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Automotive News & Views GM News, New Models and Market Share
8047 messages, Last post on Nov 08, 2009 at 10:53 AM
You are in the Automotive News & Views Forum. Your Hosts are steve_ & claires
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Replying to: 62vetteefp (Dec 01, 2008 9:22 am) You're also guessing that if GM goes under - 1) the plants wouldn't be restarted by someone else, and 2) the other manufacturers wouldn't get increased business in the meantime. Because the plants have value, there will be someone who will want them. Even if you only got $1M for an auto-plant, that is better then the alternative of $0! So they would be sold. I used to live near the Wang computer building. Digital Equipment another multi-billion $ company in the area was around then too. When there was a high-tech bust around 1990, both went under. I remember the Wang buildings, which were state-of-the art, the main 1 being 15 stories with a helicopter pad, sold for $640,000 at auction. The investor turned around, leased the space to other industries, and a few years later sold the buildings for $40M. The Digital buildings throughout MA were bought by Fidelity and others. So some organizations and peoples' loss were others gains. Hundreds of corporations, and tens of millions of people have been laid off over the years. It is not disaster. These people and facilities have all found new lives for the most part. Everyone involved within the Big3 family needs to get together and figure out how to make PROFIT NOW. They can do this, but they prefer not to make the cuts necessary, finding it easier to beg the taxpayer (as no bank or investor cares to throw their $ in). Also - take a look at how much Ford and GM have lost over the last few months and do the math. How long does $25B last? 6 months? Is that enough $ to make them get to profitability? Also if the Big3 get this money, how do they make enough profit to pay back the loans with interest. I would guess they need to pay back $6B/year over 5 years. Do the research and tell me when the last time GM and Ford made $30B over 5 years.
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Replying to: kernick (Dec 01, 2008 9:56 am) Not guessing. Experts in the field (independent from the big 3) have already said what they calculate will happen if one of the big 3 goes under. The entire supplier system shuts down in this country and production stops for up to one year of all assembly plants. You can disbelieve this or not. That is what they came up with.
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Replying to: kernick (Dec 01, 2008 9:56 am) Ford made a profit earlier this year. They're losing much less than GM right now, and are asking for a line of credit rather than an out and out bailout. This thread is about GM, don't try to bring Ford down with you.  It's a fair statement about how they'll pay these things back...I think that's why buying an equity state is preferable to a loan. I don't think GM stands a chance of paying their loan back...honestly, same with Ford, which is why I'm hoping they DON'T tap the credit line. Oh, you're forgetting Chrysler, which would have to pay back part of the $6 billion too. But then again, everyone always forgets Chrysler, as they should, 
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Replying to: gagrice (Dec 01, 2008 7:08 am)
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Replying to: kernick (Dec 01, 2008 9:36 am) No, capacity. The big 3 have shut down and are shutting down plants to reduce capacity. And sales mean vehicle sales which is correlated to capacity. If capacity goes down they build fewer vehicles. If plant closings keep going down and corresponding new plants are not built then sooner or later there is a crossover and the country will have under capacity. Of course since we dropped to 10,000,000 sales a year there is a lot of over capacity today. BUT once sales go back to 15,000,000 or even less than that there will be undercapacity.
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Replying to: 62vetteefp (Dec 01, 2008 10:12 am) Right now, they are shutting down plants to reduce capacity but they still have to pay the workers and suppliers. And you are selling fewer cars than forecast. And you have to have a $2000-$6000 rebate to move the product. It's no wonder they are losing money hand over fist. They need to break this business model to have any chance to make a profit. And the only was they can do this is bankruptcy.
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Replying to: dtownfb (Dec 01, 2008 10:27 am)
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Replying to: dtownfb (Dec 01, 2008 10:10 am)
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Replying to: dave8697 (Dec 01, 2008 10:58 am) You're right. There are more off lease cars available. You can get a used SUV for a song right now.... I think your situation is becoming more typical. Do i really need that new car smell or can I get by with a not so new car but be able to take the family to dinner at Chili's or Red Lobster on Friday or Saturday night? |
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Replying to: 62vetteefp (Dec 01, 2008 10:57 am)
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