Lutz Says GM Is Over the Worst

[wildcat]

An April 13, 2006 article from Business Week gives Bob Lutz the chance to speak on GM's behalf. To view the piece, click here.

[BigPontiac]

"Rick Wagoner is without question the right man to lead GM and continue the turnaround," Lutz said. "Read my lips. Rick Wagoner will preside over a turnaround at General Motors."

[4gm]

Lutz also insisted that the HHR would be a huge hit before it went on sale.

I predict GM roughly breaks even by the 3rd quarter of this year.

Edited April 13, 2006 by 4gm

[capriceman]

Funny thing is that at the last minute they where going to pull the HHR and take there losses there. But Wagoner and lutz said they would limit first production month to minimum but when the demand increased as people liked the production went to full steam. I hope things will never be this bad again.

[regfootball]

no, they will 'show losses' until they break the next union contracts.....

they need the losses as leverage against the union.

[regfootball]

Rick Wagoner is without question the right man to lead GM and continue the turnaround," Lutz said. "Read my lips. Rick Wagoner will preside over a turnaround at General Motors

more buickman bait, right from Bob Lutz' mouth, nonetheless.

Edited April 13, 2006 by regfootball

[jbartley]

well said mr lutz!

[CaddyXLR-V]

no, they will 'show losses' until they break the next union contracts.....

they need the losses as leverage against the union.

Thats what I'm thinking. I dont think we will start to see profits until 07.

There will probably be more restructuring charges, employee buyouts, and the delphi deal that will keep GM from making money in 06.

[Newbiewar]

Thats what I'm thinking. I dont think we will start to see profits until 07.

There will probably be more restructuring charges, employee buyouts, and the delphi deal that will keep GM from making money in 06.

dont forget the incentives drop in the recent months..

with incentives being roughtly half of what they were 1 year ago, that saves GM half a billion dollars per month... that alone might be enough to leverage losses

[Newbiewar]

good read... but most of which was from the journalists perception...

[76ChevyTrucker]

It was a good read and I'm glad to see something positive come out like that. Then again, I pretty well have always seen Mr. Lutz saying nothing but positive things about the company. Just like everyone else says, I don't expect to see things go back into the black with GM till roughly mid-07, but at least its something to look for.

[evok]

http://detnews.com/apps/pbcs.dll/article?A.../604130376/1148

http://www.nytimes.com/2006/04/13/automobi...r=1&oref=slogin

"But analysts say they have played a valuable role that executives may not acknowledge.

"Without pressure from Wall Street, they would never have got things moving," said Brad Rubin, an industry analyst with BNP Paribas in New York. "It took Wall Street to wake them up.""

Mr. Rubin is talking out of his ass. GM only announced the restructuring after 2 bad quarters. 4th - 04 and 1st 05. The contingency for the restructuring began prior to Jan 05.

""People who think it doesn't matter who owns our automobile industry are flat wrong," he said, adding that it was "fiction" that foreign automakers were becoming more American as they build plants here. "They are not producing. For the most part, they are assembling. The parts mostly come from overseas. The profits are partially invested in the United States but not necessarily.""

And here Uncle Bob is doing the same. How much has GM invested in China and other parts of SE Asia compared to say the US in recent years?

Edited April 13, 2006 by evok

[Mr.Krinkle]

the market in asia cant be ignored. it shouldnt have come at the expense of our own economy but nevertheless, what could happen in th "japan inc." got its foot in the door first over there. its widely recognized as the "place to be".

i was thinking that too as i was reading that. but so it goes.

lutz is a tough 'sum bitch. the trade agreements here dont necessarily favor our side. sure, the end result is a more affordable product for consumers but thats about it. even the labor they do use here is still pretty cut rate. i dont know this for a fact but theres probably a bunch of loopholes too.

did you know english is primarily used for contract purposes. theres something about this language that simplifies the way to lie. thats a fact jack.

the globalization doesnt change the fact where the headquarters of a company is and where the majority of the profits and benefits will wind up.

[FUTURE_OF_GM]

""People who think it doesn't matter who owns our automobile industry are flat wrong," he said, adding that it was "fiction" that foreign automakers were becoming more American as they build plants here. "They are not producing. For the most part, they are assembling. The parts mostly come from overseas. The profits are partially invested in the United States but not necessarily.""

And here Uncle Bob is doing the same.  How much has GM invested in China and other parts of SE Asia compared to say the US in recent years?

And WHY have they done that?!?!?!?

Because without success in Asia-Pacific, GM would never be able to fund it's fat ass (buy japanese) american healthcare subscribers and OVER PAID union.

End of story.

The "universal" insider line is always about INVESTMENT.... How much has Detroit INVESTED?!?!? Well I'll spin that a few more ways 1) How much (After tax breaks and lost jobs/revenue from Detroit) have the import companies invested??? 2) Why is it all of the sudden about investment??? Why hasn't Toyota and Co. been investing in our economy for the past 100 years like Ford and GM have??!?! 3) What about the profit? You know, the BILLIONS that american minions building and buying Toyotas sends to Japan?

America sold GM out before GM sold america out... Until the government makes it advantageous to DO BUSINESS in america WHILE being an american company instead of a "transplant" or "new domestic" then I say we outsource the whole DAMN COMPANY!

Maybe THEN americans might give GM a little credit for it's GOOD products, becuase THEN it will be an awe inspiring import, just like Toyondassanyundkia.

***As for the article and it's "comments".... As usual, they're pretty off base and steeped in fantasy. It's as if these people assume that labor, healthcare and trade practices are all universal throughout the world. There is not feasible way for GM to OUT Kia, Kia with an american built vehicle and still shut Wall Street up (a.k.a. make a profit)

P.S. Speaking of investment (On a PURELY UNRELATED NOTE) it gets a liitle tiring to hear; GM is obligated to employ americans and GM better make a profit in the same breath. You can't HAVE your cake and EAT it too. Pick one or the other and stop chastising GM just to see them get screwed over.

[sciguy_0504]

GM better use all its might against the oil companies or else a turn around consisting of large SUVs, trucks and crossovers will not only turn the company into a laughing stock, it may also be the final straw.

[turbo200]

though he often puts his foot in his mouth, i am glad GM has a man like Lutz. and I am proud of him for going out there and speaking his mind undeterred of what people have to say. it's good to hear him say wagoner will preside over turnaround. lutz gets a lot of the credit though---design matters now because of him.

[Brandon Lutz]

though he often puts his foot in his mouth, i am glad GM has a man like Lutz. and I am proud of him for going out there and speaking his mind undeterred of what people have to say. it's good to hear him say wagoner will preside over turnaround. lutz gets a lot of the credit though---design matters now because of him.

I agree. It refreshing to hear someone tell it like it is and not hold back. He is the type of guy who instills confidence in the company.

[Charger4U]

thats good news

[Ghost Dog]

Its far from over yet. Delphi is unresolved. Strike is still possible. What I heard up here is they are'nt afraid to bring GM down. They're going to do what they have to.

[CaddyXLR-V]

Its far from over yet. Delphi is unresolved. Strike is still possible. What I heard up here is they are'nt afraid to bring GM down. They're going to do what they have to.

They need to be careful what they wish for. Their actions cant be undone, and if their lives suddenly get 10 times worse because of their own actions, the rest of the country wont want to support it. Their all or nothing mentality will leave them with nothing in the end. You strike, you lose. Simple as that.

[Northstar]

Its far from over yet. Delphi is unresolved. Strike is still possible. What I heard up here is they are'nt afraid to bring GM down. They're going to do what they have to.

I guess if they aren't afraid of losing their jobs then they aren't scared of bringing GM down, but I think that's more talk than anything.

GM will show it's in charge in the Sept. 07 talks. The Union is going to have to make concessions, because if they don't think GM can just hire people off the streets. Sure, it would be costly to do, and would take a while to train them, but it could be done and would make up the money GM lost from not producing anything for a while very quickly.

The fact is that the Union workers are paid way more than workers at Honda, Toyota, or Nissan, and they're either going to have to make concessions so that their wages and benefits are more similar to the workers at Honda, Nissan, and Toyota plants, or they'll be without a job. It's as simple as that, IMO.

[4gm]

If Delphi workers strike, GM will pay for replacement workers. And they won't wait very long to do it either. I'd give them 3 full weeks at the very most. I'll bet one of the reason why GM has been selling off assets as of late was to bring their cash reserves up to pay for temporary factory workers both at Delphi and its own plants in case of a strike. They know they can't weather a long term strike. A long term strike would force them into bankruptcy which management absolutely will not let happen. With its cash reserves GM could weather a short term strike and lost productivity while it trains new workers to get them up to speed. The UAW has another thing coming if they think they'll bring down GM. There will be lines around the block to fill their positions while they picket. And after a few months, GM's factories will be churning out the cars like nothing even happened.

[Ghost Dog]

If Delphi workers strike, GM will pay for replacement workers.  And they won't wait very long to do it either.  I'd give them 3 full weeks at the very most.  I'll bet one of the reason why GM has been selling off assets as of late was to bring their cash reserves up to pay for temporary factory workers both at Delphi and its own plants in case of a strike.  They know they can't weather a long term strike.  A long term strike would force them into bankruptcy which  management absolutely will not let happen.  With its cash reserves GM could weather a short term strike and lost productivity while it trains new workers to get them up to speed.  The UAW has another thing coming if they think they'll bring down GM.  There will be lines around the block to fill their positions while they picket.  And after a few months, GM's factories will be churning out the cars like nothing even happened.

Struck Goods Clause. If Delphi Strikes and The GM U.A.W contract has a struck goods clause. GM U.A.W workers don't have to touch those parts.

[4gm]

Struck Goods Clause. If Delphi Strikes and The  GM U.A.W contract has a struck goods clause. GM U.A.W workers don't have to touch those  parts.

I'm sure a lot of currently unemployed citizens wouldn't have a problem with it.

[Ghost Dog]

I'm sure a lot of currently unemployed citizens wouldn't have a problem with it.

Well the Delphi strike could go on till sept. 07 The Gm workers could'nt be replaced they would be entirely within thier contractual rights to refuse to handle struck goods.

[ellives]

Bring it Delphi! Bring it! Wait! Nevermind. Josh will blame THAT on management too.

Its far from over yet. Delphi is unresolved. Strike is still possible. What I heard up here is they are'nt afraid to bring GM down. They're going to do what they have to.