Detroit Welcomes Bailout With Caution

Congress approved a bailout package for the auto industry last week, offering emergency loans to GM and Chrysler. The cash infusion could save thousands of jobs and bolster Detroit's failing economy. Or it could prove to be too little, too late. Member station WDET's News Director Jerome Vaughn and Cecel Springer, a Chaplain for Chrysler and a member of the UAW Union, react to the bailout.

MICHEL MARTIN, host:

I'm Michel Martin, and this is Tell Me More from NPR News. Coming up, we'll check in with author and purveyor of common sense, Bertice Berry, about how to be a grownup during the holidays. And we'll hear from gospel Diva CeCe Winans. She is spreading the joy with her latest CD.

But first, the latest news about the auto industry. Toyota Motor Corp. reported today it expects to post an operating loss for this fiscal year for the first time since it began reporting such numbers in 1941. It's a sign of the economic slump that has hammered the auto industry worldwide. Last Friday, after weeks of tense negotiations on Capitol Hill, U.S. automakers General Motors and Chrysler finally got the lifeline they were hoping for. The government offered a $17.4 billion cash infusion to buy the automakers some time to try to restructure for the long term.

We wanted to know more about how the bailout news is being received in Detroit, so we've called Jerome Vaughn. He's news director at the Detroit member station WDET. We also hope to hear from Cecel Springer. He's an auto assembly production worker and chaplain for Chrysler. Welcome. Thanks so much for speaking with us.

Mr. CECEL SPRINGER (Chaplain & Auto Assembly Production Worker, Chrylser): Thank you so much for having me. Good morning.

MARTIN: Hello again.

JEROME VAUGHN: Glad to be here with you.

MARTIN: Well, thanks.

VAUGHN: Yes.

MARTIN: So Jerome, let me start with you. What was the reaction when the deal was announced on Friday? Was it relief? Was it, what to you so long?

VAUGHN: I think relief is the first word that comes to mind. People were thinking, OK, we've got time to get it together. I think there was a little bit of anger, as well, about why it took so long, especially when you look at what happened with AIG and the financial industry. You know, those things happened basically overnight but this was really dragged out. So there's a good deal of anger in town as well about it, but mostly relief right now.

MARTIN: Cecel, what about you?

Mr. SPRINGER: Well, we received somewhat of a different reaction on the shop floor amongst many of the workers. True enough, there was some form of relief given the fact that it did take so long for them to reach a decision on this entire issue. But I think largely, many of the workers were a little bit upset over the fact that they're asking for many givebacks and many concessions have to be attached with this particular type of loan, and I think that's where some of the difference in the feeling was coming from on the shop floor.

MARTIN: I know, Cecel, you pull double duty, as I mentioned. You - you are...

Mr. SPRINGER: Yes.

MARTIN: You work on the floor but you're also a chaplain.

Mr. SPRINGER: Yes.

MARTIN: So, without breaking any confidences, what are some of the things that your - that your colleagues are talking to you about?

Mr. SPRINGER: Well, they have a great deal of concern not only for their futures but for the futures of their families. There's a great deal of uncertainty right now amongst this entire industry, and I think one of the biggest concerns that anybody has when they enter the workforce, they want to be confident that there's job security, and that's just something that we're not confident about right now. And many of the workers on the floor come to me with their concerns not only from a religious or spiritual aspect of it but just in general. They want to find someone that they can confide in about their feelings and somebody that's going to give them a sense of hope during all of this uncertainty.

MARTIN: Well, do you have hope? I mean, you're in the same boat.

Mr. SPRINGER: Most certainly. Yes, most certainly.

MARTIN: You do? Because - is it based on the facts in front of you in the paper or is it more based on your spiritual convictions?

Mr. SPRINGER: Well, not to sound negative, but I certainly don't place any confidence in the government.

(Soundbite of laughter)

Mr. SPRINGER: And I don't place a great deal of confidence in my job, you know, insomuch as it provides a lifestyle for me that I ordinarily would not be able to experience. But ultimately, my confidence is in God, and that's what I try to convey to many of the workers on the floor. This is what they should attempt to do, to put their confidence in God because ultimately he is in control of everything that we face in life. And if you believe that, then you can kind of go through circumstances with a great deal more confidence.

MARTIN: But what about confidence in your management?

Mr. SPRINGER: I do have some confidence in them, although at times it seems as though there is a division amongst management and union. And without getting into a great deal about that, management sees things a little bit differently than those of us that work on the floor. They look in terms of numbers and production, but we're mostly concerned about livelihood. And I think from the business standpoint of it, they don't really share some of the sensitivities that we have of a lot of other issues that we're experiencing right now. They don't share the same sensitivity that we have.

MARTIN: Let me go back to Jerome because it seems to me that there is a similar split on Capitol Hill. I don't know if you read it that way. There just seemed to have been - one of the things that held up the resolution around the bailout plan was that there were different perspectives about whether this money is actually going to help in a long run anywhere or is it just delaying the inevitable? Now as I understand it, this is a short-term fix. The two companies have until March 31st to produce a plan for long-term profitability, which includes concessions, as Cecel was pointing out. Is there - Jerome, is there a sense that they can actually meet that deadline? And what happens if they don't?

VAUGHN: Well, if they don't, you know, there is provisions that they might have to, you know, give the money back, that might force them immediately into bankruptcy. And one of the key concerns has been if any of the automakers goes into bankruptcy, that would end up in liquidation as opposed to having a chance to come back and restructure, and there would be a domino effect across the rest of the industry. And so everyone is really concerned about that right now.

Are they going to be able to do it together? It is a lot to ask in just a few months' time, but the hope is that the Obama administration will have a little bit more - give the companies a little bit more leeway to kind of turn it around. That's the hope. The reality is, no matter what happens, a lot of people are going to lose their jobs. And I think that's what people are really concerned about in Detroit as well, right now, is what's the effect going to be on the grocery store or on the diner next door? Was that ripple effect going to be in town?

MARTIN: If you're just joining us, you're listening to Tell Me More from NPR News. I'm speaking with Jerome Vaughn of member station WDET in Detroit and Cecel Springer, a production worker and a chaplain about the auto industry bailout.

Jerome, what's the reaction when you hear debate about whether the industries' woes are the result of poor management, whether they're in essence their own fault? And then you get this news about Toyota planning to report a loss for the first time in - in - ever. So what's the reaction to that? Is there any sympathy for the point of view that perhaps the current situation is in part a result of poor planning, poor management, lack of creativity, et cetera?

VAUGHN: I think most people have an understanding that there's some of both involved there, that, you know, Rick Wagoner, CEO of GM, even said, you know, we've made some mistakes. We've spent too much time sort of pushing the high-profit, low-mileage vehicles, and there's some understanding of that. But at the same time, there was this perfect storm, you know. During the summer gas hit $4 a gallon and that caused problems and then the financial crisis, so people are having a harder time than normal getting auto loans. It's sort of all spun together to create this crisis.

I think the fact that you see Toyota forecasting its first ever loss tells you that it's not just a problem with GM, Ford and Chrysler, that all of the world's automakers are having issues right now because of this perfect storm.

MARTIN: Cecel, do you think - now I don't want to put you on the spot here, and I apologize if I am, but do you think that you'll retire from this industry?

Mr. SPRINGER: It - there is a possibility. But the way things appear right now, I would have to say that that is highly unlikely. We've had a great number of those in management, even from my own facility, to just recently take a buyout. And as a result of that, there's been a great deal of shifting on the work floor and in management to kind of fill those vacancies, and we don't know what exactly is going to happen from this point forward.

As you all mentioned, there is a shared responsibility, that there has been some mismanagement. They've not always made excellent decisions, at least in terms of overproducing a lot of product. We've had to come to the decision of reducing some of our product lines even though many of them had been good sellers. We've come into a position to where we've almost competed with ourselves because we've had so many vehicles in production that have done well, but you have to come to a decision, well, do I want to buy a jeep or do I want to buy a 300M? And that's been the dilemma of many of our shoppers.

But ultimately, I think, when this whole deal comes to fruition and when it's decided what is exactly going to be done with the funds, I think ultimately we have to have people back to work regardless of the restructuring that takes place within the automotive industry. If nobody's working, still there aren't going to be any vehicle purchases. So I think that's the number one concern that ought to be addressed as well.

MARTIN: Just briefly, Cecel. We only have about a minute left. How's morale?

Mr. SPRINGER: Oh, morale seems to be pretty good. Again, when you have people such as myself that are working on the floor to constantly encourage and remind the people that there is a brighter day and that there is some ray of hope at the end of all of this, it kind of gives them, you know, a good feeling about showing up to work every morning.

MARTIN: OK.

Mr. SPRINGER: And that's where I value the position that I hold as chaplain because I take part in bringing some of that hope to many of our workers, and I'm glad about that.

MARTIN: All right. Well, thank you for that. Jerome, final thought from you very briefly. What's the next thing we should be looking for as we pursue this story?

VAUGHN: Well, I think what everyone is waiting for is to see what plan GM and Chrysler and Ford are going to come forward with and what the response from an Obama administration is going to be. That's going to be key.

MARTIN: Jerome Vaughn is news director at member station WDET in Detroit. Cecel Springer is an auto assembly production worker and chaplain for Chrysler Corporation. They both joined me from WDET. I thank you both so much for speaking with us, and Happy Holidays to you both.

Mr. SPRINGER: Thank you so much, and Happy Holidays to you, as well.

VAUGHN: Same to you.

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