This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Why There's Still Hope for Detroit

Stocks in this article: GM F

OKLAHOMA CITY -- As chairman of the Center for Automotive Research, David E. Cole could fill books with his knowledge of the U.S. automobile industry.

While others have written off General Motors (GM) and the other Detroit automakers, Cole still holds out hope for a happy ending to the story. Cole even looks for some crowd-pleasing plot twists, such as universal health care and battery-powered vehicles, to enhance the tale along the way.

"Because of the crisis atmosphere, you can do big things," Cole explains. "People are willing to do things that they would never do before. Right now, the sense of urgency is very, very high."

Cole remembers the last time the domestic automakers came under serious pressure. In mid-2007, they faced crucial labor negotiations that could ultimately determine their ability to survive. Once the United Auto Workers recognized the gravity of the situation, the union agreed to start covering retiree health benefits, carrying an estimated price tag of $100 billion, a few years down the road.

That groundbreaking deal, set to take effect next January, slashed wages and benefits for incoming workers, as well. It even scaled back benefits for existing employees who had always expected top-notch coverage in the past.

To hear Cole tell it, the Big Three automakers uncovered buried treasure with that legendary deal.

"If you say, 'Here's your choice: You can have the gold or the silver health care plan,' people will take the gold health plan every time," Cole says. "But the axis of choice shifted, and it was no longer gold or silver, but instead silver or lead.

1 of 4

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs