Business & Technology

Big Three on credit watch

S&P cites automakers’ cashflow concerns

Originally posted at the NDN Blog. While news about high fuel prices this past week centered on disingenuous calls by President Bush and others to drill our way out of the crisis, perhaps the most significant -- and ominous event -- was the barely publicized action by S&P Friday to place the Big Three U.S. automakers on a credit watch. In taking the action, S&P cited "renewed concerns about the three car makers' future cash flows." Given Ford's preexisting troubles -- accentuated by its announcement last week as well that it is postponing relaunch of its star vehicle, the F150 truck -- Chrysler's uncertain future under private equity management, and GM's plummeting market share, the announcement raises real questions about the survival of the U.S. auto industry. Domestic car sales were already down about two million vehicles this year from their high in 2006 before the current fuel crisis. Plummeting sales and oceans of red ink -- as customers struggling under the weight of sky-high consumer debt payments and declining wages eschew the gas guzzling stars of only two years ago -- threaten the U.S. auto industry's very existence. The potential collapse of the Big Three -- still the second largest employer in the country after the government -- calls into question the very essence of the American way of life.

Sustainable economy 101

Lessons from Europe and Japan

The following article appeared in Foreign Policy in Focus, and was reposted at When New York City wanted to make the biggest purchase of subway cars in U.S. history in the late 1990s -- more than $3 billion worth -- the only companies that were able to bid on the contract were foreign. The same problem applies to high-speed rail today: Only European or Japanese companies can build any of the proposed rail networks in the United States. The U.S. has also ceded the high ground to Europe and Japan in a broad range of other sustainable technologies. For instance, 11 companies produce 96 percent of medium to large wind turbines (PDF); only one, GE, is based in the United States, with a 16 percent share of the global market. The differences in market penetration come down to two factors: European and Japanese companies have become more competent producers for these markets, and their governments have helped them to develop both this competence and the markets themselves.

Entreprenews you can use: Sungevity

‘Dell of solar’ seeks to make it cheap and user-friendly to get rooftop PV

Today, a company called Sungevity announced the availability of what they’re calling the cheapest solar system in the world: a rooftop solar panel system, fully installed, for $2,000. That’s as much as I paid for my computer. For that price, the average home will save $21,000 in electricity over 25 years — a 45 percent return on investment. From a simple web interface, customers can plug in their address and Sungevity will use satellite and aerial imagery to assess their rooftop solar potential and offer them a range of options within 24 hours. Ordering can be done online, as easily …

Green coal baron?

NYT Magazine’s fawning piece on Duke Energy CEO Jim Rogers

There's no doubt about it: Duke Energy CEO Jim Rogers is the most adept figure in corporate America at making himself look better than he is. He's proven it again in an extremely flattering profile in The New York Times Sunday Magazine. The piece refers to Rogers as "one of the electricity industry's most vocal environmentalists." Indeed, the piece reports that many "prominent environmentalists" are his "friends" and quotes in particular Eileen Claussen, head of the Pew Center on Global Climate Change, saying, "It's fair to say that we wouldn't be where we are in Congress if it weren't for him," and that "he helped put carbon legislation on the map." That legislation, the Lieberman-Warner bill, sputtered apart when the Senate took it up. (Even though we're told Barbara Boxer staged a post-failure victory celebration. Never underestimate the power of self delusion in Washington.) And one reason for its demise was the active opposition of Rogers, who mobilized numerous businesses to complain about the costs.

Carmaker knows most efficient freight system: trains

Interesting presser from Honda this week:

Big bad boom

Radioactive deja vu in the American West

This is a guest essay from Chip Ward, author and board member of the Southern Utah Wilderness Alliance. It was originally published on TomDispatch and is republished here with Tom’s kind permission. —– In the American West, we take global warming personally. Like those polar bears desperately hunting for dwindling ice flows, we feel we’re on the frontlines of the new weather regime. The West is drying up. For example, canyon-hugging conservationists and jet-boating gear-heads have argued for several years about whether to “drain” Lake Powell, the 200 mile-long reservoir that once drowned the redrock Eden which was Glen Canyon. …

What do oil lobbyists think about drilling for oil?

Here, MSNBC’s Andrea Mitchell discusses McCain’s plan to drill, drill, drill with RNC deputy chairman and McCain supporter Frank Donatelli: What Mitchell didn’t tell you: Before joining the RNC, Donatelli was a registered lobbyist. For whom, you ask? What type of clients? Three guesses! Oh, fine, you got it the first time: ExxonMobil Corp. and Dominion Resources. But why would MSNBC viewers need to know that?

Pause for effect

Iconic Ford SUV plant to be idled for summer

Photo: Dean Souglass Ford will close its Michigan Truck Plant in Wayne for nine weeks -- four weeks longer than previously announced -- starting on June 23. Birthplace to Lincoln Navigators and Ford Expeditions, the MTP has come in for hard times due to the plummeting market for SUVs. Since January, Expedition sales are down 31 percent; Navigators, 22 percent. Once bread and butter for American automakers, SUVs have fallen victim to $4-a-gallon gasoline. To the lay observer, the temporary MTP closure is just another symptom of the shift away from SUVs, but it actually signifies a whole lot more for American automakers: At the height of the SUV boom in the late '90s, the MTP was the most profitable factory, in any industry, anywhere in the world. Keith Bradsher, Detroit bureau chief of The New York Times from 1996 to 2001, wrote in his book High and Mighty: The Dangerous Rise of the SUV:

Coal credit?

NYC comptroller urges scrutiny of tax-free bonds for coal-fired power plants

It hasn't made big news yet outside of specialty publications such as Bond Buyer. But a call this week by New York City Comptroller William C. Thompson could cast a new cloud over a half-dozen or more planned new coal-fired electric power plants. Thompson called on the U.S. Treasury Department to investigate the practice of using tax-free bonds to finance new coal plants. In the letter, online at, Thompson pointed to recent research which found that coal plants were poor candidates for federal financing and problematic for investors. There are at least a half-dozen planned new power plants that would rely on tax-exempt bonds. The Treasury Department has announced it would take a hard look at use of such bonds for sports arenas. You'd think they ought to take an even harder look at old-fashioned coal plants.

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