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What bankruptcy would mean to GM

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Plunging market share, huge layoffs and a copycat filing by Ford. Those are just a few of the likely outcomes if GM can't avoid bankruptcy court.

By Robert Walberg

Rick Wagoner, chief executive of General Motors, has tried to comfort investors by saying GM has no plans to file for bankruptcy protection.

Cold comfort, I'd say. The company's deeds, if not the CEO's words, point to an acute need for some sort of bankruptcy plan, even if just as a contingency. Consider: GM (GM, news, msgs) lost nearly $4 billion over the last year; its credit rating dropped to junk status; car sales plunged as GM built bigger cars and trucks just as gas prices skyrocketed; its cash horde has been cut nearly in half; and its leading parts supplier, already in bankruptcy, faces a possible strike that could shutter GM plants for weeks if not months.

It would be irresponsible of management not to at least have some bankruptcy plan in the works, so that if the worst-case scenario did play out, they would be ready with a recovery plan. Below, I'll outline what a GM bankruptcy might look like, and how it would impact workers and competitors.

No leadership, no vision
First, a quick look at what management is doing now. GM's main push in coping with its current troubles is to cut back production deeply enough to create a balance between supply and demand. To achieve this objective, management announced that it will be closing a total of 12 plants and support facilities and slashing 30,000 employees by the end of 2008.

Basically, this course is a tacit admission by management that it has no interest in developing a plan to increase customer demand for its cars. That would require real vision, real leadership and real innovation. These are not traits Wagoner has displayed to date.

Full Story: http://moneycentral.msn.com/content/P136968.asp
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I swear many may not agree with me....but when does Jim Dollingers AKA Buickmans words start to hold water? I mean, seriously?
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But then the more I read the piece, the more I think this dude is an ass clown and is only writing this to cement the ToyoHondaSan sentiment amongst Americans. Such pieces of dog trash. I can't wait until NAIAS '06. It's going to be fun.
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Ok one more thing that strokes me but not in a good way:

If GM ever wants to be a major player again, though, the Board of Directors needs to admit that the current management team lacks the imagination, innovation and resolve necessary to accomplish that goal.


Is this guy kidding me? He's going to question the new management team? Bob Lutz is the BEST thing to happen to General Motors. The Pre-Lutz vs Post-Lutz designs are keeping the company further from bankruptcy than we are seeing now!
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Why is everybody assuming that Ford would follow GM into bankruptcy. Financially they are in better position, they have no brands to get rid off, most of the UAW concessions GM would get if it went into bankruptcy Ford would probably get too. And, what's in it for Ford family since they are large shareholders also?
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This has been said before, but why isn't the press all over the fact that Toyota and Honda missed the last 10 years of trucks sales? The press pisses all over GM for "missing" the hybrid/gas mileage thing, yet what did they do by buying Daewoo? The Aveo may not be as great on gas as a Civic, but it is a start. I admit this Delphi thing has me concerned, but one would have to give the Board some credit for seeing this thing coming. I believe this is all playing out for the upcoming 2007 UAW talks. The Board can't reveal their bankruptcy plans, quite obviously, because then the media would trumpet that the Board thinks GM is going to go bankrupt. DAMNED IF YOU DO, DAMNED IF YOU DON'T.
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they have no brands to get rid off

[post="47877"]<{POST_SNAPBACK}>[/post]

Many consider Lincoln and Mercury just as weak as Pontiac and Buick, if not weaker.
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Many consider Lincoln and Mercury just as weak as Pontiac and Buick, if not weaker.

[post="47887"]<{POST_SNAPBACK}>[/post]


I sure do.
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My Buddy Ross predicts taht Buick will bite the dust and GM will get bought out by Toyota. When he suggested that and I realized it's not completely unrealistic I felt sick to my stomach.
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Why would Toyota want GM? Why would Toyota want to deal with the UAW? If GM ever liquidates, I could see Toyota getting a factory or two, as long as the UAW wasn't part of the deal.
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Sixty8panther: Tell your buddy Ross that if something major happens, Buick wouldn't be the only one to "bite the dust." GM itself will be through.
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Rick Wagoner is a wonderful family man, an involved father, and I believe he truly cares about GM. That aside, his record as head of GM is disastrous, therefore he must go. He has allowed Lovejoy, Smith, and LaNeve to virtually destroy GM with ineffective marketing, this in spite of truly competitive products. Let's not forget these are the vehicles promised to us in years past. The engineers, stylists and production people have all fulfilled their responsibilities. Marketing is THE PROBLEM! Return to Greatness solves that problem, if only they would listen and give their top salesman a chance to prove himself. These are NOT only my ideas. I have spent decades listening and developing what WILL WORK. Forget the money, give it a try. What does GM have to lose? Bean counters don't understand customer psychology, I do. Choose... BK or BM.
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[quote name='ehaase' date='Nov 24 2005, 09:58 AM']
Many consider Lincoln and Mercury just as weak as Pontiac and Buick, if not weaker.

[post="47887"]<{POST_SNAPBACK}>[/post]


I was at a mercury dealer recently pretty weak!
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Many consider Lincoln and Mercury just as weak as Pontiac and Buick, if not weaker.

[post="47887"]<{POST_SNAPBACK}>[/post]


Agreed very much, though not necessarily on the Mercury end. I can Mercury attaining stability and brand-growth very soon, but at the heavy expense of Lincoln. I'll be so audacious to say that one day Lincoln may exist within Mercury offering one or two models like the Navigator and Town Car successor, much like the Geo/Chevrolet relationship though on the other end of the spectrum.

I really don't see much financial or marketing sense in pouring money into the sieve that is Lincoln. Its a brand with little cache, little cash, no identity, and vehicles that are either completely unappealing or decent if you ignore the cheaper Mercury variant (Zephyr vs. Milan, Mountaineer vs. Aviator).

How many new Lincolns have you seen on the roads? How many Zephyrs? Mark LTs?
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I gotta agree, the marketing at GM is atrocious! It's been like that for ages too. I think Wagoner should go too. He's a not a car guy, and it shows. Bringing Lutz was a great move, but Lutz is not the CEO. At the end of the day, Wagoner makes the decisions. I don't know who they could bring in, but GM does need a new leader, IMHO.
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Rick Wagoner is a wonderful family man, an involved father, and I believe he truly cares about GM. That aside, his record as head of GM is disastrous, therefore he must go. He has allowed Lovejoy, Smith, and LaNeve to virtually destroy GM with ineffective marketing, this in spite of truly competitive products. Let's not forget these are the vehicles promised to us in years past. The engineers, stylists and production people have all fulfilled their responsibilities. Marketing is THE PROBLEM! Return to Greatness solves that problem, if only they would listen and give their top salesman a chance to prove himself. These are NOT only my ideas. I have spent decades listening and developing what WILL WORK. Forget the money, give it a try. What does GM have to lose? Bean counters don't understand customer psychology, I do.

Choose... BK or BM.

[post="47962"]<{POST_SNAPBACK}>[/post]


I have an unrelated question. Is you moniker self-assigned? I just ask because I saw this very thing backfire when I was car shopping back in March. I was at a Honda dealer in the area...I wont say where, but let's just say it rhymes with Bay City. :rolleyes:

Within 15 mins I could tell I wasn't going to be too interested in anything they had to offer me. Past that the salesman I got was a 100% complete asshole. Within 10 mins he was asking me questions like "whats stopping you from buying this car right now?!?" And with an almost angry tone. Anyhow, the amount of bullsh!t coming out of this guys mouth was hilarious. I didn't even call him on any of it just so I could see how far he'd go.

So im leaving and I notice his business card says Earl "The Pearl" xxxxxxxxx. Apparently everyone at the dealer has a little thing with nicknames on their business card. Anyhow, any thought of this guy being a pearl is downright asinine. I sent it back to his sales manager telling him what happened and changed it to Earl "The Asshole" xxxxxxxxx.

By the way...referring to yourself as "BM".....yea. Not good either.
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I'll be so audacious to say that one day Lincoln may exist within Mercury offering one or two models like the Navigator and Town Car successor, much like the Geo/Chevrolet relationship though on the other end of the spectrum.


That's a good idea. For most of the 1960's, all Lincoln had was the Continental sedan and convertible. The Town Car is what Lincoln is all about. There will always be 50,000 to 100,000 people who just want a big, luxurious comfortable sedan.

Back to GM's bankruptcy. I don't think that Wagoner has it in him just to give up and do what Wall Street wants - which is go through Chapter 11, eliminate the pension plan, slash even more workers, plants, and the health care plan and cut everything except Chevrolet and Cadillac. An honorable man like him wants to keep pushing and fighting until there is no other option.
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For decades people in Flint proclaimed they worked at "The Buick". Also it has been fairly common for many here to refer to themselves as a "Buickman". Now I do not have any such reference on my business cards, nor do I refer to myself as such in person. However, many people have a nickname on the net, therefore I proudly use "Buickman". Having led the United States 6 times in retail Buick deliveries, I suppose it's appropriate.
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Agreed very much, though not necessarily on the Mercury end. I can Mercury attaining stability and brand-growth very soon, but at the heavy expense of Lincoln. I'll be so audacious to say that one day Lincoln may exist within Mercury offering one or two models like the Navigator and Town Car successor, much like the Geo/Chevrolet relationship though on the other end of the spectrum.

I really don't see much financial or marketing sense in pouring money into the sieve that is Lincoln. Its a brand with little cache, little cash, no identity, and vehicles that are either completely unappealing or decent if you ignore the cheaper Mercury variant (Zephyr vs. Milan, Mountaineer vs. Aviator).

How many new Lincolns have you seen on the roads? How many Zephyrs? Mark LTs?

[post="47992"]<{POST_SNAPBACK}>[/post]


Really interesting thoughts on FMC, Flybrian. Come to think of it, most, if not all Lincoln dealers are Mercury dealers anyway...How hard is it to sell the same vehicle with a different face/interior on the same lot? Just by the dealer network alone, it seems as if L/M should be complimentary, if anything. (Similar to the GMC/Cadillac/Buick dealership.) And give 'em some autonomy from the Ford brand!

About the article:


...As others have said, Lutz, in particular, has lead a striking improvement in product. They're willing to try novel things (Solstice, in particular), and shoring up the areas where other products have had deficiencies. GM may need to dump Wagoneer, but to say that GM's (new) products (business management, is a different matter) reflect this 'lack of vision' shows lack of literal vision on the writer's part. He's damning them for all the wrong reasons!

GM's not going to solve all its problems in one fell swoop, so to say that they need to dump everyone at the top, especially in light of vehicles like the refreshed Impala and retooling of Saturn, seems knee-jerk and suspect. Bring in better 'talent' and 'vision' to suppliment product gurus, such as Lutz...and, yes, better marketers, as well.

...And then there's the healthcare issue...[massages temples]...IMHO, that's where this vaulted 'vision' is really needed... Edited by OptimusK
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Rick Wagoner is a wonderful family man, an involved father, and I believe he truly cares about GM. That aside, his record as head of GM is disastrous, therefore he must go. He has allowed Lovejoy, Smith, and LaNeve to virtually destroy GM with ineffective marketing, this in spite of truly competitive products. Let's not forget these are the vehicles promised to us in years past. The engineers, stylists and production people have all fulfilled their responsibilities. Marketing is THE PROBLEM! Return to Greatness solves that problem, if only they would listen and give their top salesman a chance to prove himself. These are NOT only my ideas. I have spent decades listening and developing what WILL WORK. Forget the money, give it a try. What does GM have to lose? Bean counters don't understand customer psychology, I do.

Choose... BK or BM.

[post="47962"]<{POST_SNAPBACK}>[/post]

Your joking right?
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No joke, he's a family man. :) I don't know that working in the north end of Flint was such an advantage. You saw the area in Roger and Me. High crime, boarded up buildings, weeded lots. Success was more due to word of mouth, customers throughout Midwest, specialized in home deliveries, other aspects included in The Plan. If you know Flint and Saginaw, you may be familiar with Birch Run. Raised sales there 52% last year as General Manager. Traditionally the store was around #40 out of top 50 in market. Last month finished #7, climbing. Who is John Galt? Edited by buickman
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Why would Toyota want GM?  Why would Toyota want to deal with the UAW?

[post="47927"]<{POST_SNAPBACK}>[/post]



That's easy: the full size truck lineup, especially the HD's. Everything else would get pitched out the window, except maybe the Vette.
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Rick Wagoner is a wonderful family man, an involved father, and I believe he truly cares about GM. That aside, his record as head of GM is disastrous, therefore he must go. He has allowed Lovejoy, Smith, and LaNeve to virtually destroy GM with ineffective marketing, this in spite of truly competitive products. Let's not forget these are the vehicles promised to us in years past. The engineers, stylists and production people have all fulfilled their responsibilities. Marketing is THE PROBLEM! Return to Greatness solves that problem, if only they would listen and give their top salesman a chance to prove himself. These are NOT only my ideas. I have spent decades listening and developing what WILL WORK. Forget the money, give it a try. What does GM have to lose? Bean counters don't understand customer psychology, I do.

Choose... BK or BM.

[post="47962"]<{POST_SNAPBACK}>[/post]

you've posted the same thing at CZ28. I posted something in response and you never bothered to say anything about it. You are severely mistaken, Buickman. Where are the products we were promised? Where are the gotta haves? Where are the fullfilled responsibilities you speak of?

When was the last time you saw a Buick place higher than 3rd or 4th place in a compairson in the major magazines? You'll have to think a long time back. Even with thousands and thousand of dollars off the metal, Buick's market share is still decreasing.

What is the problem? Desirable product. It goes no further than this.

I am tired of you ignoring sensible posts, we should just ignore you, because you are not sensible.

BUICKMAN has called for the UAW to STRIKE over at CZ28!! How in the world could that help profits, sales, GM's health? I'll answer that one. In no way would a strike be beneficial to GM's fortunes right now. Your plan won't be implemented, give up!! Clearly, if you were shot down once, you would have tried to see what the fatal flaw was there, and you would have fixed it.

With your limited perspective in Michigan where all things GM matter, you have no view of the most important markets where GM has lost all of its business. In order to get back to a healthy state, GM will have to stop thinking with the Detroit mindset, where everything domestic sells, and start thinking with the world mindset, where quality and design rank above all else in consumer products. Ultimately the product is about the consumer. GM lost touch with the consumer and is now paying for it. They didn't serve the customer, idiots!!!!!! They should have listened long ago.

Thank God, there is a glimmer of hope coming in the form of Lutz cars, the holy grail of Wagoner's tenure with GM.
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