Because of the importance of the measures before congress concerning the auto industry to Texas and Texoma..... KAUZ is dedicating an extended time period normally devoted to our weekly editorial. We've asked Larry Slack to express his views.

Over the past month, leaders on Capitol Hill have been pretty rough on American automotive manufacturers. I appreciate KAUZ's Station Manger Mike DeLier's invitation to present a guest viewpoint.

It appears, that the American automakers request for bridge loan financing is near approval. General Motors will receive a government loan of $9 billion, and Chrysler $6 billion. This is a loan and not a bailout and will extend their operations into the first quarter of 2009. Why all the scrutiny over a $25 billion loan request from the American automakers after approving $700 million for Wall Street? Well, it is the prudent thing for congress to do. In my opinion, congress should have exercised more scrutiny regarding their decisions to grant Wall Street it's financial assistance.

You should know that in the United States this year gm has outsold Toyota by 1.2 million vehicles. Ford, on the other hand has outsold Honda by 850,000 vehicles, and Nissan by 1.2 million vehicles. That indicates American auto manufacturers are building vehicles the American consumer wants to purchase. Did you know there are at least 10 American made vehicles that have "best in class fuel economy?" You may not realize that Ford and GM offer more hybrid models than Nissan or Honda. In fact between 2005 and 2007 ford motor company alone invested more than $22 billion dollars in the research and development of new engine technologies. Clearly these are companies planning for our future's needs.

Over the last 10 years, truck and SUV sales have accounted for roughly 65% of all vehicle sales. Why do we build so many trucks and SUV's? it's really very simple. We try to build what the American consumer wants to purchase. Ford, GM, and Dodge are the dominant players in the truck market. Imagine your lifestyle in Texoma without an American made pickup truck or an American made auto dealership?

What about American automaker's quality? You should know that the American made Ford Fusion, and the Chevy Malibu were both rated superior products by the recent j d power independent survey on initial quality. Consumer Reports magazine now rates Ford on par with all Japanese automakers. In fact on almost any quality report that you access today will show American automakers quality and safety moving to the top of the scale. The quality gap between American and import vehicles has been closed.

How did we get where we are today? These are truly unimaginable times. Gasoline prices rising to $4.00 a gallon in about 30 days caused a 30 percentage point shift from truck to car purchases. No manufacturer had enough cars on the ground. A mortgage crisis taking out several major lenders, a stock market that lost 50% of its value in 13 months, and a credit liquidity crisis of unbelievable proportion, all helped. The result of these events is a severe shortage of credit for everyone, including the automakers. Costs associated with health care and retirement benefits for retired auto workers have also contributed to the problem. These legacy costs are a cash drain on American automakers. Foreign automakers have enjoyed subsidies from their government to help provide health care and retirement benefits for their current and retired workers. American automakers have not received similar government subsidies, and bare these cost entirely on their own. Through negotiations these legacy costs will become the responsibility of the uaw in 2010.

Some say bankruptcy for the Detroit automakers is the answer. Bankruptcy allows companies to reorganize, renegotiate, and break covenants. Creditors can be forced to take less than they are owed. As auto dealers we all have large sums of receivables owed to us by our auto manufacturers in the form of factory rebates, consumer rebates that buyers have assigned to us when purchasing a vehicle, and repairs for warranty work. I suspect most if not all of these receivables would become worth only pennies on the dollar if our manufacturers declared bankruptcy.

Assistance for an American automaker has been done once before. In 1980 Chrysler obtained a government loan of one billion dollars, which was paid back with interest two years ahead of schedule. Assistance for our import competition is not new either. In the early 90's Senator Shelby of Alabama, one of the harshest critics of the American automakers, was the leading force in attracting Honda, Hyundai, and Mercedes Benz to his home state of Alabama. He was successful in attracting them to alabama by giving them public land, and a $253 million dollar incentive package, while the state agreed to purchase 2500 Mercedes Benz vehicles. The total incentive package was just over $180,000 for each new job created. Another strong critic of the American automaker is Senator Bob Corker, of Tennessee. As mayor of Chattanooga, he helped lay the groundwork for a one billion dollar Volkswagen plant in his hometown. Obviously these senators know the importance of government assistance.

For 38 years i have been proud to serve the fine people of Texoma, as an American auto dealer. I am proud of my industry, and indeed my dealership. I am proud that by daughter and son-in-law have joined my dealership, and have become my business partners. It is my dream that some day my grandchildren will operate our dealership. I encourage each of you to be proud of the American manufacturing process, and indeed the American automobile manufacturers. They have contributed greatly to our American dream, even more to our state, local, and national economies, and they have much more to contribute. Visit their dealerships, and discover for yourself the latest in technology and innovation. You'll leave feeling proud you did.

Please go to www.kauz.com and click on the blue Editorial box to express your comments.

KAUZ General Manager Mike DeLier would like to personally thank Mr. Slack for accepting our invitation.