EDITORIAL: Automakers need a plan: Before agreeing to any kind of a bailout, Congress must ensure that Detroit's Big Three truly understand the magnitude of change needed.

Nov 25, 2008 (The Roanoke Times - McClatchy-Tribune Information Services via COMTEX) -- GM | Quote | Chart | News | PowerRating -- House Speaker Nancy Pelosi isn't exactly known for pithy quotes, but she nailed it on the bailout for America's auto manufacturers.

Insisting that auto executives prove they have a real plan for turning around their floundering businesses before Congress puts any tax dollars into a bailout, Pelosi said, "Until they show us the plan we cannot show them the money."

That's a wise precondition. General Motors lost more than $4 billion last quarter alone. Unless the Big Three auto companies prove they have an idea of the magnitude of restructuring necessary to pull out of this tailspin, an infusion of taxpayer cash would serve only to buy time -- and not much of it.

As Rep. Michael Capuano, D-Mass., said, "My fear is that you're going to take this money and continue the same stupid decisions you've made for 25 years."

Still, a bailout of some sort seems likely.

Though some experts believe that only the tough love of bankruptcy will provide the impetus for true change, others worry bankruptcy would be fatal to a car company.

Unlike other companies, such as airlines, that can emerge from bankruptcy leaner and stronger, auto manufacturers depend on consumer confidence that the company will be around for the life of the car to provide service and honor the warranty.

There is also a widespread concern that a failure of a domestic automaker during these difficult economic times would have extremely magnified repercussions.

Even Pelosi has said inaction isn't an option. "We don't have any intention of seeing the auto industry go down," she said.

Still, taxpayers grow weary of bailing out bankers, hedge fund managers and other financial titans -- with little so far to show for it. Auto executives did themselves no favors, either, when they flew expensive corporate jets to Washington, D.C., to ask for a handout.

Virginia Sen.-elect Mark Warner got a dig in about that when he summed up his stance on a potential bailout: "It's got to be, you have a plan in place. It's got to be, you're going to bring your costs down. It's got to be, when you come to Washington to ask for a handout, you don't come in a private jet -- you fly coach."

The private jet travel is just symbolic, of course. The $20,000 it cost GM to fly Rick Wagoner from Detroit to D.C. isn't going to be the straw that breaks the company's back. But it's important symbolism. Wagoner and the other CEOs need to demonstrate that they understand the necessity to fundamentally change how they do business, from top to bottom.

The jet rides show that message has been slow to sink in.

Congress needs to make sure it has been fully absorbed before agreeing to any bailout plan.

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