gm filing for bankruptcy

exalted512

http://money.cnn.com/2009/05/31/news/companies/gm_bankruptcy_looms/index.htm

tomorrow at 8 am
-Cody

dane_peterson

And then it comes down to us consumers to bail the government out... by buying GM vehicles. How ironic...

BlueFox

dane_peterson wrote: »

And then it comes down to us consumers to bail the government out... by buying GM vehicles. How ironic...

Don't forget the old saying, "What's good for GM is good for the USA."

obieone

I got a form letter from those a**holes over the weekend. And they were actually citing their biggest vehicles, as examples of why their brand is so great. With this admin., the LAST thing I'm doing is buying a gas guzzler!!! I'll end up paying for 3 times.
1. Buying a vehicle that I DON'T need- I've already got 2 of their products in my driveway
2. Buying more gas than I need
3. Paying some STUPID 'green' tax, that I KNOW is coming!

This reminds me of those panhandlers in San Diego- "Well, what did you do with LAST $9 billion I gave you? Bought booze with it, didn't you!!!"

mantis

I firmly believe that if over the last 25 years the American car companies would have made a better product, this would not be happening.

Dan

oifvet0608

The government now owns yet another large American corporation. Does anyone else see where this is headed...

Before anyone questions my patriotism or my words I'm in Iraq right now, riding in a GM vehicle...but I own a FORD, HAHAHAHAHAHAHAHA!!!

obieone

oifvet0608 wrote: »

The government now owns yet another large American corporation. Does anyone else see where this is headed...

Before anyone questions my patriotism or my words I'm in Iraq right now, riding in a GM vehicle...but I own a FORD, HAHAHAHAHAHAHAHA!!!

KEEP posting bro. It let's us know your safe.:)

ken brydson

Just saw a new Camaro today in person. Man it looked nice. Might bring me back to the Bowtie.......

Jstas

ken brydson wrote: »

Just saw a new Camaro today in person. Man it looked nice. Might bring me back to the Bowtie.......

Kinda like this one?



Yes, the wheels were actually stolen and the jack was from a Range Rover.

sucks2beme

Jstas wrote: »

Kinda like this one?



Yes, the wheels were actually stolen and the jack was from a Range Rover.

Damn Mustang guys!:eek:

That's just wrong.
The new Camaro is about the only new car that excites me.
I really loved my 1969. The state police loved that car too.
They pulled me over to do a "safety inspection" about twice a month.
Measure the rear bumper height, check the exhaust, tire depth.
It didn't give me a warm a fuzzy for the fuzz, that's for sure.

dane_peterson

mantis wrote: »

I firmly believe that if over the last 25 years the American car companies would have made a better product, this would not be happening.

Dan

Agreed. There's no turning back now though... it would take GM many MANY years to regain the reputation as a quality manufacturer. The investment isn't worth it.

markmarc

A couple of thoughts:

I find it so ironic that so many in here **** as manufacturing jobs leave our country, yet don't like the fact that the gov't is trying to save manufacturing jobs, which is key to a healthy economy.

What would be the cost of having to rebuild the economy of those areas if GM and Chrysler disappeared? I guarantee far, far more than the $60 billion the bankruptcies will cost, and the results won't be as good.

During WWII, the gov't basically ran the big three, telling them what to build, how many to build, and when it was needed. Whether you like it or not this is economic warfare, and we would be wise to recognize that the reason Japan, Germany, and Korea has auto factories in the USA is that it is economically viable. Once out of bankruptcy, GM and Chrysler will be on the same footing as the foreign competition.

History shows that countries that have a manufacturing base grow, while those that don't stagnate. Remember, we are spending 1/20th on these two corporations compared to getting Saddam. All the while employing both directly, and indirectly 300,000 AMERICANS (that doesn't include the small businesses that are open because of those factory workers). Seems like a far better usage of my tax dollars both short and long term.

sucks2beme

I'd like to buy quality goods made in the USA. Where does one find them?
Until someone comes along and puts their foot down, it won't change.
They don't even want to use U.S. truck drivers to haul stuff up from Mexico.
They sent a lot of my company's jobs to India. And they aren't doing a good
job, but boy don't they work cheap. I don't know how to fix it. But unless
someone with a real set of gonads show up in charge soon, it's going to get a lot worse.

shack

I was never in favor of the Govt bailing out GM. They could have filed for Bankruptcy without the help of the US Govt, the Canadian Govt and UAW. They could have restructured like many in the past have done...and come out leaner...and profitable. They could have sold parts of the company as going concerns...either of which would have been better IMO. I know arms of the US Govt can accomplish great technical feats (NASA, the US military, CDC, etc...)...but I don't trust them to do it economically or profitably.

And the last thing that gives me absolutely NO CONFIDENCE they can pull this off....

http://finance.yahoo.com/family-home/article/107136/The-31-Year-Old-in-Charge-of-Dismantling-G.M.?mod=family-autos

I'm all for new ideas and the enthusiasm of youth...but this is one of the dumbest moves I have ever seen. I am a firm believer that one must have at least a fundamental working knowledge of something to fix it. Theory is fine…but first hand experience is more important than intellect and the knowledge of macro/microeconomics (although all are necessary to do the job).

GM would have had a much better chance of success as a Fiat subsidiary.

I hope I am wrong. Only time will tell.

bobman1235

markmarc wrote: »

A couple of thoughts:

I find it so ironic that so many in here **** as manufacturing jobs leave our country, yet don't like the fact that the gov't is trying to save manufacturing jobs, which is key to a healthy economy.

Everyone defending the big 3 have to get their arguments straight. Half of you talk about where the company's headquartered and all that matters is whose GDP is being contributed to, the other half argue about manufacturing jobs (which foreign manufacturers have millions of in this country, which makes the argument stupid).

obieone

I heard a GREAT question today on the radio. It came from a Ford employee.
"Even though we took no bailout $$$, and are viable, we CAN'T compete with the government. Where does that leave us?"
It's a legitimate beef, IMO.
If Chrysler & GM are going to be stripping their operations, and basically selling their current inventory at COST, then HOW does Ford compete.
Ford business practice, from what I've observed over the years, is to sell a similar product, but for less $.
Does GM have higher legacy costs, because they've always been the biggest of the 3?
It seems like Ford is being punished for doing it right-and I'm no fan of Ford.
Not yet anyway.

wingnut4772

xcapri79 wrote: »

No the government wants Ford too. American capitalism is gone with a whimper because of the "sheeple" of this country.

It is very sad that the Russians have to tell us this because this is the change we got.

Amen! I can't believe what is happening to this country

markmarc

bobman1235 wrote: »

Everyone defending the big 3 have to get their arguments straight. Half of you talk about where the company's headquartered and all that matters is whose GDP is being contributed to, the other half argue about manufacturing jobs (which foreign manufacturers have millions of in this country, which makes the argument stupid).

Bobman:
You need to look at the big picture of what is going to drain your tax dollars more, a $60 billion bailout? Or, a couple of hundred billion to support a huge area of tremendous unemployment?

Yes, foreign manufacturers have tremendous amount of jobs, but not as many as American companies. Second, American companies keep a far greater portion of their profits here in the USA. If you look at the history of US manufacturing you'll see a direct connection between the rise of trade deficits and the loss of domestic manufacturing (yes, oil is a large chunk).

Then, consider the potential of future large scale wars. We need large manufacturing that can quickly be converted to defense needs. Look at Britain during WWII, their manufacturing industry had already been marginalized. Guess who had to supply them?

Nobody wanted this to happen, but it's where we are at. We've poured $150 billion into AIG, all because we were foolish enough to forget the lessons of the economic panic of about 1910 and re-legalize a form of dubious trading. Greenspan was convinced Wall Street would police itself. That worked out really well :>(

As for Ford, they are reaping the rewards of buyers that refuse to look at GM or Chrysler. If they were smart, they'd be advertising like crazy that ""Free of taxpayer support". truthfully, at some point I believe they'll get at least some grand tax break for staying out of the gov't coffers. Plus, they'll get the UAW to make things even with the other two.

ben62670

Ford

PhantomOG

markmarc wrote: »

Bobman:
You need to look at the big picture of what is going to drain your tax dollars more, a $60 billion bailout? Or, a couple of hundred billion to support a huge area of tremendous unemployment?

That's your opinion, not a fact. The auto manufacturers could have and should have gone through bankruptcy on their own and restructured on their own.

Capitalist companies make decisions on profits and the bottom line. If they can't make a profit they go out of business as they should. This is the beginning of the great socialist experiment of our time and it disgusts me to the core.

Why can't people see that if you don't allow people to fail, no one can succeed?

Everyone is talking like if the government had allowed the auto industry to file bankruptcy on their own all the manufacturing plants would have just up and disappeared. That's not the case. The dipshits running those plants would lose their jobs and smarter people who know how to run a business would buy up the worthwhile investments and still provide jobs.

AsSiMiLaTeD

PhantomOG wrote: »

That's your opinion, not a fact. The auto manufacturers could have and should have gone through bankruptcy on their own and restructured on their own.

Capitalist companies make decisions on profits and the bottom line. If they can't make a profit they go out of business as they should. This is the beginning of the great socialist experiment of our time and it disgusts me to the core.

Why can't people see that if you don't allow people to fail, no one can succeed?

Everyone is talking like if the government had allowed the auto industry to file bankruptcy on their own all the manufacturing plants would have just up and disappeared. That's not the case. The dipshits running those plants would lose their jobs and smarter people who know how to run a business would buy up the worthwhile investments and still provide jobs.

Agreed

markmarc

Phantom:
Right now without the gov't there is no private entity available for financing the bankruptcy, period. It would have been Chapter 7 time, instead of 11. Plus, the gov't would have been on the hook based upon the pension insurance plan. That would have costed more than the total investment now.

I've got news for you, pure capitalism when it comes to big corporations died decades ago. They've been getting special tax breaks and laws since WWII. Look at the military-industrial complex, communications industry, etc. etc..

By all accounts these companies have failed, but bankruptcy allows whether public or privately assisted, the opportunity for a rebirth. That is good, or at least better than the alternative.

shack

PhantomOG wrote:

The auto manufacturers could have and should have gone through bankruptcy on their own and restructured on their own.

My thoughts...as stated earlier

PhantomOG wrote:

Everyone is talking like if the government had allowed the auto industry to file bankruptcy on their own all the manufacturing plants would have just up and disappeared. That's not the case.

A great example is what is going on now. There appears to be a non-automotive investment group that is very interested in buying the Hummer brand as a going concern. There is also really good interest in Opel and Saab in Europe. IMO GM could have sold these brands on their own. I might actually keep the partnership with Daewoo just for the ability to quickly bring small fuel efficient cars to the US market. Kill Saturn (or sell it), keeping one or two of the of non-Opel vehicles like the Sky (especially since the Pontiac Solstice is gone as well) and rebranding them as Chevys. Merge Buick into either Cadillac or Chevy. Get rid of either GMC or Chevy Trucks by merging one into the other. Shut down the most inefficient factories and move to the newer ones (if that means moving from places like Detroit to the new Saturn facilities...so be it). Narrow the product line (especially in the truck and SUV line-up) to 3 Caddys, 2 Buicks, 4 or 5 Chevys and 2 Corvettes (make the Sky a baby Corvette - it worked for Porsche with the Boxster) and I would even limit the trucks and SUVs to one brand (maybe excepting the Escalade - because we want the pro athletes to still have something to drive besides Bentleys). Deal with the Unions and creditors under chapter 11. IMO, GM could have done something similar to this WITHOUT the help of any govt or Union. In 6-18 months they could have emerged as a lean company without all the baggage of the past. Some jobs would be lost, but maybe...just maybe...those jobs could be regained as the company prospers.

As I said...I have NO confidence in the ability of a govt to run a company.

Hawkeye

I've been against all the bailouts. But since our elected leaders have chosen to disregard the will of the people, the least they could have done is close the plants in foreign countries. I have a difficult time swallowing a bailout and the cars will be made in China and brought here to sell to all the unemployed people.

That Pravda article hits the nail squarely on the head. Good god, where are we going?

Gordon

F1nut

Good god, where are we going?

To Hell, led by Satan himself. Welcome to change we can believe in. :rolleyes:

Danny Tse

markmarc wrote: »

I've got news for you, pure capitalism when it comes to big corporations died decades ago. They've been getting special tax breaks and laws since WWII. Look at the military-industrial complex, communications industry, etc. etc..

I hope the Feds really, I mean REALLY, look at the books of these auto companies and get those pork out. The car industry, if you look at it on a worldwide basis, is still ultra-competitive, with many markets (think China) waiting to be conquered. US auto manufacturers need to be lean and clean, and with a world view, to compete with competitors such as Toyota, Honda, Hyundai (I believe it's the 4th biggest automaker in the world now), etc.

For the last 13 months or so, I was involved in a couple of rate cases that provide subsidies to certain Californian telecommunications companies. The State "guarantee" these companies a very good yearly rate of return (certainly better than what you and I can get on our investments) for the next several years. Pretty good deal if you can get it. We had to disallow some of what these companies' claimed as expenses because they were just pure pork. We even studied the compensation/benefits arrangements of the auto industry as comparison to what these telecom companies were paying to their employees. It was certainly an eye opener.

PhantomOG

I can think of no other entity better suited to cut out pork than the US government... :rolleyes:

Danny Tse

PhantomOG wrote: »

I can think of no other entity better suited to cut out pork than the US government... :rolleyes:

State governments as well. Being someone coming from the private sector, government finances is like "fuzzy logic" and "new math" rolled into one. Unfortunately, they're not run like private companies, they face no competition, and there's an income stream no matter what happens....which breeds certain attitudes into some government employees. Believe me, the fiscal year is coming to an end here in the CA State government, and we have been told to blow out the funds that we haven't used. I don't think any private companies, nor your own household finances, are run like that.

Danny Tse

Latest news is that Hummer will be sold to a Chinese company. I wonder if this is the Chinese company that Honda was suing for pirating the design of its CR-V.

DETROIT – General Motors Corp. took a key step toward its downsizing on Tuesday, striking a tentative deal to sell its Hummer brand, while also revealing that it has potential buyers for its Saturn and Saab brands.

GM has a tenatative agreement to sell its rugged Hummer brand to Sichuan Tengzhong Heavy Industrial Machinery Co. of China, said a person briefed on the deal.
The Detroit automaker announced Tuesday morning that it had a memorandum of understanding to sell the brand of rugged SUVs, but the buyer's identity was not released. A formal announcement of the buyer was to be made Tuesday afternoon.
Sichuan Tengzhong deals in road construction, pplastics, resins and other industrial products, but Hummer would be its first step into the automotive business, said the person briefed on the deal. The person spoke on condition of anonymity because the details have not been made public.

GM said the sale will likely save more than 3,000 U.S. jobs in manufacturing, engineering and at various Hummer dealerships.

As part of the proposed transaction, GM said, Hummer will continue to contract vehicle manufacturing and business services from GM during a transitional period. For example, GM's Shreveport, La., assembly plant would continue to contract to assemble the H3 and H3T through at least 2010.

The automaker also said Tuesday that it has 16 buyers interested in purchasing its Saturn brand, while three parties are interested in the Swedish Saab brand.
Chief Financial Officer Ray Young told reporters and industry analysts on a conference call that GM is continuing to pursue manufacturing agreements with a new Saturn buyer.
GM would like to sell the money-losing Saturn brand's dealership network, contracting with the new buyer to make some of its cars while the buyer gets other vehicles from different manufacturers.

At the same time, bridge loan discussions with the Swedish government are progressing, Young said.

GM, which filed for Chapter 11 bankruptcy protection in New York on Monday, is racing to remake itself as a smaller, leaner automaker. It is hoping to follow the lead of fellow U.S. automaker Chrysler LLC by transforming its most profitable assets into a new company in just 30 days and emerging from bankruptcy protection soon after.

But GM is much larger and complex than its Auburn Hills-based rival and isn't up against Chrysler's tight June 15 deadline to close its deal with Fiat.

Sharon Lindstrom, managing director at business consulting firm Protiviti, said the companies pose different challenges. But as with Chrysler, she notes that the Treasury Department made sure many of GM's moving parts were in order ahead of time so a quick bankruptcy reorganization might be possible.

"They had a lot of their ducks in a row because the terms of the government financing forced them to get all the parties to the table in a very, very short period of time," Lindstrom said.

In addition to its plan to sell the Hummer, Saab and Saturn brands, GM will also phase out its Pontiac brand, concentrating on its Chevrolet, Cadillac, Buick and GMC nameplates.
Separately, the German government said Tuesday it paid out the first euro300 million ($425 million) in bridge loans to GM's Adam Opel GmbH division. The loans are part of a deal to shrink GM's stake in Opel and shield it from GM's bankruptcy protection filing in the U.S.

Over the weekend, the German government agreed to lend Opel $2.1 billion. The loans are part of a deal in which Canadian auto supplier Magna International Inc. and Russian-owned Sberbank will acquire 55 percent of the company.

A sale of the Hummer brand had been expected. Chief Executive Fritz Henderson had said in April that the automaker was expecting final bids from three potential buyers within the month.

Critics had seized on the rugged but fuel-inefficient Hummer as a symbol of excess as GM's financial troubles grew and gas prices rose. Sales at Hummer, which is known for models like the H3 with military-vehicle roots, have been in a steep slide since gasoline prices rose to record heights last summer. For the first four months of this year, Hummer sales are down 67 percent.

GM nailed down deals with its union and a majority of its bondholders and arranged to sell off most of its Opel operations in Europe in order to appear in court Monday with a near-complete plan to quickly emerge with a chance to become profitable.

The government has said it expects GM to come out of bankruptcy protection within 60 to 90 days. By comparison, the judge overseeing Chrysler's case approved the sale of its assets to a group led by Italy's Fiat Group SpA in just over a month. Some industry observers think Chrysler could emerge as early as this week.

During Monday's hearing, GM attorney Harvey Miller stressed the magnitude of the case and the importance of moving GM through court oversight as fast as possible. He noted that the automaker only has about $2 billion in cash left.

"If there's going to be a recovery of value, it's absolutely crucial that a sale take place as soon as possible," Miller said in his opening statement.

The automaker wants to sell the bulk of its assets to a new company in which the U.S. government will take a 60 percent ownership stake. The Canadian government would take 12.5 percent of the "New GM," with the United Auto Workers union getting 17.5 percent and unsecured bondholders receiving 10 percent. Existing shareholders are expected to be wiped out.

Attorneys for GM stakeholders packed the stuffy courtroom well ahead of the automaker's first-day Chapter 11 hearing. U.S. Judge Robert Gerber moved swiftly through the agenda's more than 25 mostly procedural motions.

Gerber set GM's sale hearing for June 30, putting it on a path similar to that of Chrysler. Objections are due on June 19, with any competing bids required to be submitted by June 22.

Gerber also gave GM immediate access to $15 billion in government financing to get it through the next few weeks, and interim approval for use of a total $33.3 billion in financing, with final approval slated to be ruled on June 25. The funds are contingent on GM's sale being approved by July 10. Gerber also approved motions allowing the company to pay certain prebankruptcy wages, along with supplier and shipping costs.

The sheer size of GM makes it a more complicated case than Chrysler.

GM made twice as many vehicles as Chrysler's 1.5 million last year and employs 235,000 people compared with Chrysler's 54,000. GM also has plants and operations in many more countries, meaning it will likely have to strike separate deals to navigate the bankruptcy laws of those places.

Henderson said GM has learned a few things by watching Chrysler's case.
"Certainly the court showed that it can address 363 (sale) transactions in an expeditious fashion," Henderson said at a news conference Monday. "Particularly in our case with what will be a very large 363 transaction."

GM's filing for Chapter 11 bankruptcy protection is the largest ever for an industrial company. GM, which said it has $172.81 billion in debt and $82.29 billion in assets, had received about $20 billion in low-interest loans before entering bankruptcy protection.

jcaut

shack wrote: »

A great example is what is going on now. There appears to be a non-automotive investment group that is very interested in buying the Hummer brand as a going concern. There is also really good interest in Opel and Saab in Europe. IMO GM could have sold these brands on their own. I might actually keep the partnership with Daewoo just for the ability to quickly bring small fuel efficient cars to the US market. Kill Saturn (or sell it), keeping one or two of the of non-Opel vehicles like the Sky (especially since the Pontiac Solstice is gone as well) and rebranding them as Chevys. Merge Buick into either Cadillac or Chevy. Get rid of either GMC or Chevy Trucks by merging one into the other. Shut down the most inefficient factories and move to the newer ones (if that means moving from places like Detroit to the new Saturn facilities...so be it). Narrow the product line (especially in the truck and SUV line-up) to 3 Caddys, 2 Buicks, 4 or 5 Chevys and 2 Corvettes (make the Sky a baby Corvette - it worked for Porsche with the Boxster) and I would even limit the trucks and SUVs to one brand (maybe excepting the Escalade - because we want the pro athletes to still have something to drive besides Bentleys). Deal with the Unions and creditors under chapter 11. IMO, GM could have done something similar to this WITHOUT the help of any govt or Union. In 6-18 months they could have emerged as a lean company without all the baggage of the past. Some jobs would be lost, but maybe...just maybe...those jobs could be regained as the company prospers.

As I said...I have NO confidence in the ability of a govt to run a company.

Shack is right on the money, IMO. At least the the company would have had the chance to emerge and propsper. This way I think they basically have no chance. I'd also be concerned that the situation with GM (and Chrysler to a lesser extent)- just the huge govt. involvement in the auto sector, combined with the increased costs we'll face from the "green" initiatives- may drag down Ford as well. Though they've been getting by, mostly due to smarter asset management, they're not well poised for what I think the future is going to bring for the domestic auto industry.

My 11-yo son (a car fanatic- Don't know where he got that) drew a picture the other day of the "car of the future". It looked like the little smart cars, except with double-humps. He called it the "Obamblama Camel". He said it produces no pollution, uses no fuel and only moves downhill. Everyone will be required to buy one.

shack

jcaut wrote:

He said it produces no pollution, uses no fuel and only moves downhill. Everyone will be required to buy one.

Those already exist...




Of course if you want to go UPHILL...there is always....