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8631 messages, Last post on Dec 06, 2009 at 6:18 PM
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Replying to: 62vetteefp (Dec 02, 2008 6:12 pm) Yes! Good god! It sounded good 3 years ago, but the closer to reality this gets the more of a turkey it becomes. I mean, really, what possible value could it have to GM? A halo effect? That's worth billions in development and marketing costs? It will never make money if it ever gets made in the first place. |
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Replying to: tlong (Dec 02, 2008 9:31 pm) They see this as an unfortunate problem and a temporary obstacle. They fail to see that it's really a symptom of decay and ruinous policies that infests the entire management of the company. The proposal is a complete joke.
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Replying to: plekto (Dec 02, 2008 10:10 pm) True. But is it good enough to pass congress?
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Replying to: obyone (Dec 02, 2008 11:56 pm) There was an article in the L.A. times opinion section about this, where it was suggested that since the Government is basically taking control over much of the company, why not do the right thing and buy out the company entirely? The Government will end up having to take over the pensions and health care of the workers anyways when GM goes under in a couple of years, so that part of the equation is pretty much a moot point. That leaves the value for the money. GM is only worth $10 billion or so right now, and that's less than they wold waste in the next year on frivolous garbage. What would we gain? The article pointed out that it would fit well with Obama's desire to reshape our energy policy by making vehicles at cost and to fill a need rather than to pollute and make a profit. Losing a coupe of billion a year is far better than throwing 50 billion down a toilet and delaying the inevitable, after all. |
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Replying to: cooterbfd (Dec 02, 2008 7:12 pm) Also consider the number of states that GM and Delphi are in. What have the STATES offered them? Or the CITIES - maybe in the form of tax breaks? If the people of MI and OH ... desperately need the Big3 - what are they doing? Maybe they can't provide all the support, but are they doing anything extra in the last 3 months? has anyone heard? Is MI issuing $5B in bonds or anything, and lending to GM? No? Why not? |
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Replying to: kernick (Dec 03, 2008 5:48 am) That would work in normal times where the lobbyists and their cronies (congressfolk) hadn't messed up the financial system to the point where banks aren't lending the money that the FEDS just gave them to lend. Instead they're using it to bolster their highly over-leverages loan portfolios and are investing it in treasuries. >vIf the people of MI and OH ... desperately need the Big3 - what are they doing? I just saw a list of things that other states, three, had done to "win" (bribe) the foreign makers to build their plants in their nonunion states. As for Ohio and Michigan, we have tried to "lure" (bribe) the companies to build here but are discriminated against because of a higher union reputation and having US manufacturers plants in the area. The article I just read pointed out a Mercedes plant in AL that cost their taxpayers $200,000 per job. In Ohio the painting/body plant that's closing in December was given taxfree status a few years ago so that GM would upgrade the plant and continue to build and assemble the vehicles here. The jobs lost through the last years in those areas means the states' incomes are dropping. Granting loans and floating bonds to give more to the companies to make up for the damage caused by federal government laws and by buying of plant's locating in their states by other states isn't possible. EDIT: Ohio needs 5 Billion Ohio's Strickland helped campaign for BO after he campaigned for Hillary. He even had state employees doing campaign work on state time violating laws of privacy .
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Replying to: imidazol97 (Dec 03, 2008 6:05 am)
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Replying to: gagrice (Dec 03, 2008 6:14 am) But new revenue numbers released Tuesday show the state tax haul is running about $70 million behind projections. State budget officials have instructed agencies to hold back 7 percent of their appropriated spending; a few building projects have been postponed and hiring is being closely scrutinized. But it's the new biennial budget legislators have to craft starting in January that will be even harder as Indiana takes in less revenue than the year before, leaving no room for inflationary growth. "We are going to have a very austere budget," Daniels said. link title |
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Replying to: imidazol97 (Dec 03, 2008 6:05 am) I don't believe that banks aren't lending ANY money to companies, or to consumers. Less is being loaned, as banks now are only willing to lend to good companies and consumers with a good probability of paying it back. Granting loans and floating bonds to give more to the companies to make up for the damage caused by federal government laws and by buying of plant's locating in their states by other states isn't possible. News alert - the federal government is over $10T in debt. They're more broke than the cities and states. And I just posted links this morning that Detroit gave the Tigers and Lions $300M in the last few years to build stadiums. http://oversight.house.gov/documents/20070329144701-85817.pdf NY is currently giving the Yankees $833M to help with the Yankee Stadium project. |
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"...once sales go back to 15,000,000" Honestly, vette, do you still believe that GM will ever get back to 15 mil annually? GM can still manage 10 million right now simply because they're practically giving away their cars for barely any profit, if not none. As more and more customers will become educated in the market, GM will lose sales even more. I have mentioned this many times, GM is relying too much on 1) very few competitive products, and 2) the tired old "buy American" cliche. Whats with insisting on 15mil annual sales anyway? Forget getting back to 15 million, GM will have to figure out how to retain less but more profitable sales instead of just numbers. Simply thinking of the number of units sold is exactly what will make GM plummet even further. "It just doesn't happen, as the world works on an equilibrium. If 12M vehicles are in demand here in the U.S. 12M will be bought and sold, no matter who's nameplate is on it. The market is very efficient in that respect. " This is one thing I disagree with you, kernick.. I believe GM going under will affect sales and demand in 2 ways: Demand changes due to the loss of GM cars From the survey data I read in MT, the top reasons for choosing imports are higher reliability and resale value, whereas top reasons for choosing domestics are cheaper price (and better incentives) and the wish to buy American. Here's my prediction: 1) Should GM go under, most customers seeking price will look elsewhere, like to the Koreans and other Japanese. Others will stick to domestics. 2) Some fraction of the buy American customers will convert to something else, being non-loyalists and in need for a new car. 3) Some of the persistent domestic brand customers will be served by Ford (Chrysler is a goner imo). 4) The last group will be GM loyalists, which will probably choose to keep their current cars as there's no GM replacement. So in the end the market will only lose demand from GM loyalists, and lets face it, there aren't enough of them to hurt demands significantly. Whats more, this drop in the market won't last long as GM assets will be purchased, plants re-opened, and in a few years there will be new GM cars for the loyalists. Demand changes due to customers' financial condition The fall of GM will cause approx. 1 million people to lose their jobs. This will at least affect our economy, meaning there will be less demand as some buyers can no longer afford a new car. And when/if someone or some company buys GM, they will most likely cut capacity in half, meaning not too many new jobs for Americans. Plus I doubt they'll make any new contracts with UAW (well they dont deserve it anyway). Doesnt matter, there are many more looking for jobs out there. Either way there will be changes in demand, and both financial condition and the loss of GM lineup will put a negative number in the equation. As for how dramatic (or slight) the change will be is something I honestly can't predict, but I say YES there will be changes. |
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