Should the US bailout the big three automakers?

[Don]

Regarding the fees as mentioned below, nothing stated on the impact the fees would have on decreasing the sales of new cars.

"........idea of a fee levied on every foreign or domestic vehicle sold that could raise billions a year for automakers "

USA Today Friday Nov 21:

" Idea to aid carmakers: Fee on sales "
By Chris Woodyard, USA TODAY

" LOS ANGELES — Automotive titan Roger Penske thinks he's found a simple answer to bailing out Detroit's automakers — a restructuring fee that would be added to the price of every new car.

Instead of government loans to try to bridge General Motors (GM), Ford Motor (F) and Chrysler through their financial crisis, Penske said Thursday that he likes the idea of a fee levied on every foreign or domestic vehicle sold that could raise billions a year for automakers.

Proceeds from the fee — he suggested $200 or $500 per car — would help relieve automakers of their health and retirement burdens. It could also go to buying out underperforming auto dealers. Laws in many states prevent automakers from closing dealers outright.

"It would level the playing field," said Penske, CEO of one of the nation's largest automotive dealer groups, importer of the Smart microcar and auto racing legend, in an interview at the Los Angeles Auto Show. "It helps pay for some of these legacy costs."

Penske says he thinks the time is right because Congress has yet to figure out how to structure a bailout plan that garners widespread support.

He says the proposal comes from Tom Dekar, regional managing principal for the accounting firm Deloitte & Touche. Dekar said he only wants to float the idea as his personal view to enhance discussion to solve the crisis.

It was one of several that he says he devised after talking to Michigan Gov. Jennifer Granholm. The governor's spokeswoman, Liz Boyd, said she could not immediately reach her for comment.

The proposal would recognize automaking "as a strategic industry," Dekar said. "Everyone is beating up the Big Three." But he says the criticism is unfair because Detroit's trouble can be traced largely to taking care of their workers in the industry's heyday. Now the unionized workforces burden the Big Three with costs not shared by non-union plants of foreign rivals in the USA.

Penske says he thinks even foreign makers would line up behind a fee because they have already said the Big Three's survival is critical to their ability to maintain their base of key suppliers.

Initial reaction to the idea appears skeptical, however. Stephen Collins, president of the Automotive Trade Policy Council in Washington, says a new fee or tax won't be popular — a loan would "lower costs rather than raise taxes" on car buyers. "