evok

I am familar and understand the positive accomplishments. The transformation is nothing short of incredible. A legacy from the pre-Lutz days. All but the Lucerne were in development prior to Lutz's arrival and too late to axe. As for the Lucerne the numbers were relative good until recently. Every OEM has $h!ty marketing. That deal was BS and I outlined here in depth (summer 06) why it was dumb. It was one sided in R_N's favor and GM got nothing out it. The deal was orchastrasted so R_N could buy Kerkorian out. If the deal would have happened GM would be in the same boat today. R_N would not have coughed up the cash they need and R_N right now have their own problems. GM's debt went to pay for their unfunded pension. All the assets GM sold off went to pay off the union and buyouts and the new product that is delayed right now that was to turn the company around if not for the Financial collapse. In case you missed it, we are in the worst auto recession since the great depression. Last I checked the only product in the works right now in NA is the Volt. Hummer has little value much like SAAB because of its integration into GM. There is nothing to sell besides a name and would not and will not command premium cash. Shareholder action - The company is worthless. In anycase the company would be obligated to file Chapter 11 if they had to baring no bailout. Than the company gets liquidated when there is no DIP financing and sales drop like a rock. If the company went BK even under Chapter 11, shareholders would get squat. When the government steps in the shares will get diluted as the UAW VEBA and unsecured debt gets rolled into the equity. The US auto market went from 16 million, to 15 and now to 10 million unit per year in less than 1-year. There is probably not one auto company doing business in the US making money right now. The cost structure in this business is not that flexible. That is freaking 10 million sales a year. I blame RW for not have more cash on hand but at current rates, a few more billion would do nothing for them. For the most part the current track record has be good given the task they had to do. This company was a train wreck when he took over and still paying for the Roger Smith era.

Sorry - But you just do not understand the gravity of the structural changes the company has made since 2001. Change Agent - sounds like MBA text book buzzwords mubo jumbo than a real solution. Even with a "Change Agent" the situation today would likely be no different. No "Change Agent" could delete a large portion of GM's bloated, inefficient dealer body or make the UAW and their legacy costs go away or give them more cash to fix their damage brands. However if their is proper authroity given to the Federal Overight Board, that will finally happen and debt, UAW obligations could be restructured, brands could be rethought. Most of GM's long term debt was used to fund its unfunded pension IIRC circa 2003. Something GM was obligated to do. I advocate that sort of "Change Agent". As I said before, if Mullaly is your idea of a "Change Agent" you are fooling yourself. He is executing a prior plan that saves product development cost because the products will be global. Ford does not have the money to do anything else. If not for the $30 billion home equity loan in September 2006, Ford would have had their hands out in December 2006. Other than that Ford followed GM's lead on all other moves. To make the situation easier, Ford only has 1 main brand. In today's environment, by the time the "Change Agent" figured out GM's sprawling operations and understood the problems, the liquidation sale would have been over. Strike II - I happen to be a fan of the sport.

fyi - baseball is a game! For your information, EDS and Hughes were purchased what? 20 years ago. Like it or not, current management did the right thing and divested both as they should have. Both also brought in a healthy dose of capital when GM needed it. Blame Roger B. Smith if you still have a problem with that! FIAT? Well as I know I explained on here at least once before, FIAT was about fixing GMEurope prior to the GM-DAT deal. If it were not for the problems surfacing back in 2005, the deal ultimately could have been a success. However, GM's problems were very big and they could not afford the distraction or potential obligation of try to sort out FIAT if the put was exercised. In the end given the powertrain advances, the whole thing was a wash. Other companies? Ford and Chrysler have not been exactly prosperous this decade and for many of the same legacy problems GM has in the US. Product? To me at least, the product coming out of GM the last few years looks solid, profitable and well accepted in the market. The product in the pipeline, also looks exceptional and when they were planned should have been spot on target. I have always said, it takes a lot of time and money to turn around a car company. Given what resources GM and Wagoner have had, there is not much else he could have done outside of reorganizing under a bankruptcy which realistically was out of the equation. If Wagoner goes and Fritz takes over, Wagoner's plan will continue for the most part except all the things he could not do will likely be done under government oversight. Maybe GM will also fix the US industry and take on and liquidate Chrysler. GM needs to be allowed to do in the US what Wagoner and his team have done so brilliantly with Daewoo and China. I also give Wagoner a lot of credit for keeping the Volt program on track even as the rest of the company in the US has been put on hiatus. http://www.cheersandgears.com/index.php?showtopic=26988 http://www.autonews.com/apps/pbcs.dll/arti.../812080320/1200

Not to take anything from Mullaly who I like and believe has finally tamed the beast over there, but you need to step back and rethink what you wrote. If not for the 30 billion set of loans Ford took on 2-years ago, Ford would be bankrupt or bailed out by the Feds already. Step back to where Ford was 10 years ago, the company is a shadow of its former self today. In the US it is 1/2 the company it used to be. Its product lineup is not complex in the US because of that. It has only one division. Lincoln and Mercury are after thoughts at this point. PAG is gone and Volvo should be gone as well. What's left. Mullaly gets credit for imposing dicipline and sticking to a plan. But the plan is a no brainer and not very complex becuase the company really only has to juggle 1 brand. Adopting the Euro vehicles is also a no brainer becuase that is where the fleet is heading in the US. Plus they are better looking cars. Now Wagoner and his team has done a very good job at trying to right this disaster called GM in the US structurally given the limited resources since he has been CEO. I cannot fault him much for his strategic decisions. Since he has been CEO GM has been chasing one crisis after another: Scattered organization (VSSM, 1 engineering center) Unfunded pension (fixed) 2001 Recession 911 Escalating healthcare cost (White collar fixed, UAW VEBA) Too many dealers (condolidation in place (BPG) Too many brands (Olds) Unprofitable cars (Malibu, CTS, Crossovers) High labor cost (07 UAW contract) Katrina Dephi CAFE 4 dollar gas And now the credit crisis. The damn company could no catch a break. If the last two had not happened and GM were to have played out the rest of the plan, the company could have been on its way to finally righting itself in the US. The truth is, the 900 were to save the company and provided the funding to fix the car side. Nuff said on that one. With bankruptcy "not" an option to fix the company, Wagoner gave it a fighting chance. Maybe now that the government is likely to oversee the bailout will the company make the deep cuts they were never able to do before. PS: at the time the FIAT deal was spot on. PS2: BTW most of those distractions such as Hughs, EDS made a lot of money when they were spun off.

Guess who killed the electric car? That is all you need to know.

http://abcnews.go.com/Video/playerIndex?id=6315870 More Peter Morici type crap here - Watched it this AM. It starts about 6 minutes into the video. Come on - What insight could David Brook, Robert Kuttner and Arianna Huffington, have on the auto world.

http://www.washingtonpost.com/wp-dyn/conte...8112002972.html Read this garbage! You would swear Ford was still building the Model T and GM the Corvair. This is little truth in his assesment of the US companies.

Just wait - Henry Waxman (LA, Beverly Hills, CA) replaced Dingell (from MI and a friend of the Big 3) on the House committee that oversees the auto industry. I would spend some time learning about him. http://en.wikipedia.org/wiki/Henry_Waxman GOP urges Waxman to drop support of California emissions limit David Shepardson / Detroit News Washington Bureau WASHINGTON -- Republicans wasted no time in urging the new chairman of the House Energy and Commerce Committee to back automakers. House Republican Leader John Boehner of Ohio wrote the new chairman of committee, Rep. Henry Waxman, D-Calif, on Friday urging him to reconsider his support a bill to allow California and 13 other states to impose a 30 percent cut in tailpipe emissions by 2016. The letter came a day after Waxman defeated Rep. John Dingell, D-Dearborn, who had been the top Democrat on the panel since 1981. http://detnews.com/apps/pbcs.dll/article?A...449/1148/AUTO01 That is only part of it.

Not many on here are going to like the answer but congress should set a floor on the price of fuel and limit or control the tax deduction for vehicle usuage for business reasons. The public will need an incentive. The recent swings in fuel price hurts the planning at these companies.

GM's biggest problem is trying to convince the public and congress that launching the gas guzzling, high margin GMT-900 as the savior of the company in light of $140bbl of oil was just a bridge loan to the Volt - which is very suspect. However after watching the press coverage of the hearings, the Volt's good will may be just what saves GM.

No-GM does not break it down. - However the sales collapse is hurting GME based upon 3Q results and GME is still paying for this 10 year restructuring. GME in the last quarter spent a billion more than it took in. But without knowing how much GME has in the bank it is tough to know what their liquidity position. It is likely sales will continue to errode further in Europe.

And Opel has not made a dime in 10 years.

This is a legal strategy to protect the assets if or when GM-NAO files for bankruptcy. Only GM NAO or GM US would file for bankruptcy. It would be similar to what Delphi did in 2005. Given the circumstances this is standard MO. GM NAO faces two possibilities if they file. 1) If they can get financing, they will restructure the NAO operations only and preserve GM. 2) If they cannot get the financing lined up, NAO will be liquidated and something else will emerge as you discribed. i.e a new company.

When people cannot offer specifics, facts, proof, real solutions or a good rationale - I have always called it as I see it. Since I reared my "ugly" head from oblivion I have at least offered some of the above as I always had (Like it or not)!

Please - Do not BS me. There is nothing significant in what you say.

Wait and see! Such prophetic words since it has been in discussions for months. $25B has already been allocated and appropriated under the Energy Independence Act of Dec 2007. If not in legal name - today's results at GM and Ford illustrate that both companies are bankrupt. Let me explain, GM has about a month worth of cash before operations are closed. October is already done and GM probably blew another $2b. GME after a decade of restructuring still cannot make a penny. Such pride! Can't make it on your own and hoping for a bailout. GM and Ford will get it because subsidizing these companies will keep jobs when the country most needs it. Not because it is deserved.

Even if GM implements the planned operating actions that are substantially within its control, GM's estimated liquidity during the remainder of 2008 will approach the minimum amount necessary to operate its business. BANKRUPTCY Looking into the first two quarters of 2009, even with its planned actions, the company's estimated liquidity will fall significantly short of that amount unless economic and automotive industry conditions significantly improve, it receives substantial proceeds from asset sales, takes more aggressive working capital initiatives, gains access to capital markets and other private sources of funding, receives government funding under one or more current or future programs, or some combination of the foregoing. BANKRUPTCY The success of GM's plans necessarily depends on other factors, including global economic conditions and the level of automotive sales, particularly in the United States and Western Europe. BANKRUPTCY Personally - I am having a really hard time seeing what is so funny. The above is what GM stated today. The only words I added are in bold.

When GM had GMAC they had $100+ billion of finance debt on its books plus automotive debt. Toyota has NO appreciable automotive debt however they do carry their finance debt just like GMAC once did. GM still has $30-40 billion in automotive debt they carry. That is the difference.

You have said a lot and it only further illustrates, you do not grasp the economic situation at hand. Finance 101: GMAC does not have the cash. Lending standards across the board have been irresponsible, hence the recent melt down of the global finance business and subsequent action by the government to take over banks and money injections by the central banks. The liquidity in the system is lock-up. If GMAC had been more responsible in the past, maybe its credit rating would be different resulting in a better cash position and its lending practice less strict right now. However, what money GMAC does have, since FICO is still the generally accepted industry risk model, the company will lend to customers that have more or less excellent credit history above 700 depending on rating agency (app 50% of poplulation). Given the situation at GMAC, that is responsible. And BTW - The housing market bubble collapse was initiated by defaults on sub-prime mortgages and the rest is history. Over the past month, this has been well documented. Tight credit is an industry problem - USA Today article published this morning. Finally - I just read in the WS Journal, even American Express is having problems with credit card debt. Late payments, and debt deemed uncollectible doubled in the past year. AmEx in the same article stated they will be restricting credit limits for those that are risky and carry a balance as well as change their charge card policy for new customers. They are not alone as Chase and Capital One are having similar problems and taking similar action.

"requiring more resonsible lending standards" were call for during this credit crunch. This is why Paulson was on his hands and knees begging Pelosi to pass the $700 billion bailout bill. People and companies thought it was their right to have not only credit but cheap credit if for buying a home with no money down or rolling three car loans into a new upside down 8-year note. I think we have seen where those "unreasonable" lending practices have gotten us.

There is $25 billion that has been authorized by congress to lend to US auto operations that have plants more than 20 years old (The CAFE money). The Department of Energy needs to write the rules to see who is eligible for the funds. That will take time and let me estimate about a year. Strings will be attached to those loans such as the viability of the company. Is Chrysler viable? They have not invested in product over the past year. I was also told their manufacturing facilities (GA, powertrain) are not receiving the capital investment they need for the long term. If this deal goes through, GM gets Chrysler's cash asap to hold them over until the DOE funds are released. Without Chrysler on the receiving end, GM could pickup a bigger share. It is possible, this time next year, GM could have $20 billion additional funds in the banks including what they received from Chrysler. Also - if a deal goes through, with all the jobs at stake, GM can argue they are "Too Big to Fail" and get additional low cost funds from the government independent of the CAFE money. It has been 3 months since GM released a financial report and right now we have no idea how much cash they have on hand. I suspect it may be a lot worse than we are lead to believe even factoring in the line of credit they tapped into. GM could be left with about 6 months cash with all things being equal. All things are not equal right now.

And you might as well add GM and GMAC's assets being auctioned off in that same firesale. For good or bad - GM and Cerberus are in this together. If one fails, so does the other. Something else you seem to forget is, GM approached Daimler about this two years ago and if the recent reports are correct, GM approached Cerberus this time.

This really is not a heard concept to understand. NY Times Article GMAC, the former financing arm of General Motors, has “limited if any access to funding” for its mortgage and auto lending units, its chief executive, Al de Molina, has told employees. GM still ownes 49% of GMAC and GMAC is caught in the middle of the housing crisis which they helped create resulting in this global credit crisis. More than likely, GMAC is on the cusp of bankruptcy. I fail to see why, you choose not to look at GMAC in the same light as Lehman, Bear Sterns, Washington Mutual, Indy Mac, Merrill Lynch, Wachovia . . . What did GMAC do (even when owned fully by GM)? They lent money for cars and houses, bundled the loans and sold them off as structured investment vehicles. Today that is called toxic debt. We as US tax payers are now on the hook for this toxic debt when the Treasury gets around to buying it in an attempt to freeing up the capital markets. GM is caught between a rock and a harder place without access to cash. Cerberus on the other hand was sold two white elephants for $21billion. When GM announced its latest restructuring plan in June, they were banking on a 14 million market. The current market estimates are two million lower than that. The only way I can characterize this situation is by writing it is UGLY. Without a drastic money infusion, GM might not see 101. GMAC 6 months 2008 Performance

That makes no sense - really. Cerberus/GMAC is to blame for all of this i.e. Your loss of commission? GM and big segments of this industry has been living on borrowed time because of cheap credit. This is not some demented conspiracy by Cerberus to force GM's hand. That is absurd. The US auto market has been inflated for years because of cheap leases, idiotic lending practices that are finally STOPPING. You know as well as I a good number of your customers should not be getting the loans and yet they got them. Well that has stopped as far as GMAC is concerned and likely would have stopped given GM's poor credit worthiness if they never sold the 51% of GMAC to improve the credit worthiness of the company. Again I say there is a credit crunch going on, i.e. restricted credit availability. Given what is going on right now in the global economy, I believe it is the correct decision. All those cheap leases you were peddling, are money loosers for GMAC including all those upside down loans. You have ranted on here for years about GM management and yet, you were the crack dealer doing GM's bidding. It is over. It is freaking sad, what has happened to the US economy, and the auto industry. But this economy will not be turned around in a year or two. I fear for what will happen to GM Much like Custard, this is GM's last stand without a government bailout. Personally I have yet to fully formulate an opinion of what GM plans to do because I have yet to see anything concrete. I can only speculate it is about cash and eliminating Chrysler.

The simple answer is NO. The banks do not trust each other. LIBOR, other interest rate indexes Updated 10/15/2008 This week Month ago Year ago Bond Buyer's 20 bond index 5.47 4.54 4.48 FNMA 30 yr Mtg Com del 60 days 6.44 5.32 6.32 1 Month LIBOR Rate 4.47 2.75 5.04 3 Month LIBOR Rate 4.64 2.88 5.21 6 Month LIBOR Rate 4.26 3.02 5.13 Call Money 3.25 3.75 6.50 1 Year LIBOR Rate 4.17 3.13 5.00 http://www.bankrate.com/brm/ratewatch/other-indices.asp Let's call GM and GMAC what they really are - Sub-Prime borrowers. They are a risky bet. GMAC lives by commercial paper and that market has dried up for them as a means to raise cash. However they are doing the right thing by not lending to other Sub-prime borrowers right now, requiring people to put money down on a car loan, and stopping the upside-down loan practice. This is what is called a Credit Crunch. Toyota and Honda on the other hand are Triple A rated companies.