honoluluadvertiser.com

Sponsored by:

Comment, blog & share photos

Log in | Become a member
The Honolulu Advertiser
Updated at 4:59 p.m., Wednesday, December 10, 2008

Hirono, Abercrombie vote yes on auto bailout

By Dennis Camire
Advertiser Washington Bureau

WASHINGTON — Hawai'i's two House members voted Wednesday for a plan to provide $14 billion in emergency loans to keep domestic carmakers in business.

"Collapse of our auto industry would result in the loss of nearly 3 million jobs, including thousands of jobs in Hawai'i," said Rep. Mazie Hirono, D-Hawai'i. "Car dealers in Hawai'i are already laying off employees, and stores selling automotive accessories are also taking a hit."

The bill now goes to the Senate where it faces a fight after Republican senators raised objections and some vowed to filibuster.

Hirono said the plan helps GM, Chrysler and Ford get back on track by providing bridge loans to give them time to come up with a longer-term restructuring plan that includes producing more fuel-efficient cars.

"Collapse of this major industry would have devastating effects on an already fragile economy," Hirono said.

Rep. Neil Abercrombie, D-Hawai'i, said he voted for the plan but wants Congress to go further and provide tax incentives to encourage people to buy cars, such as making interest payments on car loans and excise taxes on cars tax deductible.

"Even if the Big Three companies are able to stay solvent, there needs to be improved consumer demand to ensure car dealerships are able to move inventory and autoworkers have a reason to make more cars," he said. "Without a consumer stimulus, these jobs will be lost and our constituents will be out of jobs, regardless of what assistance we extend to the Big Three automakers."

Abercrombie said the general economic downturn already is having a major impact on Hawai'i automobile dealers and suppliers, who are "absolutely desperate."

"They are keeping people working through Christmas because of the holidays," he said. "After that, there is going to be the specter of mass layoffs."

Hawai'i has about 5,100 people working at new-car dealerships and generated about $2.8 billion in sales in 2007, according to the National Automobile Dealers Association.

Reach Dennis Camire at dcamire@gns.gannett.com.