Did you recently take on (or consider) a loan of 84 months or longer on a car purchase?
A reporter would like to speak with you about your experience; please reach out to PR@Edmunds.com by 7/25 for details.
A reporter would like to speak with you about your experience; please reach out to PR@Edmunds.com by 7/25 for details.
Options
Comments
But I think GM has made so many bad decisions over the years, to run a once great corporation with 50% market-share down, that they should use the George Costanza approach to management. Since basically every instinct they have has been wrong, they should do the exact opposite. Or let a monkey throw darts. Maybe the monkey came up with the "Pontiac is Car" slogan by putting those words in a bingo drum. That marketing team should have had their picture in the papers and basically black-balled for life from any job requiring thinking (would you like fries with that?).
I mentioned this concept over on the "Sales Stories" board a year or so ago and got blasted! The justification is that sales people provide a service when people who don't know what they want walk in to a dealership. Of course these are the very same people who usually pay more than those of us who hang out on Edmunds.
The concept of dealers who have an inventory worth millions sitting on lots collecting dust and accumulating interest charges is at best an old fashion business model.
I agree, go in and test drive the car(s) you are considering. Give a menu of motor and other options, check off the boxes and order the car. There can be someone at the dealership that qualifies them for financing and orders the actual car.
This is the age of the Internet folks!
Where am I wrong here?
Unfortunately your #1 is wrong. To do chapter 11 you need money from creditors. This in not available.
If GM does not get a loan soon it is chapter 7.
Yes and all the contracts the Big3 have also tie their hands. Since the current situation is not untenable you have the options of letting some of the Big3 die, having the taxpayer bail them out endlessly, or allowing the Big3 to file for bankruptcies.
Also remember when you quote "it's the law" in any matter, that laws can and are constantly changed and rescinded. Laws are not absolutes; merely majority opinion at any given time.
You are so right. Just rescind the laws about dealerships and suppliers. Let the companies remake their cost setups.
2014 Malibu 2LT, 2015 Cruze 2LT,
We have representative government and majority opinion doesn't necessarily mean something is going to pass or get repealed.
I could see Congress passing some dis-enfranchisement law, but only with compensation being paid to the dealers. Even then they'll all sue and that'll take a few years to work out. I think it's more likely that the Congress would tell the lobbyists that bankruptcy court is the traditional place to overturn contracts.
2021 Kia Soul LX 6-speed stick
:confuse: :confuse: :confuse:
I meant majority of Congress; just didn't think I needed to type it when referring to who passes laws. But Congress does usually listen to the majority of the population, though not so much after the election is over.
I merely want to point out to anyone here that quotes "that can't be done because of the law, or the contract"; that that is not true. Congress could pass a new set of laws, and yes people could challenge them by going to court, but it usually takes years to have a law ruled unconstitutional and overturned. In the meantime the new law is in effect.
• Jury members say Insignia “much more than style”
• Innovation, safety and comfort highly valued
Rüsselsheim. The Opel/Vauxhall Insignia was named Car of the Year 2009 (COTY) today by a panel of car journalists from 23 countries, recognizing the mid-sized car as truly revolutionary for the brand.
“Many jury members appreciated the looks and visual quality of this model but the new C/D (mid-sized) car from Rüsselsheim is much more than style,” the non-profit COTY organization said.
“Active and passive safety, comfort and a wide array of efficient engines characterize this model. The richness of equipment can be increased with sophisticated options such as the ‘Opel Eye’, that reads road signals, FlexRide suspension and nine-mode Adaptive Forward Lighting.”
Pardon my nitpicking, but I could just see a court in California doing just that a week after such a law passes, courtesy of the rather infamous 9th Circuit, and that could delay implementing the new law. The dealer lobby won't sit still for laws taking away their business. Plus the Supremes may chose not to step in after it all bogs down.
Chuck1, sure looks that way doesn't it?
Done .. sold their 3.x% stake for about $230 million.
Should pay for a day or two's worth of electricity.
2021 Kia Soul LX 6-speed stick
I can't believe the system works that way. For example you're saying that when Congress legalized abortion, all that 1 judge in 1 court had to do to delay the law is to disagree? No, I think the law is in effect until such time as the Supreme Court decides to hear and rule on the law.
A good example of this might have been the dispute between some counties in the South making laws and rulings during the 60's on segregation, and the Feds sent in the FBI and army to enforce the federal laws of Congress.
It's called an injunction and yes, that is the way it works. An injunction is issued by a judge who then sets a date to have a hearing. This is usually done because someone is claiming the new law violates existing law. The judge has to find that it is likely the claim is true before approving an injunction though.
The Prop 8 anti-gay-marriage thing in California is just such a change right now - it is under consideration for an injunction, and if it gets one you can expect THAT legal battle to go on for years.....
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
But yeah, it's not a given. You have to find the right court and right judge - that's why I mentioned California. Anything could happen there.
In other news, Chrysler Supplier Getrag Files Bankruptcy.
"It may be the first of many such bankruptcies as a study by the Center for Automotive Research in Ann Arbor, Michigan, predicts a wave of supplier bankruptcies if one or more of Detroit's automakers cease operations."
"There is only about a year before the Volt goes on sale in 2010. And, with GM financial woes looming, there is a lot at stake here."
-Rocky
When President Dwight Eisenhower observed that America's greatest strength wasn't its military, but its economy, he must have had companies like General Motors and Ford in mind. Sitting atop a vast pyramid of tool makers, steel producers, fabricators and component manufacturers, these companies not only produced the tanks and trucks that helped win World War II, but also lent their technology to aircraft and ship manufacturing. The United States truly became the arsenal of democracy.
During the 1950s, advances in aviation, missiles, satellites and electronics made Detroit seem a little old-fashioned in dealing with the threat of the Soviet Union. The Army's requests for new trucks and other basic transportation usually came out a loser in budget battles against missile technology and new modifications for the latest supersonic jet fighter. Not only were airplanes far sexier but they also counted as part of our military "tooth," while much of the land forces' needs were "tail." And in those days, "more teeth, less tail" had become a key concept in military spending.
But in 1991, the Persian Gulf war demonstrated the awesome utility of American land power, and the Humvee (and its civilian version, the Hummer) became a star. Likewise, the ubiquitous homemade bombs of the current Iraq insurgency have led to the development of innovative armor-protected wheeled vehicles for American forces, as well as improvements in our fleets of Humvees, tanks, armored fighting vehicles, trucks and cargo carriers.
In a little more than a year, the Army has procured and fielded in Iraq more than a thousand so-called mine-resistant ambush-protected vehicles. The lives of hundreds of soldiers and marines have been saved, and their tasks made more achievable, by the efforts of the American automotive industry. And unlike in World War II, America didn't have to divert much civilian capacity to meet these military needs. Without a vigorous automotive sector, those needs could not have been quickly met.
More challenges lie ahead for our military, and to meet them we need a strong industrial base. For years the military has sought better sources of electric power in its vehicles — necessary to allow troops to monitor their radios with diesel engines off, to support increasingly high-powered communications technology, and eventually to support electric propulsion and innovative armaments like directed-energy weapons. In sum, this greater use of electricity will increase combat power while reducing our footprint. Much research and development spending has gone into these programs over the years, but nothing on the manufacturing scale we really need.
Now, though, as Detroit moves to plug-in hybrids and electric-drive technology, the scale problem can be remedied. Automakers are developing innovative electric motors, many with permanent magnet technology, that will have immediate military use. And only the auto industry, with its vast purchasing power, is able to establish a domestic advanced battery industry. Likewise, domestic fuel cell production — which will undoubtedly have many critical military applications — depends on a vibrant car industry.
To be sure, the public should demand transformation and new standards in the auto industry before paying to keep it alive. And we should insist that Detroit's goals include putting America in first place in hybrid and electric automotive technology, reducing the emissions of the country's transportation fleet, and strengthening our competitiveness abroad.
This should be no giveaway. Instead, it is a historic opportunity to get it right in Detroit for the good of the country. But Americans must bear in mind that any federal assistance plan would not be just an economic measure. This is, fundamentally, about national security.
Wesley K. Clark, a retired Army general and former supreme allied commander of NATO, is a senior fellow at the Burkle Center for International Relations at the University of California at Los Angeles.
-Rocky
Just what will it do for GM in the USA? Most expensive component the battery will be built by Hitachi. Most likely in China.
General Motors hasn't committed to a projected retail price for the 2011 Volt yet. We expect it to fall somewhere in the mid-$30,000 range, with loaded models north of $40-grand. Considering the developmental effort required to bring the E-Flex platform and the Chevy Volt to production, that price point is likely well below actual cost until technology efficiencies and production volume can bring costs down. We look at it as no less than a major investment in the future of personal transportation - GM's century maker.
North or $40k and well below cost. So how is GM going to pay US back the Billions they are wanting to BORROW?
About 3 years ago I was in a Business / Project Management program with some folks from Sylvania, and the horror stories of quality demands and price cuts from the auto manufacturers were making the business already untenable. I remember several of our teachers saying that the worst companies dealt with the government, and the 2nd worst was those that dealt with the auto industry. The point being is that if you could get any other business you would; before you'd deal with these guys.
Ford, GM, and Chrysler has squeezed many of the suppliers so much over the years, in order to keep costs lower, that now they have no reserves to whether a storm. The Big3 ate their food, ate their seed, and now there's a large storm.
And people who are making $20/hr or so if lucky, and lucky to have health insurance are supposed to subsidize the UAW and the people of MI? because they have no idea what else to do to make a living? It sounds like the CEO's of the Big3 and your elected local politicians need to earn their $, and figure out how to deal with change. It's not the rest of our faults if you put your eggs in 1 basket.
Is this a story in MAD magazine?
2021 Kia Soul LX 6-speed stick
http://www.marketwatch.com/news/story/SolarWorld-offers-buy-four-GM/story.aspx?g- - uid=%7B01B4E36B%2D762B%2D4225%2D8B7B%2DD27D6153C82C%7D
Your link doesn't work.
2014 Malibu 2LT, 2015 Cruze 2LT,
Although the loans are still risky, usually that's not a huge issue since the lender will get preference in the bankruptcy and will be first in line to get repaid whether the reorganization works out or not. But in this economic climate, lining up that financing may be impossible without government intervention.
It doesn't sound like GM and Ford have convinced Congress that they have a plan in place going forward. More trouble for auto bailout
Otherwise they end up in chap 7 very quickly.
Partly true, but I also see that the financing wouldn't be coming from the banks or the issuing new stocks or bonds because they think it is a very risky and poor investment. Let's role play; say you're the head of Citicorp and the government has funded your bank with part of the $700B. Say you (Citi) received $30B. And GM's share of the $25B being asked for, is $12.5B.
OK. So now it's your job to decide whether to give GM $12.5B. You're going to give them a 4% loan, to pay back in 5 years. You look at how fast GM has been losing money (is it more than $2B/month now?), and you look at what their plans are - product plans and their cost-cutting plans. If you give them $12.5B, that's enough for 5-6 months the way things are going (the economy doesn't look like it's going to be much better by then), what then?
Not only does GM have to stop losing $2-3B/month they have to start making money, to repay the loan. And during the next few months health-care is going to increase, the pensioners may get a cost-of-living increase ...
GM also will not have reserves to weather any sort of strike. What if one of their union suppliers decides to strike, demanding a wage increase, which shuts down all of GM a few days later?
The banks and markets have already analyzed this and determined that it is far too risky to deal with the Big3. It is not just a matter that no money is available; it is a matter of investing in companies that will make you money and are likely to repay the loan!
So that leaves either a government bailout or liquidation or partial sale/liquidation and try to keep a core business going?
5 Years!! 5 Years!! What exactly are you thinking you are paying them for? Just because top executives got that scam of a deal, doesn't mean everyone could get that. I don't have the numbers, but you're talking about paying 150,000 employees, $250,000 each or $37.5B total, and then paying to hire new employees and keep the companies producing!
Wow, that is the worst idea for the taxpayer I've heard. It only could be topped by declaring this a national emergency and thus having our fed. emergency group - FEMA - put in charge.
Then that's what should happen. Hopefully GM goes first and C and F can gain market share. I call BS on the magnitude of the gloom and doom if GM fails. Pain in the beginning but then the market will adjust. We shoul not reward 30 years of miserable failure on GMs part. And Wagoner must go.
As a taxpayer I'm willing to take the risk. What will result is more COMPETITIVE survivors.
Their political influence and claims on the company books. It's basically a one-time "go away" offer. Take the money and run, or hope the Republicans don't lock you out after the next election.
I don't want to see it, but after watching the hearings, I have zero confidence in GM. I think Ford has a chance. Ford has certainly made very poor decisions over the year, it seems that they at least have a plan to survive. Things were improving for Ford until the credit mess developed.
My view is this needs to happen fast because the plans for all 3 under the current structures will fail.
This alternative will be the best use of funds and will protect the new entity and the workers that will become more secure under a new corporation, including suppliers and whatever dealers that survive in the network.
The problem is the current management is resisting this and have no plan which is a protective mechanism to keep status quo. Nice ploy but I'll bet the taxpayers see right through this.
The devil is in the details so a fast approval without negotiated mandates and hurdle rates is a supreme waste of funds.
Regards,
OW
Regards,
OW
This tells me that if GM were gone by the first of February, everyone else in the industry would all be doing just fine. The feds should use the bailout money to guarantee payment of Little 3 debts to suppliers (currently $28 billion in GM's case), and just let the bankruptcy court do its thing.
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
The only question is who will buy their assets?
-Rocky