Like the rest of their class, the automobile manufacturers are hoarding cash. Automotive News for October 10 cites a new study by IHS Automotive:
Car companies are holding a quarter-trillion dollars in cash and equivalents, says Charles Chesbrough, senior principal economist at the industry consultancy. And the overall cash-to-revenue ratio is a healthy 19.3 percent, insulating from them a financial crisis.
Leading the pack is Toyota Motor Corp., which is sitting on $42.2 billion, according to Chesbrough’s calculations. Volkswagen AG is a close second with $35.9 billion on the books.
And what of the bail-out recipients, the businesses that won’t be repaying the full amount of the free loans and purchases of radioactive stock they received from Bush and Zerobama?
GM, which went through a quick-rinse bankruptcy during the global financial meltdown, has $32.8 billion.
Chrysler’s cash holdings were rolled into Fiat’s for a total of $27 billion. And in a sign of their strength, Fiat leads the industry with the highest cash-to-revenue ratio, at 36.2 percent.
“Free enterprise.”