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GM Target Price Downgraded to $0.00/Worthless
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I thought the reason GM needed saving was because they cba to invest in cleaner fuel R&D/better MPG, and that's why they're sinking...
Yeah, right. I don't think any reasonable analysis of their balance sheet would justify this logic. Unless I completely misunderstand what "they cba to invest" means....
GM did start investing in clean fuel and high MPG, quite a long time ago, but they've never invested in it in a serious way. That's why they keep showcasing fuel-efficient cars that they'll sell in five or ten years and meanwhile everyone else releases them.
That's why they sell 20MPG hybrids of giant SUVs that, at this point, hardly anyone even wants anymore anyways, and make a big deal about their highly fuel efficient 30MPG sedans when their competitors normal gasoline cars made 36 or 38 or even 40MPG without any really special technology years ago. If GM had been serious in its investment in high fuel efficiency, don't ask why they don't have a Prius on the road. Ask why the Cobalt or the Saturn version of the Astra, released into the middle of this quagmire, get 25-30% worse fuel efficiency than same-segment Hondas.
If this is in part to blame for GM's fiscal blows, then it's just another sign of the general mismanagement at GM and nothing specific to the environmental issue. This is the same confused product strategy that builds a pretty good car and then buries it on page 78 of the product catalog after endless pages of crap, and wonders why no one notices it. This is the same confused product strategy that allowed them to not only let their traditional brands founder in brand identity but could even take in a relatively iconic (if quirky) brand like Saab and then even turn its two car lineup into a hodgepodge of oxymorons.
william sire
macrumors regular
Well it looks like we will finally see it happen. What should have happened all along. If a business fails to manage itself properly it should fail. Afterwards they'll be poorer but wiser.
Next time do some research, the Cobalt is VERY competitive in fuel economy.
http://triton.imageshack.us/Himg255...&filename=picture3ng6.png&xsize=578&ysize=480
I will give you the Astra, but besides FE it is a pretty good car.
To further help destroy the perception of American cars not being competitive with the Japanese mainstream, here the the Malibu vs Camry vs Accord.
http://triton.imageshack.us/Himg150...&filename=picture1nf0.png&xsize=578&ysize=480
Sorry... I was talking about the Cobalt when it was originally released... in 2005, when it was initially released, the best option in terms of fuel efficiency was 25/34 (under the old formula). In comparison the most fuel efficient non-hybrid Civic in 2005 was 36/44 (the HX).
That was also the time period when GM was heavily advertising the fuel efficiency of their 30MPG cars...
You're right, though, that the newest revision of the Cobalt is more worthy in that aspect. That's something they could (and should) take more credit for.
On the other hand, in the intervening three years, while the Cobalt's fuel efficiency has improved substantially, where is the hybrid small sedan? And I'd still like to hear what the plan is for producing and delivering the extra plug-point electricity that a transition to plug-in hybrids will require.
Yeah, I went back and looked up the initial FE numbers for the Cobalt when it was released. Damn GM sucked back then. At least they have improved it while the Japanese got worse....
GM's hybrid cars are certainly lacking. The hybrid Malibu is a joke. Gets only 1 MPG better then the 4 banger/6 speed auto combo. The Volt is looking to be a class leading plug in hybrid, but it will cost a pretty penny unfortunately....
A very interesting article about GM's overseas operations, which are actually profitable and growing.
http://www.latimes.com/business/la-fi-gmworld7-2008dec07,0,5011709.story
http://www.latimes.com/business/la-fi-gmworld7-2008dec07,0,5011709.story
I'm certainly not a fan of using taxpayer's dollars to rescue corporations, if only because it gets the government in the business of choosing winners and losers in the economy. But the reality is, government does this all the time with tax policy, and hardly anyone flinches. In this case the government does need to step up, or we're really going to be in a world of hurt. It's not about GM, Chrysler or Ford at this point -- it's about everyone else.
I agree. I'm no fan of bailouts (these are loans actually) but if GM, or to a lesser extent, Chrysler were to fail, the impact on the economy would be horrific.
Exactly: Its not about GM Chrysler or Ford. So what if they go belly up. We have Honda, Toyota, etc. Sorry, I know its tough.
MacGeek hit the nail on the head. Let companies that are profitable survive, its called capitalism.
I know what it's called. I also know what it will be called to have several hundreds of thousands more jobs lost in this economy.
Yeah, the downstream impacts are phenomenal...
The Times brought up the interesting angle on the impact on healthcare today. There are so many other profound consequences to hundreds of thousands of jobs being lost, and hundreds and hundreds of billions being taken out of the GDP.
My bitching is aimed more squarely at using this opportunity to induce long term reform among these three. I do want to see layoffs. Executive layoffs. Particularly at GM, there are a large number of completely useless executive level employees. They've got to go -- not because they're starving the company in terms of their labor costs, but because they're starving the company in terms of their utter inefficacy.
I don't completely disagree with the contribution that higher labor costs play in the Big Three difficulties. On the other hand, however, ten years ago, Ford was making billions in profit, largely on US sales, because they had the pulse of the market and they were making hot products. Granted, those hot products were bad for the environment, but they did evolve because of where the consumer was and not because Ford had some prestanding obsession with trucks. Ford stopped paying attention to customers right before they stopped making money. GM has never understood their customers. And Chrysler... /facepalm.
So I want to see changes that make the Big Three consumer focused again. And I want to see changes that put them on the long-term road to recovery. I sympathize with the labor cost issue, but I also don't think it does any great service to our country to continue to migrate $30/hr UAW jobs into $18/hr non-union transplant jobs, or to write off our retirees because they become an inconvenience. We need a national plan for healthcare, and that will help with this, but the core of the turnaround strategy for the Big Three absolutely has to be consumer and product focused and not cost-cutting focused. Cost-cutting -- trying to solve this just by attacking the labor disadvantage or supply chain inefficiency -- is exactly the thing that has prolonged the death of these companies over the last decade. It has not helped them turn themselves around.
So I want to see a bailout, but I want it to be pretty brutal with the auto industry executives. They can go find a new line of work. I want to see the Big Three become great again. Without them.
The Times brought up the interesting angle on the impact on healthcare today. There are so many other profound consequences to hundreds of thousands of jobs being lost, and hundreds and hundreds of billions being taken out of the GDP.
My bitching is aimed more squarely at using this opportunity to induce long term reform among these three. I do want to see layoffs. Executive layoffs. Particularly at GM, there are a large number of completely useless executive level employees. They've got to go -- not because they're starving the company in terms of their labor costs, but because they're starving the company in terms of their utter inefficacy.
I don't completely disagree with the contribution that higher labor costs play in the Big Three difficulties. On the other hand, however, ten years ago, Ford was making billions in profit, largely on US sales, because they had the pulse of the market and they were making hot products. Granted, those hot products were bad for the environment, but they did evolve because of where the consumer was and not because Ford had some prestanding obsession with trucks. Ford stopped paying attention to customers right before they stopped making money. GM has never understood their customers. And Chrysler... /facepalm.
So I want to see changes that make the Big Three consumer focused again. And I want to see changes that put them on the long-term road to recovery. I sympathize with the labor cost issue, but I also don't think it does any great service to our country to continue to migrate $30/hr UAW jobs into $18/hr non-union transplant jobs, or to write off our retirees because they become an inconvenience. We need a national plan for healthcare, and that will help with this, but the core of the turnaround strategy for the Big Three absolutely has to be consumer and product focused and not cost-cutting focused. Cost-cutting -- trying to solve this just by attacking the labor disadvantage or supply chain inefficiency -- is exactly the thing that has prolonged the death of these companies over the last decade. It has not helped them turn themselves around.
So I want to see a bailout, but I want it to be pretty brutal with the auto industry executives. They can go find a new line of work. I want to see the Big Three become great again. Without them.
Its not about the companies, it about the people working for them, and its about the hit our economy will take with the lose of all these jobs. People will be broke, more companies will close(because less people will have money to spend), and the government will have to help more people out.
Bailout the big 3 is the cheapest and quickest way to fix out economy. We just need to make sure the money we give these companies has enough strings on it so we can be sure the big 3 spend it wisely and make good cars
Yup, health care costs are one of the major reasons why the Big Three moved most of their domestic assembly to Canada. I've been saying for years now that we'd get universal health care in the US when the big corporations demanded it. And lo and behold, that is precisely what's happening now.
I've gone back and forth on whether the government should rescue the automakers. A lot of their troubles are self-made (though a number were beyond their control). Philosophically I'm against it -- but this last employment report made up my mind in the other direction. It's the better of the bad options.
I've gone back and forth on whether the government should rescue the automakers. A lot of their troubles are self-made (though a number were beyond their control). Philosophically I'm against it -- but this last employment report made up my mind in the other direction. It's the better of the bad options.
Its a tough sale saying we should bail out these bums. Look at all the stupid stuff they do?
I couldnt help myself today and went to look at a new Challenger Base S.E. Model. The dealer has the gull to slap $4000 on top of the price as a " market adjustment"
In other words lets just be a greedy bastard and ask 4 more grand then the car is worth. Chrysler scratches its head and wonders why it cant sell cars. D.A.s. Do these guys really deserve a bailout?
I couldnt help myself today and went to look at a new Challenger Base S.E. Model. The dealer has the gull to slap $4000 on top of the price as a " market adjustment"
In other words lets just be a greedy bastard and ask 4 more grand then the car is worth. Chrysler scratches its head and wonders why it cant sell cars. D.A.s. Do these guys really deserve a bailout?
And if capitalism wins this case, it will further destroy this country's economy. It's not just about the people who work for the Big 3 losing their jobs, it's also the suppliers, etc. Sticking to the 100% free market, 100% capitalism, 100% anything will not work. There needs to be regulations, there needs to be some protectionism of ones industries, etc.
Don't hurt Me: Please realize the dealers are separate from the manufactures.
Its a tough sale saying we should bail out these bums. Look at all the stupid stuff they do?
I couldnt help myself today and went to look at a new Challenger Base S.E. Model. The dealer has the gull to slap $4000 on top of the price as a " market adjustment"
Dealers are not the manufacturers. In fact, dealers are hurting big time- thy can't get credit to finance their inventory and consumers can't get credit to buy/lease cars. We're in a vicious cycle here. Effing banks that took bailout money are still hoarding cash.
It would be remiss if people didn't know that we are subsidizing the Japanese manufacturers with US plants to the tune of hundreds of million of dollars in tax incentives.
Jacking up prices isnt going to help the manufacturers the dealers nor the banks. There is so much blame to spread around its a wonder they are in business, greedy CEO's and executives with golden parachutes, the greedy union doing sloppy work and getting paid when not working, greedy dealerships and greedy banks. GREED by everyone in involved.
Its why the taxpayers are bailing out wall street. Greed with no checks and balances.
Its why the taxpayers are bailing out wall street. Greed with no checks and balances.
The alternative you offer, in contrast, is like Nero playing his fiddle and watching Rome burn. Of course it feels good to say, "Screw you, greedy capitalists, burn in Hell." What exactly, however, is the historical precedent that allows you (or any of us) to predict what the consequences of this will be? Where else can you point in history when the government of a large nation with a dominant portion of the world economy can walk away from bedrock industries and survive as a nation?
and how long would this current talked about 17 billion bailout/credit last ? if you are lucky end of march ... .. how is this supposed to help if they (chrysler + Gm) need 11 billion in december to make it until january
don't forget that the other car manufacturers aren't sleeping either and quite a bit of them have plenty of steam to pull through a bad year with lots of rebates
just today on TV they estimated that next year prices for cars in europe will be around 10-15% less than this year (which was a rebate battle to begin with)
don't forget that the other car manufacturers aren't sleeping either and quite a bit of them have plenty of steam to pull through a bad year with lots of rebates
just today on TV they estimated that next year prices for cars in europe will be around 10-15% less than this year (which was a rebate battle to begin with)
We allways here about free markets, let the market decide etc,,, what happened to that one? Gm could have been building better small cars since the 80s and they choose not to. Bushco just a few years back was giving big tax breaks to companys buying the bigger SUVS. Congress OK's trade deals like letting Korea sell 600,000 cars here and they only allow 5,000 U.S. made cars. Its a srcew job and the U.S. tax payer/US worker is the pivot man constantly.
Nobody "deserves" a bailout. The banks that got one didn't deserve it -- they got themselves in trouble, even more so than the automakers. So what are we supposed to do, watch one major economic institution after another fail? Then when we're all living in cardboard boxes, we can say "they got what they deserved?" No thanks. The truth is, we'll get what they deserved.