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8237 messages, Last post on Nov 22, 2009 at 8:40 AM
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Replying to: 62vetteefp (Jan 08, 2009 4:42 am) **** That's just not true, though. Urban myth level of wrong, actually. Sure, some money flows up to corporate, wherever that is, but that money usually doesn't contribute much to the economy. In fact, in the case of GM, since there are technically no profits, they pay no taxes on that money. And it doesn't cost 1 billion to physically design a new car at corporate. Not the way GM is doing it. The typical full sized auto plant in the U.S. contributes upwards of a billion dollars a year in primary and secondary costs that do go directly into the local economy. They design the cars in the U.S., but if they build them in a foreign country for a decade, that's 5-10 billion in lost money per plant. If GM and Ford have ten such plants between them, let's say, well, that's essentially a bailout every couple of years in lost jobs and money. The NUMMI plant in Freemont, CA alone does cost 1 billion in total upkeep and money flowing through it per year. http://en.wikipedia.org/wiki/NUMMI Size of 88 football fields. These things are huge and when they're moved out of the U.S., it really does hurt a lot. And I'm not even talking about the snowball effect of thousands of people's jobs. Unemployed people are a huge drain on our economy, so it's almost like taking two hits. Where it is made is the vast majority of the money that actually gets into the economy from making a vehicle.(parts suppliers as well, of course, and not counting oddball practices like the Job Bank) Toyota makes a few thousand profit on each Camry made in the U.S.. 2/3 of that might go back to Japan, and maybe another couple of thousand for the engine and transmission. But last I checked, the things costs a lot more than 5K or so that's going back to Japan. The difference is all going somewhere - metal, parts, power to run the plant, gas to transport the vehicles, money to dealers... The list is literally nearly endless. Now, true, a D3 vehicle made in the U.S. is the best option, as more of the money is staying here, but I can guarantee that a truck made in Mexico is adding a lot less to our U.S. economy than a Honda made here. Surely someone has a list of D3 vehicles that are made in the U.S.?
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Replying to: bpizzuti (Jan 08, 2009 7:11 am)  True, but I'd bet I'd loose more customer's by letting the weeds grow through the cracks in the parking lot and letting the facilities fall into disrepair. Customers want a good value and service for their dollar. If reducing employment leads to poor customer service or quality, then customers will eventually go elsewhere. My point is a person doesn't start their own business with the single goal to employ somebody.
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Replying to: dieselone (Jan 08, 2009 8:33 am) You're right, they supposedly go into business to make money. Now someone needs to tell Waggoner and Nardelli that, since it seems to be beyond their understanding that if they can't make money then they should go out of business.
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Replying to: 62vetteefp (Jan 07, 2009 12:25 pm) I wonder if this is really true or if it is a PR ploy to raise the confidence of buyers so that it *becomes* true? It doesn't seem like enough has changed in the economy to create this improvement unless GM was painting a poorer picture than reality during the Congressional hearings. Has GM completed some major new cost-control activity since the bailout hearings, or has the economy improved? What has changed from their previous dire forecast?
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Replying to: 62vetteefp (Jan 07, 2009 5:44 pm) And that even means they can afford to fund their VEBA commitments? Pardon me if that seems a bit optimistic, let's see how the year actually plays out. |
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Replying to: bpizzuti (Jan 08, 2009 8:43 am) Yes. First, GM and Ford are public companies, not owned by the execs; they are owned by the millions of shareholders. Probably you and I are owners thru our mutual funds. I invest in companies to make money; I really want GM (and every other corporation I have stock in) to spend the least amount possible on landscaping, office furniture, and the arts (examples) as possible. Too many corporations waste money, and then when times turn tough they don't have any savings. If GM can get by now without corporate jets, then they could have done so for years, and the $ spent over the years could have been saved. The things GM is now considering to stay viable, should have been implemented years before this downturn.
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Replying to: 62vetteefp (Jan 08, 2009 4:05 am) Regards, OW |
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Replying to: plekto (Jan 08, 2009 8:16 am) Sure, some money flows up to corporate, wherever that is, but that money usually doesn't contribute much to the economy. In fact, in the case of GM, since there are technically no profits, they pay no taxes on that money. Do not tell that to all the employees at the tech center, proving grounds, ren cen and elsewhere that they are not paying taxes. Seems like a lot of income and SS tax being paid. And if they were making money they would be paying taxes. They design the cars in the U.S., but if they build them in a foreign country for a decade, that's 5-10 billion in lost money per plant. If GM and Ford have ten such plants between them, let's say, well, that's essentially a bailout every couple of years in lost jobs and money. GM has ~20 plants in NA and 4 of them are in Mexico and Canada. And they do sell vehicles in both those countries so it is perhaps 1 plant of production from Mexico and Canada that actually make it here to the US (assuming cars from the US are also going to Canada and Mexico). There is also a plant shipping Aveos from overseas and the Astra and a few G8's made in Austrailia. So most all the money does stay here in the US. Lets talk 2010. The vehicles made in Canada are the Impala, Camaro, Equinox, SRX (LaCrosse moving here, Canada truck plant closing down). In Mexico the full size SUV's (1 plant in Mexico, 2 in the US), HHR, Vue. |
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Replying to: kernick (Jan 08, 2009 9:33 am) Forget probably. I own 250 shares of Ford directly, and would love to see them start paying dividends. |
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Replying to: tlong (Jan 08, 2009 9:25 am) In December, GM requested $18 billion in federal loans, saying that was what it needed to make it to 2010. That number factored in GM's 49 percent stake in its struggling financial unit, GMAC Financial. Bottom line is they got all the money they asked for, for the year approved and is now being paid out. GMAC was part of that $18 billion.
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