May 12, 2009, - 5:32 pm

AUTO-Crat in Chief: Obama Halves Chrysler’s Marketing Budget

By Debbie Schlussel
When Barack Obama joked at the White House Correspondents Association dinner that Car and Driver named him auto executive of the year, he was supposed to be joking.
But he really wasn’t. The last laugh is on the companies who accepted government bailouts and the resulting government-style management.

Chrysler wanted to spend $134 million in advertising over the nine weeks it’s expected to be in bankruptcy — the U.S. Treasury’s auto-industry task force gave it half that.

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So if GM, which is wrestling with the possibility of a Chapter 11 filing itself, is wondering how much influence the task force will have over marketing, the answer is: plenty. However, transcripts from the U.S. Bankruptcy Court for Southern District of New York, where the Chrysler case is being heard, proved for the first time that the task force at least understands that advertising is a necessary expense — even if it doesn’t think Chrysler needs $134 million for nine weeks of car ads.
As Chrysler prepares to spend the $67 million the task force approved, GM is cutting back as it tries to slim down to satisfy a June 1 deadline set by the Treasury’s auto task force. Few, however, believe GM can avoid following Chrysler into bankruptcy court. . . .
GM reduced ad spending “some” in the first quarter, Chief Financial Officer Ray Young revealed last week in a conference call about the company’s $6 billion global loss in the period. He noted in the call that GM is closely following Chrysler’s procedures “in case we have to go through it.”

Can’t wait until Obama goes to BBDO ad pitch meetings. (Where’s Don Draper when you need him?) Maybe they should put a hammer and sickle in the ads. You know, just for truth in advertising.

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12 Responses

The federal government is well on the way to nationalizing the auto industry. That is truth in advertising. Only it won’t let you know about it.

NormanF on May 12, 2009 at 6:25 pm

If Chrysler can’t spend enough to sell their cars, they will go into a real bankruptcy and everything being done now will be both a waste of time and money.
How much is enough? I don’t know. However, the marketing people working for Chrysler probably do know, and I cannot think of any incentive for them to want to spend too much.
We are the government and we are here to help you …

i_am_me on May 12, 2009 at 7:07 pm

Shame on the O’Bama Administration! They should have DOUBLED Chrysler’s advertising budget. This Administration OWES the LIB media for getting them elected. What better way to pay the LIB media back than keeping Chrysler’s advertising budget hefty at the taxpayers’ expense.
Let this be yet ANOTHER lesson for O’Bama supporters! No good deed done for Barack O’Bama goes unpunished.

There is NO Santa Claus on May 12, 2009 at 7:07 pm

Thanks for nothing you idiots that now pray five times a day, facing Washington. Incredible, how in a a few short months, this illegal alien from Kenya has been allowed to destroyed America. PIST!

Jackson Pearson on May 12, 2009 at 8:26 pm

Amen, Jackson Pearson. A MUSLIM illegal alien from Kenya.

lexi on May 12, 2009 at 11:45 pm

Why is there any issue of supporting Chrysler? Aren’t they foreign owned by Mercedes Benz?

Facts of Life on May 13, 2009 at 8:54 am

Facts of Life; Daimler (aka: Merecedes Benz) did merger with Chrysler and then ended it. Hence the marriage between these two companies ended in divorce and Chrysler became a separate entity again. Hope that answers your question.
Now Fiat is saying once their deal is done with Chrysler the top executives will become Fiat employees and their pay will no longer be structured under what the US government believes is fair. In fact Fiat stated they want to give back ALL the money the Obama administration gave them plus the accurred interest. So, the American government can no longer have a say so in daily operations. Fiat mentioned that they are glad that Chrysler is in Chapter 11 Bankrupcy court to re-struct their debts. Chapter 11 is far from being fair to creditors and usually benefits the company in Chapter 11. Key is that when the Bankrupcy court and trustee say something that’s how it goes. Unions are a huge problem and refuse to take concessions. In Bankrupcy the courts essentially put a stop to the Unions dictating what they want.
Not sure why the auto industry and AIG and et al. Even took the government bailouts. They should’ve have used the Bankrupcy court system as a tool to reoraganize and get their act together. Many companies went down this route with great success when they emerged. America West Airlines went into chapter 11 and came out just fine. In fact they did it two times. And now America West Airlines was subsequently merged with Continential Airlines and doing relatively well, considering the economic problems our large corporations are facing today.
There are many other large corporations who filed chapter 11 and came out stronger and continue to do well. There was never a need for the government to intervene in the first place.
This is just another BS ploy for Obama to run things. There is a reason we have bankrupcy court for companies and on a individual basis. And like I said above, it’s not always fair to the creditors, but the end results yield a positive outcome for all in most cases.
If for some reason Chrysler had to sell off brand names they would do well. Jeep is a strong competitor in the SUV market. Jeep makes quality SUV’s and even got smart in offerring all sizes at reasonable prices.
I’m not thrilled that a foreign auto company is merging with Chrysler. And Fiat is known to make cheap vehicles. But, they’re the only option at this time and getting a sweet heart deal too. Once Chrysler is stablize, you can be assured that they will do whatever it takes to separate from Fiat.
Really sucks how Obama is trying so hard to force these little eco-friendly vehicles on us like it’s done in Europe. Obama wants to cap and trade the auto industry and then trick the American people by giving a tax credit in the amount of roughly $4500 to purchase a smaller more economic vehicle. But, the big questions is where is the money going to come from when people redeem this tax credit for the purchase of a new vehicle? From the taxpayers of course. And Obama is now considerring a signifigant tax increase on gasoline. Again, the taxpayer gets screwed.
Obama seriously believes by expanding and growing government. Spending more money will help us during this economic bad times. Well, he should look at history and learn from that. It will not work and never has. Obama is being aggressive in trying to implement policies, laws and etc., which are not proven. Our nation has been in this situation before and we emerged from it quite well. He should allow the markets to correct themselves and not get involved. Sure, some governmental oversight is necessary when it comes to certain things….i.e. AIG. But government is not about being business people. All the Obama Administration is going to go is make matter far worse. Ths is not a time to experiment with new and unproven ideas.
Since Obama took office and now with his budget policy set. The national debt has gone up 4x’s and that’s just in six months. Something is not right and where you smell smoke their might be a fire. Maybe Obama wants us to fail. So he can incorporate his vision of what America needs to be. I really believe the man is delusional and hasn’t a clue what he’s doing.

Tenn Scholar on May 13, 2009 at 9:48 am

Tenn Scholar you are right on.
Obama has the typical characteristic of a drug addict, and a narcissus, a dangerous combination. He is still an illegal alien with no experience at all.

Johnny V on May 13, 2009 at 12:35 pm

Great to see this website attracting more birthers. Turn up the volume, please. Start your own blogs. And shout it from the highest hill. “Obama is an illegal alien!”
It bodes well for the GOP.

Middleman on May 13, 2009 at 1:48 pm

Nothing like the government running a business. Could someone please tell me all the successful departments the government has? Or any business they run well? Why do you think these idiots go into government? Because they sure as hell can’t run a business or keep a real job! Hell almost all BO’S boys and girls are tax cheats, makes sense to me. Next we should appoint Marion Berry as the drug czar!

ohboyohboy on May 13, 2009 at 2:49 pm

Tenn Scholar,
Thanks for the informative reply.

Facts of Life on May 14, 2009 at 9:14 am

Right on Tenn Scholar and OhBoy!
This whole situation reminds me of how the Mob or any other “Protection Racket” operates. First the thugs (congress/big gov’t) walk into your business, rough up the clerk and ruin or steal your inventory (passing burdensome legislation such as cafe fuel standards). Then the next day the Boss comes in (The Obama Admin)and says “Wow, looks like you’re having some trouble… If you like, I can protect you and maybe help replace that merchandise too…” At which point the Mob offers you protection and dirty money(Bailout cash stolen from taxpayers) so you can stay in business for a while. But one day, that Boss comes in and asks you to repay his favor, and no matter how detestable his request, you have to agree since now they protect you and fund your crippled enterprise. (Obama asks to control CEO pay, advertising expenditures, warrantees, and product lines.)
If a company takes money from the gov’t (or the mob) they will never know when they will call on you for that favor, or what that favor might be…

DontTreadOnMe on May 14, 2009 at 3:52 pm

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