A Proposal for President Obama

President Obama:

I can save the American automotive industry, and it will only cost the taxpayers 10 billion dollars (which is less than half of what GM and Chrysler are requesting). Please make the check payable to “Scott Bradford”. I will be happy to pick it up at the White House, or we can make arrangements for a direct deposit if that’s easier. This payment is a one-time, non-refundable investment in the creation of a new privately-held company: American Motors, LLC.

I will need two things from you (in addition to the 10 billion dollars). First, I will need legal authority to terminate union contracts that were signed by the current U.S. auto manufacturers under duress (the threat of a United Auto Workers [UAW] strike), which should be legally invalid anyway. Second, I will need your support and Federal Trade Commission (FTC) approval for American Motors, LLC to purchase all three of the ‘big three’ auto manufacturers. I figure if you can get Congress to approve an 800 billion dollars ‘stimulus’ in two weeks, you should be able to get these things approved in that time or less.

I have a very simple plan:

First, I will use the 10 billion dollars to purchase all outstanding shares of the Ford Motor Company (approx. $4.04b) and General Motors (approx. $1.33b). I will also purchase Chrysler, LLC from its two owners, Cerberus Capital Management LP and Daimler AG, privately (price unknown). I fully expect American Motors, LLC to be able to seize control of each of the ‘big three’ for less than 10 billion dollars.

Second, after having taken Ford and GM private, I will dismiss the respective boards and executive leadership of all three companies. These executives will be offered an opportunity to re-apply for their jobs in open competition with other applicants.

Third, I will dissolve all illicit contracts with the UAW labor cartel and terminate employment of all hourly employees. All production will be stopped at all three companies for at least two months as the company is entirely restructured and the factories are retooled, if necessary. All laid-off employees will be permitted to re-apply for their positions in open competition with other applicants (although the total number of employees will be reduced, so many will not be re-hired). New employees will be offered fair, market-determined rates and benefits comparable to those at non-UAW U.S. auto factories.

Fourth, during the two month production freeze, the new (lean-and-mean) management team overseeing the integration of Ford, GM, and Chrysler into American Motors, LLC will furiously determine the best structure of brands and products for long-term success. Most brands will disappear. There will be a mess of products from the three (or more) different engineering families for a short while, but we will put an aggressive plan in place to establish a single, cohesive, worldwide product line with shared engineering components within two model years (by 2012) using the best technologies from each of the three legacy companies.

Regardless of the original progeny of the surviving product lines, the branding will be simplified in that two year period: regular cars, minivans, and crossovers will be branded as Fords. Luxury vehicles will be branded as Cadillacs. Trucks and large SUVs will be branded as Jeeps. There will be virtually no internal competition or needless complexity to the product line.

This plan will hurt, in the short term. Hundreds upon hundreds of dealerships will need to close their doors or combine with neighboring dealers. Employees will need to be laid off in great numbers. There will, indeed, be ripple effects on suppliers and elsewhere. So? We have to bite the bullet sooner or later, so we might as well go all out. When compared to the alternative—letting the manufacturers continue on with repetitive infusions of taxpayer dollars—I’m offering you a true bargain.

At the end of this two year period, the drastically reduced costs and improved products (developed by the best engineers from each of the three legacy companies) will result in a profitable American automotive industry that can compete with the foreign manufacturers. I’m offering all this with minimal federal investment (although, of course, success cannot be guaranteed).

Thank you, President Obama. I eagerly await your reply.

Scott Bradford is a writer and technologist who has been putting his opinions online since 1995. He believes in three inviolable human rights: life, liberty, and property. He is a Catholic Christian who worships the trinitarian God described in the Nicene Creed. Scott is a husband, nerd, pet lover, and AMC/Jeep enthusiast with a B.S. degree in public administration from George Mason University.