November 21, 2008

Penske suggests a car sales fee

Businessman and auto racing legend Roger Penske said a restructuring fee of up to $500 on every new car sold could dig U.S. automakers out of trouble.

It would level the playing field, said Penske, chief executive officer of Penske Corp. one of the largest U.S. dealership groups, USA Today reported Friday.

Penske said the fee would cover the cost of buying out weaker dealerships and a portion of the health and retirement burdens of Detroit's Big Three automakers.

Tom Dekar of the accounting firm Deloitte & Touche. Dekar came up with the idea, Penske said during an interview at the Los Angeles Auto Show.

Dekar said criticism of the automakers is unfair, as they choose to take care of their employees when times were better. Now, unionized U.S. companies are at a disadvantage when competing against foreign companies staffing auto plants in the United States with non-union employees.

But, Penske believes even foreign companies would endorse the idea, as they have already said Ford Motor Co., General Motors Corp. and Chrysler are vital to maintaining a strong base of industry supply companies.