Unit 7
Can Detroit Be Retooled — Before It's Too Late?
Exercises
1. Answer the questions on the text:
1) what is the problem the would-be car buyers may face according to Rod Buscher, CEO of Summit Automotive Partners in Denver?
The would-be buyers lack either the income or the access to credit that would allow them to drive a new car off the lot.
2) Why is GM said to have a stark and steep job to do when the President’s auto task force presented the to-do list?
According to the list GM has to shrink labor costs, including retiree health-care expenses; slash debt; kill or sell low-performing brands; and reduce the number of models for sale and the number of dealers selling them. Should all the parties concerned fail to accomplish that by the deadline of June 1, GM may go into bankcruptcy.
3) How can U.S. automakers take advantage of the coming car boom?
Companies that can meet consumers' needs for fuel-efficient yet stylish cars — and that have flexible manufacturing plants to turn out the hot products on demand — are likely to find huge opportunities for growth in the coming car boom.
4) What does the White House’s auto-task-force working group plan to do with Chrysler?
It plans to close the deal on Chrysler's sale to Fiat. Ron Bloom, one head of the group, has taken the lead in trying to negotiate the sale of 20% (at least initially) of Chrysler to Fiat.
5) What is VEBA approach to solve GM’s problem of retiree health and pension benefits?
In a VEBA, the union agrees to accept a cash payment to fund a new health-care system that trustees administer, thus taking future liabilities off the company's books.
6) Why does the UAW feel particularly aggrieved about the task force's approach?
Because it has agreed to an unending series of givebacks over the past 20 years. Even before this latest crisis, the UAW’s agreement to the 2007 contract would have put Detroit's labor cost per car within a couple of hundred dollars of Toyota's and the other foreign automakers’.
7) Why are analysts so optimistic about the future car sales?
Because Americans have been putting off buying cars for nearly two years and showroom traffic is increasing ,which means pent-up demand is building.The prospect of car sales is sure to be great when credit starts to loosen as history
indicates.
8) What are the elements that make analysts believe North American demand for cars will approach 16 million units within five years from the year 2009? The elements include the replacement demand, scrappage rates, demographic changes and an economic recovery.
9) What are the competitive GM brands mentened in the passage?
They are award-winning Chevy Malibu and the 2009 Buick LaCrosse, which recently topped all midsize competitors in dependability ratings.
10) What competition will the US car industry face in the near future?
The US car industry will have to win millions of buyers’ recognition for their
brands, and try to play better in the competition with companies in Asia, such as China's Chery Automobile and India's Tata Motors, as well as the established players like Volkswagen and Hyundai-Kia.
2. Fill in each blank of the following sentences with one of the phrases in the list given below:
1) With his expanding wireless broadband plan, Obama wants to usher every
American into the 'Digital Age'.
2) School activities start winding down about two weeks before the end of
semester.
3) The man said he couldn't come up with an appropriate answer just at the time. 4) Everybody is sure that the ceaseless dripping of water will in the end hollow out
a stone.
5) The progressive movement, which had already brought important changes in
federal policies, stood on the verge of culmination and fulfillment
6) The state has suffered so much loss. The smugglers should never be allowed to
get off easy. 7) After production expansion, this company now can turn out a million television sets a month.
8) The preeminent writer's personal appearance picked up the sales of the book considerably
9) The newly announced credit policy may help many family-owned businesses get
through the tough times at present..
10) The government has imposed drastic economic controls to choke off inflation. 11) To execute full-cost accounting, companies must account for the true cost of their products.
12) Economists are not so optimistic because there is no sign that the recession has bottomed out.
3. Match the terms in column A with the explanations in column B:
A B 1) bondholder a) A measure of a company's financial health,which
equals cash receipts minus cash payments over a given period of time. 6 2) creditor b) A financial asset whose value has fallen
significantly and which fails generate cashflow
and is worth much less than expected. 7
3) dealership c) An entity (person or institution) that extends
credit by giving another entity permission to borrow money if it is paid back at a later date. 2 4) health-care expenses d) A unit specially organized to work on a single
defined task 10
5) manufacturing capacity e) A business company that is owned or controlled
by another larger company 9
6) net cash flow f) A person owning a bond or bonds issued by a
government or a public company 1 7) bad asset g) Money used for the preservation of mental and
physical health by preventing or treating illness through services offered by the health profession 4 8) hot products h) Volume of products or services that can be
generated by a production plant or enterprise in a given period by using current resources. 5
9) subsidiary# i) A business established or operated under an
authorization to sell or distribute a company’s goods or service in a particular area 3 10) task force j) Products that are extremely populous among
consumers and normally sell like hot cakes in the market. 8
4. Translate the following into Chinese:
凭借这股势头，现代集团正加快从生产线上推出新车型的速度。美国的消费者在12月份已经看到了簇新的2011款索纳塔，比先前的投放计划提早了两个月，这是因为现代公司以超凡的速度提前了生产进程。
汽车厂商通常不愿干扰工厂的生产计划，因为那样做会影响零部件供应链，导致装配问题，代价高昂。但是，现代却决定提前动工，因为公司早期的产品质量控制良好，加之供应商储备充足，工程师们也做好了筹建阿拉巴马州工厂的准备，于是速度成为了一种竞争优势。
现代汽车公司行动迅速果敢，已成为世界上发展最快的重要汽车厂商。当今全球汽车销售低迷，现代却在9月30日结束的第三季度中创造了8亿3200万美元的销售记录。分析人士预计今年现代的净利润会上涨近40%。
尽管现代公司只成立了43年，相对比较年轻，但是据环球通视咨询公司(IHS Global Insight)统计，它的产量已经排在全球第五位，2009年又超过了有着107
年历史的福特公司（财富500强企业）晋升至第四位。几年前，丰田公司曾认为现代是它最惧怕的公司，如今所有的忧虑已成为噩梦。
尽管公司业绩斐然，现代的高管们仍在努力争取更辉煌的成功。现代和起亚目前的生产能力为580万辆轿车和卡车。现代的总裁兼首席执行官梁承锡说：“我们要在两年内把产量提升至650万辆。” 他当时正在首尔的一家小餐馆吃传统韩式午餐。
现代计划2009年生产520万台汽车，那就意味着公司要满负荷运转才能大幅提高产量。西方的汽车专家对如此宏大的扩张计划颇感惊惧，因为产量的剧增势必会以降低质量、削弱品牌为代价。但是梁却淡然一笑，做出保证，仿佛他只是在客气地闲谈而已。现代公司的人都知道，实现不可能的目标就是现代办事方式的一部分。
超速发展容易引发事故。1986年，现代以一款售价仅为4995美元的“卓越”（Excel）打入美国市场，此价格立即征服了想买廉价车的美国消费者。于是，现代创下了第一年销售12万6千辆车的记录。
第二年，现代提出了“概念车”的口号，售出26万4千台“卓越”，又创了纪录。在飞速发展的过程中，现代犯了两个近乎致命的错误。其一，汽车质量差劲；其二，买主资信糟糕。当车辆因贷款人无法还贷而被收回时，因其质量太差竟不值尚未偿还的贷款。
5. Fill in each of the following gaps with one of the sentences given below:
What's wrong with Toyota?
1) Not much. At least not from an engineering, mechanical or even a quality
point of view.
2) To create a modern car, a company has to design, engineer, build, buy and
then assemble some 10,000 parts.
3) Though those are errors that will cost it more than $2 billion in repairs and
lost sales this year.
4) Although the recalls seemed sudden, the evidence has been piling up.
5) That was followed by the first of several National Highway Traffic Safety
Administration (NHTSA) investigations, in 2003, and two small recalls in 2005 and 2007.
Supplementary Reading
Reading comprehension questions:
1）What does James Gorman ,the new chief exetutive, try to do to reshape Morgan Stanley after the crisis? ________
A. Try to get government help and some timely investments from Asia.
B. Try to undo much of the firm’s pre-crisis expansion. ∨ C. Fire more people to control costs.
D. Make more mergers and acquisitions in the world market.
2）Who is Morgan Stanley’s main rival? A. Smith Barney B. CLSA
C. Agricultural Bank of China D. Goldman Sachs ∨
3）Which of the following statement about the Smith Barney deal is true? ________ A. After a good first half of the year, the firm made profits of only $313m, down from almost $1 billion a year earlier.
B. The deal made no difference to the troubled situation.
C. It made Morgan Stanley a superior position in retail brokerage. ∨
D. It was particularly disappointing because its revenues slumped to the lowest since early 2009. 4）What is not the problem in Morgan Stanley Smith Barney (MSSB) according to the passage ?__________
A. There is a lot of money to be made. ∨
B. A lot of leading performers left after the merger. C. The brokers’ compensation ratio was too high. D. There was a fear of losing more talent. 5）What does the sentence “It would take a nuclear weapon to sink a brand as strong as theirs in traditional investment banking.” suggest? _________
A. Morgan Stanley is popular with governments looking to sell shares.
B. Morgan Stanley’s near-death experience and earlier turmoil are controversial. C. Morgan Stanley has been infamous since the turmoil. D. Morgan Stanley’s reputation has remained strong. ∨
6）Is it easy for Morgan Stanley to change the situation from an also-ran to a victor in fixed income? _________ A. Sure it is.
B. It still needs a long way to go. ∨ C. It’s hard to say. D .It’s a big problem.
7）What do you know about John Mack, Morgan Stanley’s former chief executive? _______
A. He is a great bond salesman . ∨ B. He is known for his strategic flair. C. He is a wartime leader.
D. He is a peacetime builder.
8）Which figure is roughly fit to Mr Gorman’s goal on equity in normal markets? ________ A. 20% B. 25% C. 18% ∨ D. 12%
9）What effort has Mr Gorman make to regain Morgan Stanley’s venerable institutional business? ________
A. He has increased emphasis on the retail business.
B. He has hired a batch of experienced relationship managers. ∨ C. He has worked harder to keep big clients sweet. D. He has won a list of hedge-fund contacts.
10）What does Morgan Stanley plan do in the future according to Mr Gorman? _______
A. It will show more discipline in its business dealings. ∨ B. It will define more clearly the sandboxes it plays in. C. It will go through a spin-off from J.P. Morgan.
D .It will look back on the Great Recession from time to time.
