Auto Dealers Push for a Big 3 Bailout to Save New Hampshire Jobs

The talks in Washington may be on hold between Congress and Big Three officials.

Lawmakers sent the auto executives home to come up with a plan for solving their economic problems.

Nevertheless, the president of New Hampshire’s Automotive Dealers Association wants the bailout of the industry to proceed.

Peter McNamara says many jobs could be lost if lawmakers let the manufacturers go out of business.

In nh there’s 87 gm, ford and Chrysler dealers and with all the New Hampshire Auto Dealers Association there’s 13,000 employees in the state. And those are just direct jobs that would be affected.

There are also eight other corporations operating in the state that supply Detroit’s car makers.

Thermopol, a division of Continential Contitech, operates a factory in Somersworth.

About 80 employees there manufacture car and truck high pressure hoses.

President Ed Cotter says the economic downturn has already led him to eliminate the factory’s third shift.

He says a big three shutdown would likely eliminate even more jobs.

For us, we’re relatively small at this point. We’ve done our cuts but probably about 25 % of our workforce which would be right about 35 or 40 employees would be affected if a bankruptcy did occur and operations did cease.

Other corporations that supply GM, Ford and Chrysler have also shed jobs.

Freudenberg NOK supplies the Big 3 with sealants and O rings.

In 2006, the company employed about 1500 people in the state.

That number is down to around 1000 workers now.

Vice president Sarah O’Hare says the company is better positioned now than it was two years ago to withstand the slowdown in the domestic auto industry.

The good news for Freudenberg NOK and those employees that work with us is that we’re about 50 percent automotive and 50 percent disconnected from that industry.

Freudenberg and other suppliers have branched out to additional industries to try and avoid sales drops when the auto industry slumps.

But she says that doesn’t rule out more job cuts.

In the meantime, New Hampshire lawmakers in Congress say they’re quite satisfied that the Senate suspended talks with the Big 3.

Second District Congressman Paul Hodes says the Big 3 have a chance to make a better impression when they come back before Congress sometime next month.

So I think the auto companies are going to need to be forthcoming and accept that reality has changed. If they want 25 billion of taxpayer money, they better come up with a very aggressive plan to restructure and reform. And if the right conditions are met we’ll take obviously a serious look at helping the auto companies.

Senator Judd Gregg has listened to the automaker’s requests, and says he isn’t sure a federal bailout is the right thing to do.

He asks what will stop other businesses from requesting the same treatment Detroit wants.

Senator Gregg says it might be better to just let the automakers declare bankruptcy, as have many other corporations.

A lot of major companies in this country have gone through chapter 11, the most obvious being the airline industry, US Air for example, a lot the major airlines have gone through a chapter 11 experience. It has not stopped the company from functioning, it has simply caused the company to be reorganized in a way that made it more efficient and made it more competitive.

In bankruptcy, the companies could restructure debt and labor contracts, and borrow money at market rates to make new cars and trucks.

But the heads of GM, Ford and Chrysler have resisted taking that step, saying such a move would result in certain death.

They argue that few people will want to buy a car from a bankrupt company.

The automakers will get another chance to convince lawmakers to go through with the bailout.

They’re expected to come before Congress in early December.