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Why would it be? VW is already selling a very nice 5 passenger car that is getting 50 MPG on the highway. GM sells cars in the rest of the World that get good mileage. Why have left them over seas? They have needed a car to compete with Toyota and Honda hybrids for 8 years. NOTHING has been put on the dealers lots.
By the way, VW is only down 2% for the year. The Jetta TDI is selling at 17% of their total sales. It proves again. Give the people what they want, not what some arrogant CEO thinks they want. The Volt is a joke in my book as the savior of GM. How will they make money when they will be selling them below COST?
When was the last time GM was first, when Oldsmobile introduced the automatic transmission?
Making this statement relevant to a bailout discussion is way out there IMHO.
But Ford at least has real leadership, has made actual plans and is moving relatively quickly.
GM on the other hand is the very story of NOT taking a worst case scenario approach:
- No contingency plan for higher gas prices
- Can't make money in good times, no contingency plans for an economic downturn
- Believes that some Union concessions are a substitute for consolidating a bloated set of offerings
- Has a Board that retains Wagoner but didn't want to hear what York (who was much more realistic) had to say
GM is a pathetic example of American industry and the sooner the few good pieces can be dislodged from the heaps of poop the better.
Some make bad decisions and then feel the consequences are not their fault so they deserve income others have earned just because, well, just because they feel they deserve other people's money.
Eh?! ;-)
62vette: I can't see a 2013 Chevy Beat being a game changer, no. By then several more Asian companies will have brought their microcars to market here according to their current plans, all of which are projected to exceed 40 mpg combined, and Ford's own Fiesta should be a strong rival in this category too if they can get it here before they go broke.
The other thing is, this is just one more in an endless string of announcements by GM of things it will do to "change the game" YEARS AND YEARS from now. Who's to say this one will be any more realistic than all the others?
On the brighter side, news on the radio this evening is that Wagoner is going to drive to the hearings in a Volt? Is that true? Nice bit of PR if so.
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
Certainly more than the Volt will be, if it is an excellent car. It needs to be as good as the Honda Fit. Just having a small car is not enough (witness Aveo).
From Wikipedia: "On July 3, 2008, it was reported that General Motors will shift its Chevrolet Beat concept car to the U.S. market. [7] However, it was later reported on July 15, 2008, Robert Lutz, Vice Chairman of Global Product Development, indicated the Beat would indeed not be sold in the United States. He cited that the Beat had not been designed to meet the safety requirements of the United States."
It would also be more of a game-changer if it was a 2010 instead of 2013. Why does it take 5 years? This car is a derivative of an existing Daewoo. There's a competitiveness issue right there. Company is dying, needs more diverse offerings, and it takes five years to bring a car with no major new technology to the US ? How pathetic is that?
The automakers had an opportunity with the request to provide detail about their plans for federal funding to go in a new direction with their turnaround plans. What much of the country outside the "Rust Belt Midwest" does not understand (and
has not really had communicated to them) was that the domestic automakers began taking steps to put themselves on the way to recovery two years ago, before a confluence of events outside their control basically took away their revenue
streams.
Stop. Right here is the entire problem. GM sees this as a problem not of their own making - an error in an otherwise decent scenario.
"It's not my fault"
"This is just a temporary setback"
"I have a plan - it'll work for sure..."
What does this sound like? Correct. A gambling addict. Always something else at fault, always needs another fix, and always is sure that it's not their problem in the first place.
GM and Ford fail to see that their management is the problem. This isn't a thing beyond their control. They ran their companies right into this iceberg and didn't care. After all, GM is too big to fail(insert "Titanic" and "sink" to complete the mental image).
GM and Ford? As long as those divot-heads are still in charge it'll be money down the drain.
I mean there is a lot of this "I deserve this...", "You have to support me ..." "The dog ate my homework ..." "Well my friends got this from their parents ..."
It's really dismaying to see so many adults act like children; and then when you point this out to see they don't have the pride to make their own way in life - supporting themselves, instead of blaming others.
The question this prompts me to ask is couldn't GM just sell its remaining interest in this plant to Toyota? That would be a great way to raise a little cash I would think, especially since 3/4 of the plant's output has been Toyotas for years and years now.
2014 Mini Cooper (stick shift of course), 2016 Camry hybrid, 2009 Outback Sport 5-spd (keeping the stick alive)
I understand, but youre probably missing my point too imo. Currently all major plants from large brands are capable of producing 30% more than what the market can absorb. Only a few plants across the globe are working at 100% capacity. Most manufacturers wont need any new employees, not anytime soon. And the loss of GM doesnt necessarily mean competitors will raise their demand for parts, or at least not high enough to recover the loss of demand from GM.
Another point is when some company finally buys whatever is left of GM or other Detroits, they will most likely cut capacity in half or even more. Curently GM is already overemploying, with too many plants running so inefficiently that their production cant recoup the operational costs. Also dont forget GM has way too many dealers, and new owners wont reopen even half of them. It's like 1 million jobs go bye-bye and only 500 thousand added, its still a negative in the equation.
nippononly, is it just me or GM is pulling the "THREAT" card???? I'm against the bailout myself, but oh well, apprently congress agrees. Can't blame them though, even if GM goes chap7 or 11, no matter who or which company buys it it will be downsized, meaning there will be less jobs for these people.... ah, crap I dont like both ideas.
"So I take it you think they should kill the Volt? "
Kill the Volt? depends. They should calculate the production costs and see if there will be enough profit for GM to at least recover some development costs. Otherwise, forget it and just kill the Volt.
"We'd be a lot further along in re what we could do and should do to save our auto industry from further damage from the imports. "
Thats not fair. I'm not taking sides, but America's essentially about free competition. Further damage from imports? Thats competition, by all means. Strong ones live, weak ones falter. That simple... I dont care if only one domestic brand remains in the end, as long as its competent.
Even at 40 thousand bucks a pop, GM is looking at the Volt as an image builder but producing no profit at all for at least 2 years when they can impliment it inot other products.
So by the magic number of 2013, GM will lead the way in hybrid vehicles. I really think they can, as long as every other manufacturer out there takes a 4 year holiday in the meantime. :sick:
By then? No, my friend. Right now Honda already got the marvelous 1.5L i-DSi engine (actually its been sold outside US since 2003). Placed in Honda Fit, combined with CVT tranny, it manages to achieve stellar 25km/l (about 55mpg), or in Honda City (subcompact) where it achieves 22km/l. The same engine is already categorized as "green" in Europe. From what I see the reason its not sold in US yet is simple: it makes only 87hp. However considering the market's rising demand on fuel efficiency I guess it wont be long before Honda offers them in US and kill the upcoming Beat.
If they cut production does that not increase the legacy costs per vehicle. Making it even more difficult to sell the higher priced vehicles that are left? Downsizing the models only increases the cost for the ones that are left. GM has themselves in a pickle. I don't see a bailout helping them at all.
Gotta wonder if the Tupelo plant will get pushed back a year or two - if GM got out of the NUMMI joint venture and sold the plant to Toyota, that might make sense.
No, I understand that. You are correct. But the slowdown in auto-sales is not the result of GM or the Big3 needing funding or near bankruptcy. That is a whole different issue and cause.
The reason for the slowdown in auto sales is due to the economy. And there will be a certain number of layoffs whether the Big3 are here or not. If the prior 16M in sales employed 2M people, then the 12M or so now being sold, only require 1.5M people. There are going to be 500,000 layoffs no matter what. This reduction in the number of workers may not be spread evenly, as the weakest may fail, thus shifting work to others (an analogy might be the lion getting the limp antelope, while the rest of the herd escapes and prospers).
What many of us are against is the U.S. taxpayer coming in and giving tax$'s to any of the manufacturers such that they are subsidized - keeping workers that are no longer needed, to produce vehicles that are no longer wanted.
It is the CUSTOMERS who decide ultimately, and it is up to companies like GM to make products customers want, and make those products for decent costs - not pillaging the coffers over the years.
It's like 1 million jobs go bye-bye and only 500 thousand added, its still a negative in the equation.
Homebuilders, and Citibank and the rest of the financial industry are going thru this too, as demand goes down. The computer and defense/aerospace industries went thru this 15 years ago. The government can not bailout each one, or else what you end up with is an economy where every industry has extra workers producing products that are not needed or wanted!
Industries that are technologically obsolete must fail! Companies that are poorly run must fail! Recessions are just like storms, felling the rotten trees. And guess what they fertilize the new growth of the forest. Wow - I'm getting corny today
Here's GM's Restructuring Plan for Long-Term Viability (pdf file)
Industries that are technologically obsolete must fail! Companies that are poorly run must fail! Recessions are just like storms, felling the rotten trees. And guess what they fertilize the new growth of the forest. Wow - I'm getting corny today
That I agree. I'm just pointing out how sales may or may not see less demand from the loss of GM. Nothing to do with bailout whatsoever.
Why do you think youre getting corny? I actually feel the same way :P Survival of the fittest, one may say. That said, like I mentioned once, I'm against bailing out the D3, however should the congress finally decide to do so I can still see why. Its called fear of uncertain future. Thats all...
These are not children. They are adults, who are competent and thus are expected to be able to change and adapt. as all adults have thru the history of layoffs and industries crumbling, THEY choose if they work somewhere else and what what they do. Or they can start their own business. It is not the government or my obligation to ensure anyone's happiness, and tuck them into bed everynight. The government only states the right to "pursuit of happiness".
If you personally wish to help GM or the UAW, or the other 40% of the population who support help to GM, you guys are free to organize and loan them the $. :P Let us know how much you're sending.
We need your philosophy applied to many people currently on welfare. Have you told them we shouldn't be supporting them?
2014 Malibu 2LT, 2015 Cruze 2LT,
Just checking....
2014 Malibu 2LT, 2015 Cruze 2LT,
That would have to be known in order to figure out revenue and profit. Did GM put in there that their marketshare would be the same as now? even after discontinuing models of Pontiac, and closing Saturn? Since the trend over the years has been GM losing marketshare year after year, and this debate not helping, what numbers did they use for '09, '10 and '11? Does anyone see that?
I bet they used the same as '08, or higher, to make their profit-chances look better.
Speaking of betting, anyone want to take me up on a steak-dinner bet, my or your choice; that if they get this loan to survive a few months, they'll be back for more money before 2012?
Very good point. I cannot find it anywhere but they did calculate lower than 20% share for the assumptions.
I heard today upwards of $200B could be the amount necessary to make a meaningful restructuring to a good business model.
Regards,
OW
People seem to forget that many people can't get loans to buy cars and if you can't get a loan you can't buy a new Chevy!
I predict they'll be back before the end of 2009.
Yet 2 months ago we were badmouthing GM for not turning their $60 billion dollar enterprise on a dime and immediately switching from making pickup trucks to churning out Prius like hybrids like there is no tomorrow. We are lousy Monday quarterbacks it seems.
I wonder if being able to drive a large truck to a 15 mile away job for less that $3.00 a day, round trip, has something to do with that reduced willingness to shell out an extra $5,000 for higher efficiency of a hybrid? If this Economic crisis is going to last a few years and $4 gas destroys the world as we know it, will the regular people ever buy Prius's if gas gets parked at $2 for the next 3 years?
GM may already have the right product mix plan. This crisis caused mostly by coastal region home loans and the coastal based bankers has destroyed all of our country. All businesses are suffering. GM is offering to attempt to retain automotive development capability in the US, if the gov't is willing to help. This crisis is a golden opportunity for GM to finally get thrown a few bones by the unions. Whether anything besides Walmart (Read 'Chinese manufacturing') in this country survives this crisis will depend on many risky factors, so don't demand that the ONLY miracles are to come from Detroit, and don't expect the $700B bailouts to guarantee a miracle for any of the bailed out enterprises or our country as a whole.
I listened to an interview with the mayor of Dallas and his methods for bringing in companies and jobs. He is noted for stealing several large companies that were disgruntled with CA taxes and overbearing regulators. If Philly is not actively seeking these companies. They are not going to just come there on vacation and decide to relocate.
Did you post about the Allison hybrid Bus? GM sold them in 2006. They must have been a money maker and Wagoner just could not tolerate having a division that looked better than the others.
Wagoner belongs down in Santa Monica pushing a cart with the rest of the homeless. I wonder how much he has stashed from all the sales of lucrative GM holdings.
To respond to Kernick. I was raised to understand you don't work you don't eat. My stepfather was still driving school bus in NM at age 75. He was never able to save enough to retire. He worked hard just surviving. He did teach his children a good work ethic and most of us are doing ok. None ever on welfare.
As if. These three aren't the majority, even. Not any more.
BMW
Honda
Hyundai
Mazda
Mercedes-Benz
Mitsubishi Motors Corporation
Nissan
Subaru
Tesla Motors
Toyota Motor Corporation
VW (soon - three new plants planned)
Most of the U.S. "Auto Industry" now is actually imports! In case nobody was looking, GM and Ford have moved many of their plants to Mexico and Canada.
Plenty of jobs. After all, Toyota will likely just buy a fully working GM plant instead of building one from scratch. And that plant will need people to run it. And VW, BMW, Mercedes...
I heard today upwards of $200B could be the amount necessary to make a meaningful restructuring to a good business model.
I heard it was $500 billion at the barbershop.
Do you have any data? I would think that is incorrect. GM MAY be 10% imported from outside of US. Toyota is about 50%. Ford is probably close to GM. As is Chrysler. Right there is probably 50% of the US and then you have all those other plants you listed.
GM and Ford have moved many of their plants to Mexico and Canada.
GM has 3 plants in Mexico and 1 in Canada. Hardly "many".
Assembly Plants
Arlington: Arlington, Texas
Bowling Green: Bowling Green, Kentucky
Hamtramck: Detroit, Michigan
Doraville: Doraville, Georgia
Fairfax: Kansas City, Kansas
Flint: Flint, Michigan
Fort Wayne: Roanoke, Indiana
Janesville: Janesville, Wisconsin
Lansing Delta Twp: Lansing-Delta Township, Michigan
Lansing Grand River: Lansing, Michigan
Lordstown: Lordstown, Ohio
Moraine: Moraine, Ohio
Orion: Orion Township, Michigan
Pontiac: Pontiac, Michigan
Shreveport: Shreveport, Louisiana
Spring Hill: Spring Hill, Tennessee
Wentzville: Wentzville, Missouri
Wilmington: Wilmington, Delaware
Ramos Arizpe: Ramos Arizpe, Coahuila, México
Silao: Silao, Guanajuato, Mexico
San Luis Potosí: San Luis Potosí , San Luis Potosí, Mexico not exported to US
Toluca: Toluca, Mexico State, Mexico
Oshawa Oshawa, Ontario, Canada
Who believes oil will stay at the present level it's at?
Regards,
OW
That's a rather open-ended question. Be more specific on timeframe. The head of Gulf was on the news last night, and he said in the next few weeks you can expect to see gasoline to hit $1.00/gal in some areas of the country. Who knows after that? OPEC might stop nibbling at cuts, and cut 25% to bring back $100bbl/oil, which if you do the math would be a good volume-price scenario for them.
Anyway as one financial analyst pointed out last night, all this discussion of new vehicle plans, and good intentions of the Big3, and repentence is moot and irrelevant. Congress and the concerned taxpayers want to know how the Big3 is going to make $ - enough money to repay the loans.
The plan from GM that Steve posted didn't even give enough detail to figure out how much market-share were in GM's estimates! After they close plants, shutter Saturn and Pontiac, sell Hummer and Saab, and maybe sell Opel to Germany, how many cars are they going to sell?
Also with the current economic environment, and the fact that Toyota and Honda can produce cars cheaper, what if Toyota and Honda CUT prices to get back their volume. Does GM's plan consider that its rivals are not going to sit still? - their strategy will change to survive and prosper too.
For GM or any of the Big3 to sit there and say they have faith in these future-year estimates would be ridiculous, as this year has shown that experts in all fields have no idea and control of these interrelated factors in the global economy.
Any of the Big3 who would want a loan would have to show me a plan that gets them profitable in 3-6 months. You might say "they can't do that, they have contracts with A, B, C ..." Well I say to that the parties with the contracts can rip them up today, and write a new one tomorrow. The Big 3 need to get together all (dealers, suppliers, UAW, salaried) concerned and say "The situation is this - you've been getting $50, we can't afford that, you need to take $30; the alternative is $0. Would you rather continue to get $30 or $0?" "We pull in $4B/month right now and that is what we can afford to spend. We write all the expenses down and then we start crossing things off. If we don't agree on getting to the $4B then we're closing up. This is Armageddon for us, or we figure out how to survive. And if revenues go down to $3.5B then we'll see you folks back here next month."
If GM took that business approach, I bet there might even be some banks willing to loan them $. And people who would feel better about buying a car from a company they knew would be in business at least for a few years, and one you could be proud of - not being on welfare.
The guys buying the Trailblazers, Hummers, and Vipers. :shades:
1:09pm: Sen. Shelby is pressing Zandi on his $75 billion to $125 billion estimate. Zandi said he is skeptical about the $34 billion total number because his expectations for total vehicle sales and the domestic's share of that total market are lower than what the automakers have laid out. Others have also pointed out seemingly rosy projections for foreign sales growth in places like Russia, where GM is expecting robust growth despite falling oil prices, as a reason to worry that more cash might eventually be needed.
12:53pm: Mark Zandi, chief economist for Moody's Economy.com, warned Congress that successfully restructuring the auto companies is likely to take a lot more cash than the $34 billion in loans they have requested. By his estimate, the price tag will likely be between $75 billion and $125 billion over the next two years.
Still, he said the bailout might be the best option. "Without any government help, the Big Three will quickly end up in bankruptcy and be effectively liquidated, resulting in hundreds of thousands of layoffs at just the wrong time for the sliding economy," Zandi said.
Zandi suggested the money be provided in a series of tranches, with the first being enough to stave off a bankruptcy filing and then the remaining cash made available only if the companies' restructuring plans are showing signs of working.
Regards,
OW
sadly, OW, a lot of people. SUV sales start creeping back up when the gas hit below $2/gal. So many narrow minded people out there. And the next time gas shoots up again they'll start crying screaming and protesting again... We're so F'd indeed... :sick:
American automobile companies that are building an impressive array of class-leading vehicles in all segments, with more on the way with each passing quarter.
Now this is ridiculous, I'm laughing so hard blood came out my nostrils. Class leading vehicles??? Where??? Cutting edge fuel efficiency? What, Volt? Fuel efficient, maybe, but not wallet friendly in many other ways for sure.
Then there's all these talks about making/producing class leading vehicles in every segment. Wake up, darn it. Who cares about being best? I say focus on making vehicles that WILL SELL, to hell with what magazines and reviewers say. Take the best example: Toyota Camry is almost never considered best at anything by any reviewers and auto mags, yet its the best selling sedan in US.
"Some are trying to get money so they don't have to work to support the lifestyle they have chosen. "
People doing this should be embarassed of themselves. Want more money put dont wanna put anymore effort? Thats childlish at best, idiotic and low at worst.
"In far too many cases around here the goal is to get extra money from someone else's work; income redistribution"
Both true and disgusting.
Are you moderating this forum now? You can't handle a post that long? You lose attention?
m4d - good post. Let me add the issue here is not the Volt, or what products GM makes now and how good they are, MPG, environment, or what happened 5 or 20 years ago, or who's fault the economy is, or why are we bailing out the financial industry.
What matters is: how does the Big3 plan on taking this $34B, and before it runs out - becoming profitable, and profitable enough to repay the loan. Will the Big3 a) make cuts fast enough, and b) earn enough; before they blow thru this money?
The plan I see is no because the big cuts are 1-2 years away. And the 30-year history of new products that will increase market-share is: that the Big3 have been wrong, and they continue to lose market-share.
For such a dying company, 40 is way too many. The decision to convert Pontiac into a niche brand is stupid imo, who will ever consider Pontiac a niche? I say they only need about 20 models.
Chevy:
Aveo (need a redesign)
Cruze
Malibu
Impala (rebadged G8, if it must exist)
Traverse
Captiva (as Equinox replacement)
Corvette (limited production)
Camaro
Solstice (rebadged Pontiac)
Minivan (whatever the name)
Large van (Astro???)
Silverado
*All SUVs, trucks and vans can use GMC badge if necessary, kill the Chevy versions.
Cadillac
CTS
STS/DTS replacement (flagship midsize)
Entry level (perhaps a redesigned LaCrosse)
Escalade
SRX (redesigned Lambda)
CTS coupe
(roadster - easily based on Solstice platform)
Hummer (niche brand)
H2
H3
-all limited production, kill SUT. focus sales overseas