderly couple worked long hours and to build a solid reputation and clientele. Capitalism allows for free competition in the free market so the Overtons capitalized on the weaknesses of moving to a new area by, utilizing strengths founded in Detroit. Great products, the willingness to deliver, and support of local farmers, who provided good ole word of mouth advertising; yet having a new age approach to technology, also...
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...The Impact of a Professional Sports Team on a City Craig Keller Microeconomics 12-2 T -T All major cities in the U.S. have one thing in common with each other; they all have professional sports teams. From New York to Los Angeles, from Seattle to Miami all have professional teams. They all have the devoted fans no matter if they win the championship or they finish last. But having a major sports team in a city is more than just having someone to cheer for. A sports team can and often does a benefit on the city they are in. They benefit the city’s economy in various ways. Oklahoma City is a city that is considered a small market. The city has had sports teams before, an AAA baseball team, and a minor league hockey team, but never a major league team. Oklahoma City is currently the largest city in Oklahoma. In land area, it is the 3rd largest in the nation behind Anchorage and Jacksonville. (Knapp, 2009) Oklahoma City estimated population is 537,734 as of 2006. ( U.S. Census Bureau, 2010) In 2008 the city finally got a professional sports team. The NBA team the Seattle Supersonics moved from Seattle to Oklahoma City and became known as the Oklahoma City Thunder. The move was possible because the city of Oklahoma had been trying for some time to get a professional team. To do this the city came up with what is called the Metropolitan Area Projects (MAPS), which financed new and upgraded sports, entertainment, cultural and convention facilities primarily in the downtown...
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...businesses. When the economy experiences a downturn, consumers spend less and seek more for the money they do choose to spend; this puts companies in a unique situation. Many companies must choose between increasing prices and letting employees go in order to keep themselves in business. The United States recession of 2008 put employers in the same situation; in fact, this recession put employers in an even more difficult position. The recession saw a decrease in employment of over 6 percent—double that of all previous postwar recessions (Auguste, Lund, & Manyika, 2011). The retail sector lost 1 million jobs during the most recent economic recession. Since then the industry has added over 90,000 jobs, but this still results in job losses offsetting job gains due to this rough economic time (McCall, 2011). Wal-Mart, like any other retail business, feels the effects of recent economic trends. Unfortunately, Wal-Mart has had to resort to eliminating health insurance coverage for part-time employees and increasing premiums for other workers in an effort to cut costs (Wright, 2011). This strategy, though unfortunate, allowed the company to cut costs during the recession without eliminating positions or increasing prices. Wal-Mart also implemented strategies to increase profits even before the economic downturn. In 2005, the company implemented a plan to target wealthier consumers—outside of their normal blue collar clientele—with a more modern marketing campaign...
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...holding a box of Twinkies. When he was offered the sweet treat, his face lights up and the music begins to play again. Additionally, the narrator comes on to say “Chevy Silverado, from the beginning of your work day to the end of the world, Chevy runs deep.” The advertisement appeals more to the male population, alluding to the idea that the truck is indestructible, therefore, so will you be if you drive a Chevy Silverado. On the other hand, Chryslers ad campaign titled half-time in America wrote by David Gordon Green (poet) and directed by Matthew Dickman produced this touching presentation by using the metaphor, “halftime in America” The ad clearly depicts the fight to revive the American economy with a specific focus on the decline in Detroit and the automotive industry. This two-minute piece starts when Clint Eastwood begins to speak, “It’s halftime. Both teams are in their locker room discussing what they can do to win this game in the second half.” The dark silhouette of the man walks through a dimly lit...
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...Add hard work and conviction and a know how that runs generations deep in every last one of us.” A few glimpses of the Chrysler 200, along with brisk scenes of downtown Detroit. In the background, Oscar-winning Eminem’s song “Lose Yourself” begins to play. Continuing, “That's who we are, that's our story. No, it’s probably not the one you have been reading in the papers. The one being written by folks who have never even been here, who don't know what we’re capable of.” Next shown, are beautiful homes, a figure skater doing amazing tricks along with an entire football team training in the midst of a snow storm. In addition, the speech goes on “Because when it comes to luxury it’s as much of where it’s from as who it’s for. Now we're from America but this isn't New York City, or the Windy City, or Sin City, and we're certainly no one’s Emerald City.” Again, a brief side, rear and front glimpses of a shiny black Chrysler appears, accompanied with quick peeks of Eminem. Then, slightly over one-minute into the clip, enters Grammy- winning and Michigan native Eminem. Where he exits the car, and enters a building with a large and brightly lit sign that reads “Keep Detroit Beautiful.” The ad reaches an emotional peak, as Eminem walks down the center isle where an all- black choir halts in the middle of rehearsing. This is the Motor City,” says Eminem, standing on the stage of downtown Detroit's Fox Theatre. Then...
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...Labor (2010). In the evolution of gender roles, women account for more than half of the labor force, earn a majority of their families' income, and still contribute more around the home than their husbands. For families with children, a new economic reality is further influencing an already-growing trend, which is women asserting the role as primary breadwinners while husbands adopt the role of primary caregivers. "Some 140,000 married men acted as their family's primary caregivers last year [2008], up from 98,000 in 2003." (Gomstyn, 2012). As previously stated, women account for more than half of the American workforce, and “the last time that the economic climate moved such large numbers of women into primary breadwinner roles was the Great Depression” (Coontz, 2010). Nevertheless, even with such dramatic changes in the labor force, women on average make about 78 cents for each dollar earned by men-- according to the most recent U.S. Census data; making it increasingly difficult for women to successfully subsidize the income of their once breadwinning husbands. In a “Ask a Working Woman Survey Report”, women were asked what proportion of their family’s income they personally earned- all or almost all, more than half, about half, less than half,...
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...CASE ASSIGNMENT: Ford Motor Co. 1. One Ford; One Big Turnaround In 2006, as the United States was nearing one of the worst economic recessions in its history, Ford Motor Co. was best known for big brawny pickups, gas-guzzling SUVs, and the all-American Mustang. That year, Ford posted a $12.6 billion loss. In 2007, it posted a $2.7 billion loss, and U.S. and global economies dove into a three-year recession. During that recession, Ford’s major U.S. competitors (General Motors and Chrysler) suffered such losses that the U.S government gave them massive bailout loans and both companies filed for bankruptcy. Ford, however, executed a series of key strategic maneuvers, asset divestitures, cost-cutting initiatives, and layoffs to weather the storm without bailouts. The result is a very different company and brand. A major part of Ford’s strategy involved significant changes in the products it had to offer. For years all the Detroit automakers had largely ignored the market for small cars, but the oil shock of 2008, increased regulatory pressure, and changing consumer demand made it clear that the focus had to change. Understanding the shift in consumer demand when he became CEO in 2006, Alan Mullaly started a massive consolidation of Ford’s product lines. One of Mullaly’s goals was to have a stable of products clearly defined for each market segment around the world—small, medium, and large cars, utilities, and trucks. Mullaly set a goal for Ford: reduce the existing 97 nameplates...
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...Environmental Challenges of the American Automotive Industry Post economic recession has seen a return of the American automobile manufacturers (most specifically the Big 3, though Chrysler was bought by Fiat). Still environmental challenges to American automobile manufacturers are many: global competition occurring here and abroad; reduced demand; product safety recalls; environmental/emissions regulations; and fluctuations in the economy. All of these challenges have an impact on every American automobile manufacturer as well as global automakers, just to differing degrees. The environmental challenges also impact the consumer. This essay will discuss those challenges and how they can challenge the American automobile manufacturing industry...
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...Throughout Reagan’s campaign he assaulted the Carter administration’s free-spending (Moss & Thomas, 2013, pp-208-210). He made promises to cut spending, but ultimately spent more. The most common misconception is that Reagan saved our economy with his famous Reaganomics. This of course included the modern trickle-down theory or supply-side economics, which included major tax decreases, specifically on the wealthy. These tax decreases, coupled with high military spending, created a massive debt and led the country into one of the worst depressions since the Great Depression. When Reagan entered the presidency in 1981 the national debt was at $900 billion. By the time he left it had over tripled to $2.8 trillion. To top it off, many of the military projects the money was used to create went unused or incomplete. One project that was deserted was the Star Wars program. Skyrocketing debt was not the only problem. With recession obviously came unemployment. After the Reaganomics policies were put into place unemployment steadily and quickly grew until it peaked at 11%, one of the highest unemployment rates on record (Newport, Jones, & Saad, 2004). Also hit by...
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...rates, real GDP, automotive sales and inflation and unemployment are some of the most compelling instruments that can be used to assess the state of the automotive industry. Business Cycles The U.S automotive industry saw a steady expansion from its inception until 1978 in which where production reached its all-time peak. The industry showed a small contraction and a quick recovery leading to its peak between 1972 and 1976. In the early 1980 there was a big drop in production units and the industry fell into its first true recession. The industry recovered in the mid 80s peaking in 1988, but never reached its previous high before falling into another recession that lasted from 1990 to 1992 (Smith, 1996). The automotive industry’s production rates have been cycling through different business phases throughout history. In 1999 the automotive industry finally recovered and reached its previous high. Now the automotive industry is again experiencing a recession. Traditionally, during times of expansion the inflation in the economy is...
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...FORD MOTORS * Background Ford motor company is an American multinational automaker; headquarter in Dearborn, Michigan, basically in Detroit. Founded by Henry Ford in the year 1903, company products are automobiles; the commercial ones are fords name and the luxury ones under Lincoln, both brands under the same company. Ford Company have participation in the market share stock of New York, also has contribution over Mazda and Aston Martin, Japan and UK respectively. Being the second largest automaker enterprise in the US and the fifth in the globe, Ford has global revenues of $118.3 billion, by the year 2008. Manufacturing 5.532 million vehicles and manage over 213.000 employees in 90 plants and facilities around the globe. For a certain period Ford manufacture a line of trucks, bus and tractors. The company discontinued from their products within market only focusing in commercial vehicles. Ford manufacturing methods had a huge impact on the culture and the concept of ensemble cars, “Fordism” was the popular name for those techniques, an industrial workforce using elaborately engineered manufacturing sequences classified by moving assembly lines, was basically the concept of Fordism, know by the year 1914 worldwide. Ford used to be the manager of Mercury luxury brand for the US market, the company discontinued form market in the year 2011. Ford also acquired some subsidiaries over the years, like Jaguar and Land Rover for example, before being sold to Tata motors...
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