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
TheStreet Open House

Why There's Still Hope for Detroit

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 - Get Report) 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

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

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
Stocks Under $10

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

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
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

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

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
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!
SYM TRADE IT LAST %CHG
F $15.98 0.00%
GM $37.31 0.00%
HMC $33.46 0.00%
TM $142.40 0.00%
AAPL $123.25 0.00%

Markets

DOW 17,712.66 +34.43 0.19%
S&P 500 2,061.02 +4.87 0.24%
NASDAQ 4,891.2190 +27.8570 0.57%

Partners Compare Online Brokers

Free Reports

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