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GM Posts $15.5 Billion Quarterly Loss.  
User currently offlineVonRichtofen From Canada, joined Nov 2000, 4627 posts, RR: 37
Posted (5 years 11 months 2 weeks 2 days 19 hours ago) and read 1360 times:

DETROIT (Reuters) - General Motors Corp reported a $15.5 billion quarterly loss on Friday as North American sales dropped by 20 percent and resale prices for SUVs coming off lease plunged.

GM shares fell as much as 11 percent in reaction to the automaker's announcement of the much bigger-than-expected quarterly loss, the third-largest in its 100-year history.





http://fresh.bnn.ca/reuters_story.as...3853_RTRIDST_0_BUSINESS-GM-COL.XML


Looks like GM is getting hit hard by the low demand for gas guzzlers. They'd better act quickly and completely change their model line soon to reflect the new reality. Meanwhile, the banner ad above this as I type is an ad for the Chevy Silverado pick-up truck  Yeah sure

I don't think GM is in danger of biting the dust, but in a few years from now if this continues? Doesn't look good for manufacturing jobs in North America.


Word
13 replies: All unread, jump to last
 
User currently offlineVonRichtofen From Canada, joined Nov 2000, 4627 posts, RR: 37
Reply 1, posted (5 years 11 months 2 weeks 2 days 2 hours ago) and read 1327 times:

Nobody gives a rats ass about GM anymore I guess... hehehe


Word
User currently offlineBaroque From Australia, joined Apr 2006, 15380 posts, RR: 59
Reply 2, posted (5 years 11 months 2 weeks 1 day 6 hours ago) and read 1288 times:



Quoting VonRichtofen (Reply 1):
Nobody gives a rats ass about GM anymore I guess... hehehe

Well you would have to begin to conclude this VR. With a quarterly loss per share nearly three times the current stock market valuation and after removal of special items, still equal to the current value, that does look like a problem.

The time when you took the big three US manufacturers output or went fishing are long gone. The UK went down this track a while ago. It will be interesting to see what the US does with its car industry.

I wonder if the Presidential candidates will solve this problem before or after they come up with a comprehensive energy plan?  duck 


User currently offlineBeaucaire From Syria, joined Sep 2003, 5252 posts, RR: 25
Reply 3, posted (5 years 11 months 2 weeks 1 day 5 hours ago) and read 1283 times:

US car manufacturers have missed the boat by years..
How come that in a country with thousands of skilled,MBA'ed managers and marketing gurus, nobody anticipated the downward spiral in large engined cars for the benefit of more fuel efficient products?
The Japanese have always lead the fuel-efficiency rankings in US car-performance together with German and Korean cars. It is simply a mystery that still two years ago production lines for SUV's have been installed,when the rise in petrol-prices was already visible.
Management in GM,Ford and Chrysler have miserably failed to adapt their companies to the changing environment.
I drive a seven year old Mercedes 220 CDI-E-Class,with 340.000 Km on the clock,and the average consumption is a mere 6.2 liters for 100 Km . ( 38 Mpg ..) - automatic with air-condition that is..
One has to wonder what development engineers at GM have been doing for thirty years ,since they seemingly have never managed to produce fuel efficient engines,and their marketing people always kept sleeping in the believe that "big is beautiful is big revenue.."
Maybe even if they had wanted to offer smaller,more efficient cars,management might have overruled their opinion and insisted on selling petrol-guzzling monsters.
I have no merci for GM -just for their workers,who have been used to produce cars nobody wants to buy any longer.
They should have watched the competition like Volkswagen,Toyota or Fiat,who are doing quite well ( specially the new ,small Fiat 500 is a killer here in France,with 45 Mpg..)
http://img387.imageshack.us/img387/8292/800pxnuova500presentazipt1.jpg



Please respect animals - don't eat them...
User currently offlineBaroque From Australia, joined Apr 2006, 15380 posts, RR: 59
Reply 4, posted (5 years 11 months 2 weeks 1 day 5 hours ago) and read 1278 times:



Quoting Beaucaire (Reply 3):
I have no merci for GM -just for their workers,who have been used to produce cars nobody wants to buy any longer.

I agree the car companies should have known what was coming, but even on a.net have you not noticed the change in the (average) tune from the US in relation to cars. I think it is nearly a year now since the last post occurred telling me how proud they were to keep me employed!! So USD100+ oil did have some positive aspects.

As to why with all those MBAs, rather is it not because of all those MBAs? The smilies have gone, but in any case there is not a special duck for flying MBAs!!!  duck   duck  Ooops, they came back again.


User currently offlineBaroque From Australia, joined Apr 2006, 15380 posts, RR: 59
Reply 5, posted (5 years 11 months 2 weeks 1 day 2 hours ago) and read 1257 times:

There is another non-issue VR. Given the way of things perhaps they are related!

Last week the National Australia Bank (NAB) wrote off just on a billion of mortgage related securities from the US down to ZERO. AFAIK, most of the US write downs have been more modest. It is possible the NAB has overcooked, but if not........

However, not a mention of this in the US again AFAIK,

It appears bad news has lost traction in the US. Hmmmm!


User currently offlineConfuscius From United States of America, joined Aug 2001, 3826 posts, RR: 1
Reply 6, posted (5 years 11 months 2 weeks 1 day 2 hours ago) and read 1256 times:

GM lost more money than what Exxon/Mobile made last quarter ?!  Wow!


Ain't I a stinker?
User currently offlineMillwallSean From Singapore, joined Apr 2008, 1234 posts, RR: 6
Reply 7, posted (5 years 11 months 2 weeks 23 hours ago) and read 1229 times:

This is not just GM this is the entire US car industry thats on the ropes. they have already sold most of its lorry and bus manufacturing so without it Detroit the American vehicle is more or less dead and dependent on a few lorrymakers with only regional presence in North America.

The US car industry really lost the plot in the 1990:ies though. They had so many managers but no one even stopped for a second and considered what rising oil prices would do to their profit.
However this is not just about rising oilprices. Look at Ford in Europe and how much marketshare they have lost. Quality is also important and Ford & GM seems to have forgotten this.

An example Volvo cars a profitable part of Volvo Ab was sold to Ford when Volvo decided to focus on its other focus areas. Ford bought it, since the purchase Volvo cars have gone from being a leading environmentalist to worst in class. Its like the entire organisation in Detroit refused to see what was happening. Volvo publicly asked for more efficient engines and less petrolconsumption for its cars but was told by Ford executives that the environment doesnt sell cars!
This was in 2006...
You really wonder under what stone these executives must have lived.
Volvo cars was known for safety, quality and environmental awareness.
Those were the first three things Ford cut down spending on. Makes you wonder what planet some people in Detroit came from. Volvo cars continued to be highly profitable until the first models done in cooperation with Ford was launched. That sort of says it all.

I am not interested in US Politics but I hope for Fords employees sake that they remember the year 2000 and the election.
They had a choice between one presidential candidate who was an environmentalist and a man who wanted to reduce debt. They had another who said environmentalists were fascists and who wanted tax cuts.
They choose the latter.
Result is a US debt that has grown from 4 trillion to 9.5 trillion. The car industry is facing death because it and the US chosed to ignore the environment.
One election was all it took for 100.000+ workers to loose their jobs...
I hope they remember how they voted because their vote did make a difference and no one can say they didnt know what was coming because both candidates were open and upfront about what they planned to do.

In the meantime across the street from Volvo Cars you find the big Volvo factory and Volvos global HQ. This company, the worlds second largest or largest manufacturer of heavy vahicles (trucks, busses and construction equipment) depending on if you count a minority owned Chinese manufacturer, produces profits year after year. Steady and without cutting down on quality environment or safety. It has gone so far that Volvo wants Ford to sell Volvo cars so that the Volvo brand isnt being dragged through the mud anymore.

Even if us in the rest of the world are laughing that their strategy of not caring about the environment or the planet came back and bit them in their tails, we are now loosing variety.

30 years ago we had different cars, huge cars in the US, wonderful small cars from France and Italy, smaller family cars from Japan and familycars from Germany and Sweden. And rubbish cars from the UK...
All with a distinct flavour to them.
Today most cars look the same and it was really only the American cars that continues their own path. To me they still looked awful and I wouldnt be seen dead in one of them, but they do provide variety.

I guess its the same with most products in the world but I miss the days when I could say what country a car came from just by looking at it.



No One Likes Us - We Dont Care.
User currently offlineStarAC17 From Canada, joined Aug 2003, 3354 posts, RR: 9
Reply 8, posted (5 years 11 months 2 weeks 16 hours ago) and read 1187 times:



Quoting Beaucaire (Reply 3):
US car manufacturers have missed the boat by years..
How come that in a country with thousands of skilled,MBA'ed managers and marketing gurus, nobody anticipated the downward spiral in large engined cars for the benefit of more fuel efficient products?

There is one word for it and it might get me flamed but I don't really care, GREED. They were blinded by the amount they were raking in from truck and SUV sales, a good portion from leasing.

Also GM was losing money long before gas prices spiked in the past year due to people perfering the Japanese and German cars. They have some great compact and midsize cars out there just not enough to compete at this moment with the tried and tested Corollas, Civics, Sentras, Accords, Camrys and Altimas. Loyalty counts and GM has to get some when is comes to the compact and midsize cars. They make a great truck and I like how the company Sierra's that I have to drive handle especially for heavy loads but most people don't need that.



Engineers Rule The World!!!!!
User currently offlineStasisLAX From United States of America, joined Jul 2007, 3280 posts, RR: 6
Reply 9, posted (5 years 11 months 1 week 6 days 8 hours ago) and read 1133 times:

There alot of talk about GM shutting down brands or some type of miracle product-based resurgence or even relocating GM's headquarters to somewhere hip and new (meaning not in Michigan) are utterly stupid at this point in time. It's way too late in the football game - GM's behind by a couple of touchdowns and only has one time out left - and it's the two minute warning in the fourth quarter. GM is looking for a couple of hail-mary touchdowns and that very unlikely to happen given its competition.

GM does not appear to have a comprehensive and realistic plan for successfully completing a Chapter 11 bankruptcy filing, a plan that would allow GM management to perform a radical reorganization and downsizing. At this late stage of the game, GM doesn’t have needed capital to kill off under-perforning brands like Hummer, Buick, and Pontiac - unless they file for bankruptcy - management cannot afford to terminate franchise agreements with these brand's dealerships and also reduce their union contracts as part of a massive Chapter 11 reorganization plan.

GM will also have tremendous issues in attracting new talent and keeping whatever decent talent that they currently have left, at a time when they really require the best and the brightest employees. Without a viable turnaround plan, and having enough money to actually implement it, high-caliber candidates will avoid GM like the plague and current employees will quickly jump ship for another employer in search of some level of job security.

The U.S. media often speak about a GM bankruptcy as if it is incurable brain cancer, but there are some industry experts that believe that the "nuclear" option is the best option for GM because its current business model is very badly broken. Chapter 11 provides GM with an alternative to the complete failure of their firm and provides NEW management with the best opportunity for a fresh start as a smaller, innovative, and more nimble organization.

GM management cannot allow the company to get the point that GM does not have enough money to complete a drastic downsizing and full reorganization. They have to have enough cash on hand so that their creditors will approve the reorg plan. Current GM executives like CEO Rick Wagoner, Fritz Henderson, and Bob Lutz seem to have their damn heads buried in the sand - they need to be forced out along with any remaining executives that are in full denial of GM's dire financial situation. Many GM employees seem to feel entitled to their company's right to survive, but nobody can or should claim that entitlement when their company loses as much money and market share as GM has lost.   

[Edited 2008-08-05 02:58:00]


"Those who would give up essential liberty to purchase temporary safety deserve neither liberty nor safety!" B.Franklin
User currently offlineStasisLAX From United States of America, joined Jul 2007, 3280 posts, RR: 6
Reply 10, posted (5 years 11 months 1 week 5 days 17 hours ago) and read 1079 times:



Quoting MillwallSean (Reply 7):
I guess its the same with most products in the world but I miss the days when I could say what country a car came from just by looking at it.

Buick, a stodgy old brand here in the U.S. is the hippest of the hip in China. Maybe GM just needs to concentrate its efforts in China and put the U.S. market on the backburner for awhile.

http://www.msnbc.msn.com/id/25950947/



"Those who would give up essential liberty to purchase temporary safety deserve neither liberty nor safety!" B.Franklin
User currently offlineLnglive1011yyz From Canada, joined Oct 2003, 1608 posts, RR: 15
Reply 11, posted (5 years 11 months 1 week 5 days 16 hours ago) and read 1072 times:

And, so what are they pushing now?

The big-engined Camaro.

GREAT business decision.

Oh well. They'll never learn.

1011yyz



Pack your bags, we're going on a sympathy trip!
User currently offlineRevelation From United States of America, joined Feb 2005, 12287 posts, RR: 25
Reply 12, posted (5 years 11 months 1 week 5 days 15 hours ago) and read 1066 times:



Quoting Beaucaire (Reply 3):
US car manufacturers have missed the boat by years..
How come that in a country with thousands of skilled,MBA'ed managers and marketing gurus, nobody anticipated the downward spiral in large engined cars for the benefit of more fuel efficient products?

The downward spiral would not be happening if gasoline was selling for $1.29/gal instead of $3.99/gal. That move happened in a small number of years, faster than any US auto maker is set up to react to.

Not that I'm defending them. The US auto makers have had 40 years to deal with Japanese imports, and have not been able to. They've been keeping salaried and hourly workers pay and benefits high, and have produced cars just barely good enough for a subset of Americans to buy them, more out of misguided loyalty than anything else.



Inspiration, move me brightly!
User currently offlineBaroque From Australia, joined Apr 2006, 15380 posts, RR: 59
Reply 13, posted (5 years 11 months 1 week 5 days 11 hours ago) and read 1052 times:



Quoting Revelation (Reply 12):
more out of misguided loyalty than anything else.

From this distance it also appears that the NIH factor is pretty important too - not invented here.

The other problem is that even at the recent high prices, gasoline (petrol to me) is still a small proportion of total running costs.

Ironically, the high prices have been more important in reducing oil consumption than in raising the real costs of whatever it was you were using oil for.

Back in the 60s with the 850 cc Mini trying to compete with the 2700 cc Holden, you were going to have to drive a long, long way to make a significant saving on the Mini other than the prime cost.

But great news if the US (and Aus) has been frightened out of buying large cars - not before time. I do remember Holden (GM in Aus) moving to smaller cars about 1980 but during the 80s when oil prices went down, the large cars got larger again. I wonder how many in GM now remember that and assume that this particular bit of history will repeat - not too many I hope.

How much have the GM problems been caused by the interest rates following the sub-prime crisis and how much by high gas prices? I remember a comment some time ago that both GM and Ford were more finance companies than manufacturing companies.

The restructuring of GE to split off the financial arm a bit from the hardware part is odds on to be related to problems in the lending business.


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