Why Won't GM Just Go Away? 86 comments
Andrew Snyder
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When Congress sent General Motors (NYSE:GM) its first “bailout” check worth $4 billion earlier this month, few folks thought it would do the company much good.
But even fewer thought the company would be crying for help so quickly.
The taxpayer-funded check has barely cleared the bank and GM’s chief is hinting that Congress’ recent gift of $9.4 billion may not be enough. Not only is Wagoner saying the company may need more money, he is telling us that bankruptcy is still an option.
Just last month, however, he vowed it is absolutely not an option. Which is it?
It is the same old story in Detroit. General Motors is running around touting cars that nobody wants and the UAW is squeezing every drop of remaining blood from the company’s cancer-ridden body.
If you have turned on the evening news over the past few days, you have certainly seen the shots from the Detroit Auto Show. Wagoner has been grabbing any media attention he can to show off his company’s shaky billion-dollar investment, the Chevy Volt. The CEO needs to do everything he can to create demand for a $40,000 electric car when crude prices are plummeting.
But even worse than the Volt’s chances of becoming a bestseller are GM’s chances of solidifying a life-saving deal with the UAW. The negotiations between the employer and its employee representative will not start until Monday, but already trouble is brewing.
Here we go again
Ron Gettelfinger, the UAW’s fearless leader (I mean that in a bad way), told reporters that he wants Obama to remove some of the concessionary terms placed in Congress’ recent bailout legislation. In other words, the UAW does not want to negotiate.
We should not expect the UAW to be cooperative over the next few weeks. But it may not matter. Already, there is at least one bill making its way through Capitol Hill that will lower the requirements and terms of the loan furnished through the Treasury’s TARP.
Talk about changing the rules in the middle of the game. This is one big political fiasco.
When we boil away all the fat, this subject really is not about cars, the Big Three, or American workers. It is about politicians shoring up their next election. The contingency that can deliver the most votes will emerge the winner.
As investors, there are two ways to look at this situation. We can take a short-term stance and be ready to trade the news. Or we can look at the long-term stance and short the heck out of GM.
Either way, investing in GM is less about fundamental value and is increasingly becoming more of a political bet. That is something no investor should be comfortable with. Remember, dollar and cents add up. Politicians do not.
If you thought the GM story ended when it received its bailout, you had better think again. That was merely the end of the first chapter. There is much more on the way.
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This article has 86 comments:
(SA's stupid HTML code keep auto-replacing my text)
It is the freezing of credit markets - thanks to geniuses like the author working on Wall Street - that choked the auto-sales market. The hiking of credit score requirements (up some 20% since Q1 of 2008), and the all but impossibility of leasing finance (which is 20-30% of sales in the US) that have slashed sales. Demand is there IF people can get financing.
As for the UAW, they already conceded a lot of ground, but the real issue for GM is their legacy costs. Previous management put off covering things like pensions and healthcare costs by following the government models like social security which require a growing contributor base when their industry could only employ less people (even if GM still had its market share from the 1950s they would still choke of pensions and healthcare).
I would suggest that Seeking Alpha send the author back to do some actual research on this topic. I could recommend articles in the New Yorker, Forbes and other auto-industry magazines that have a much better grasp of the issues.
Zacks.com
Time to Hit the Car Lots
Thursday January 8, 10:16 am ET
By Paul Raman, CFA
We think it is an excellent time to hit the car lots. Sales are slow, inventories are high, raw materials (steel, chemicals, plastic, rubber) are depressed, and interest rates are near zero. Demand is off due to the credit crunch. Dealers and manufacturers are hurting and are hungry for business.
Despite the bad publicity recently, Chevrolet and Chrysler have some of the best products in the market. The non-Chevy part of General Motors (NYSE: GM - News) must be restructured. Also, Honda (NYSE: HMC - News) has emerged to be a Big-4 player in the US. They work and act more domestic than even Chrysler.
We were disappointed with Ford , Toyota and Nissan , and feel they have tired old product lineups. A strengthening Japanese Yen may force Toyota and Nissan to become the Big-5 and Big-6 in the US. Toyota's quality ratings were the lowest among all models studied, especially for the pickup/SUV part of the product line.
There was an interesting news show on CNBC last nite about China. Their economic energy reminds me of the America I grew up in. Better yet, they're at least 20-30 years away from regulating themselves out of business like we have.
Even IF all the UAW stories were true, even IF they did make $70 an hour, slept on the job, came to work drunk... then how could the quality of our American cars be on par or even better than the foreign makes (which they are)?
Do you realize that not only do we compete with the foreign companies, but we compete with their governments too? EVERY non-American car company is subsidized by their home government. Every one of them.
I have a better idea than just letting GM "go away" (along with the millions of auto-related workers whose sudden unempoyment would have a worse effect than any government loan), how about we get behind our home team and take back what is ours? Let's fight for our manufacturing jobs, let's rise up against foreign brands getting billions form our government to take market share and jobs from us.
Anyone can sit int heir underwear and bang out uneducated opinions on a keyboard. But who will really take a stand, roll up their sleevs, and take this country back?
GOD BLESS AMERICA!
You have a bit of a impaired listening problem. Mr Wagoner never said that bankruptcy was not an option, he always said that it was the LAST option. I am of the opinion that declaring bankruptcy, even Chapter 11, would be the end and quickly lead to Chapter 7. I'm also tired of presenting the reasons that bankruptcy should not happen, I'm to the point of saying let it happen and let the economy crumble. Then people like you would go away.
I find it amusing that the financial "experts" all choose to write about the auto industry instead of their own dysfunctional industry. The auto industry does not now, or never has, passed out $100 million bonuses. The auto industry has never allowed someone like Bernard Madoff perpetrate a crime of $50 billion fraud. The auto industry does not try to make money by shuffling it around and inventing schemes to make something of nothing, i.e., hedge funds. Everyone seems to want to focus on the pittance that the auto received in the form of LOANS, rather than the $700 million GIVEAWAY earmarked for the financial institutions.
Mr. Snyder, do us all a favor and concentrate on something that you have a better chance of understanding, the mess that is the U.S. financial system. And you might want to get your information from somewhere other than CNBC, they also have a vested interest in focusing attention in areas that are not the financial debacle.
GOD BLESS AMERICA!
I hate to bring up the history of the UAW, but it's useful to help understand why we now find ourselves in this dilemma.
There was a time when the esteemed union members used to SABOTAGE the assembly line when they weren't happy with their contracts. This also coincided with the period when Americans began to perceive Japanese vehicles were better built than their U.S. counterparts.
Those people (and the many others who knew about it) should be grateful they're not in prison instead of counting their legacy benefits. And you wonder why Detroit's in trouble?
On Jan 14 11:49 AM Paul Killinger wrote:
> Oh, and if the Japanese government is subsidizing Nissan's loss,
> aren't U.S. Nissan buyers benfiting from this foreign subsidy?
On Jan 14 11:45 AM Paul Killinger wrote:
> Let me ask you guys, say someone buys an American made Nissan. And
> Nissan is posting a loss, along with other automakers. Doesn't this
> mean that all the money generated from this sale stays in the U.S.
> after all, and has the same effect by supporting American workers?
Let’s say your mom saved her money, got a small business loan, and opened a small florist. She invests her time and money, grows flowers, and the business does good. She is able to give good wages to her employees, and that in turn allows them to spend in their communities. Your mom is able to support your family and grow the business, employing more people from neighboring communities. But she can't grow the business without good business first. That is what allows reinvestment. Years go by and many communities are benefactors as the florist pays local, and federal taxes, employs thousands of workers and requires services like carpet cleaning, building maintenance.. All of these services from local communities.
One day, another florist is built across the street. You find that the owner lives in Japan. And that owner was given money from his government to start his florist back home. Now that he wants to expand into the U.S., he is able to build right away because he didn't need to save up for reinvestment. Then you find out that he was given a huge tax break to build his florist here by our government (taxes your mom and employees paid). Not only that, but he has been given a couple of years to do business at a much lower tax rate than your mom currently pays.
His florist hires workers, but he pays them less and offers less benefits. But his flowers cost the same as yours. So with his subsidization from home, aid from the U.S., and lower operating costs than your mom, his florist becomes profitable very soon.
Now that he has these advantages, he is able to spend freely on R&D to build much better flowers. His flowers live longer, smell better, and begin to get a reputation for quality even though he has been in business not nearly as long as your mom.
Your mom wants to compete, but she promised her workers these benefits. And even though her business model built your surrounding communities, she is now being slammed in the media and on Seeking Alpha, and by her own congressmen who give billions to the other florists.
Your mom is told to "do it like them". So she asks for government help, like they do it, and she is slammed even more.
So your mom does it the old fashion way. She works hard and puts in a LOT of her own time and money and she finally has flowers as well as anybody’s in the world. Unfortunately, the perception is that her flowers are bad, and the foreign guy’s florist has the best flowers ever.
Now your mom is losing business even though her product is great. So she begins to cut costs. She lays off workers, starts buying generic coral for home and cancels cable TV. You, as her child, feel the pinch.
Then one day, your sister comes home with some flowers bought from the foreign florist. You explain to her the connection between your quality of life and mom's florist. Her answer is that a friend from school works there, so it's the same thing.
Meanwhile, the owner of the other florist's owner still lives in Japan. Always has, always will He reaps the lion's share of profit and brings it home while still enjoying home sublimation, government health care, and United States tax breaks whenever he wants to build here and start the cycle all over again.
At this point, even when all forists are losing money, it is still better to support the home team. It is a global economy, but we should still support the home team. Just like both basketball teams are on the court, but let's keep our shots going into the right basket. Why shoot for theirs?
And there was a "time" when we were at war with Japan. But we correct things and move on, right?
Today's American car and its world class quality is not a result of sabotoge and lazy workers. Besides, what corporation didn't have insubordination within its ranks at times? Go to alocal car show and see that the American car companies DO have a LOT to be proud of.
They don't write songs about Toyotas and Hondas.
Trying to write fast and trust Word spell checker :)
How did you miss that last DECADE of massive improvements? GM beat BMW/Mini with turbo direct injection, Ford has better hybrids than Toyota, and they both have quantifiably higher quality.
Have you seen a Malibu? Can you spell ZR-1?
With all the problems Detroit faces, pernicious misperceptions from last century may be the worst.
You are the reason the big 3 are in trouble. If the media would give Ford/GM/Chrysler some credit for their quality turn around, maybe public perception would improve. Did you know that Ford beat Toyota in the JD Power IQS study? Probably not, since you did no research on this article. But instead you like to continue to bash the big 3 and state noone wants to buy GM vehicles. Perhaps your research did not lead you to the fact that GM does sell more vehicles world wide than any other manufacturer. Get another job Mr. Snyder!
as for the writer of this story. u should be ashamed for spreading propaganda. this was not a "gift" it was a "loan". let me educate you...loans need to be paid back with interest...gifts dont. if ur going to report then maybe it would be a good idea to report the facts and not make things.
Japan's largest customer is the USA. with the US economy in such a mess (thanks to our banks and the crooks that run them) Japan is in perile. they have been in a recesion for the past 2 1/2 years their government has been supporting their industry and banking with bail out type loans for years only they don't have to be paid back in curency, they get credit points for offering employment, and support government programs such as health care and employee bennefits paid by the government.
On Jan 14 07:25 AM Tradememe wrote:
> GM won't go away because it has got the Too-Big-To-Fail status. What
> is amazing is that Japan with less than half the US population has
> got many more car companies than the US.
Good move to save some cash.
Why bother going to a meaningless show?
The Big 3 are not allowed to sell their cars in Japan.
While the Japanese economy is based on manufacture for export they have effectively closed their markets to outsiders to protect their own.
Who said the Japanese don't prop up their industries.
Ignorant Americans so busy pointing fingers at each other while the competition is kicking their sorry and jealous butts.
At 5% $17B would return $850 M in one (1) year Bingo!!
see the light???
On Jan 14 04:33 PM GovtProfit wrote:
> I for one would like to see the govt make more loans with my taxpayer
> money instead of spending it on pork barrel projects that provide
> no real or lasting benefit. The federal govt can borrow money at
> ridiculously low interest rates (close to 0%) and lend it out at
> 5-8%. Eventually, the govt could stop taxing my earnings, replace
> the banking system, and become self-funding.
Do you have any idea how important GM is to the overall economy, I guess you just don't get it. I hope that someday you are in this same position then maybe you will understand what it is to fight for what you believe in. GM makes a good vehicle I have several, no problems with any of them. Every car maker has trouble of some sort so stop implying that it is only GM. Where are all your comments about the huge amounts given to the banks and AIG? What about the bonuses they immediately rewarded themselved with? Why don't you get a life and perhaps an original idea.
If you think no one wants to buy GM vehicles, take a good look the next time you are driving down the road (that is if you can drive) and you will see just how many people are driving GM vehicles you fool. I own four of them and I am proud to get in every one of them and by the way they have never let me down, start every time and get me where I need to go. So I have no idea what you are talking about. It is people like you who have nothing but negative things to say but have an outlet to the media that help to drag them down. So why don't you just keep your biased opinions to yourself!!!!!!!!
We're talking about a Public Backlash that could become a Revolution Against the Super Wealthy Crooked Wall Street where Money is God and all of the Middle Class is just their Cannon Fodder.
If this all Collapses ..... we will see who Becomes Cannon Fodder.
Revolutions Happen for a Reason. Think about it !!!!!!
And don't forget, while there are many auto names in Japan, many of them are at least partially owned by others.
The "reality check" is needed by you. Your numbers are the inverse of reality. Nissan produced in the US about 70% of what it sells here. Honda is close to the same, Toyota less.
Yes, we know that doesn't fit your agenda.
While the Japanese economy is based on manufacture for export they have effectively closed their markets to outsiders to protect their own.
Who said the Japanese don't prop up their industries. >>>
More propaganda from reality chk right off the union's talking point list.
With the exception of Honda and Toyota, all the automakers in Japan either are or have been partially owned by foreigners. Isuzu, Suzuki, Subaru, Mazda, Mitsubishi, and Nissan all have had large, and in some cases controlling interest bought by outsiders.
Who said the Japanese market is closed?
Gee, Brian, I didn't know that either, and I've got Power's 2008 IQS right in front of me. Toyota averaged 104 problems per 100 cars, and Ford averaged 112. Guess it's you who needs to do more research before you post.
www.jdpower.com/corpor...
Which country can boast that their brands occupy 2 of the top 3 spots for long-term reliability?
Answer: United States.
Per J.D. Power Vehicle Dependability Study, Mercury and Cadillac are in the top 3, along with Lexus. And in 2007, Buick was tied with Lexus for the top spot.
www.jdpower.com/corpor...
2. As of August 2007, which manufacturer had the most recalled vehicles in the U.S. for that year?
Answer: Volkswagen.
According to Business Week, Volkswagen had the most recalls at this time a year ago. The second worst was Toyota.
www.businessweek.com/a...
3. Pick the brand from each group that has the highest initial quality.
a. Answer : Cadillac (better than both Acura and BMW)
b. Answer: Mercury (better than both Honda and Nissan)
c. Answer: Chevrolet (better than Acura, BMW, and Mazda)
This is according to J.D. Power’s Initial Quality Survey.
www.jdpower.com/corpor...
4. Which midsize sedan has the highest initial quality?
Answer: The Chevrolet Malibu has better initial quality than any competitor, including the Honda Accord, Toyota Camry and Nissan Altima. The Ford Fusion also beat all 3 Japanese competitors.
This too is from the J.D. Power Initial Quality Survey, which also reveals that above average are American brands Mercury, Ford, Cadillac, Chevrolet , Pontiac, Lincoln, and Buick. Below average are import brands Acura, Kia, Nissan, BMW, Mazda, VW, Subaru, and Scion (and several others).
www.jdpower.com/autos/...
www.jdpower.com/corpor...
5. Which large sedan has the highest initial quality?
Answer: Again per J.D. Power, the highest quality large car is the Pontiac Grand Prix, beating the Toyota Avalon. Two other Detroit cars that beat the Avalon are the Mercury Sable and Mercury Grand Marquis.
www.jdpower.com/autos/...
6. Which midsize pickup has the highest initial quality?
Answer: The Dodge Dakota has the best quality for midsize pickups, proving that Chrysler too can beat the imports. Both the Dakota and the Ford Ranger beat the Toyota Tacoma.
www.jdpower.com/autos/...
7. Which car is the most economical overall?
Answer: Per Edmunds.com, the premier automotive analysis site, the most economical car in America, taking into account not only mileage but all costs, is the Chevrolet Aveo. The Honda Fit is #3 and the Toyota Prius is a distant #34.
www.edmunds.com/help/a...
8. Which car did the Los Angeles Times describe as “a better car than BMW or Mercedes or Lexus or Infiniti”?
Answer: “Cadillac makes a better car than BMW or Mercedes or Lexus or Infiniti, and that car is the 2008 CTS. No other car in the mass market dares so much as this expressive and audacious bit of automotive avant-gardism.” Dan Neil, LA Times.
www.latimes.com/classi...
9. Which company makes the winner of the 2008 “Green Car of the Year” award?
Answer: The Chevrolet Tahoe Hybrid is the winner of this award. How could a full-size SUV defeat the media darling Toyota Prius? Read the link below and you will discover, “What’s equally eye-opening is that the Tahoe’s 21 mpg city fuel efficiency rating is the same as that of the city EPA rating for the four-cylinder Toyota Camry sedan. ”
Did you catch that? A huge, full-size SUV from Chevrolet that gets the same city mileage as a 4-cylinder Toyota Camry!! Chevy obtained this remarkable achievement through the use of its 2-mode hybrid system, a technology that Toyota does not have.
www.greencar.com/featu.../
10. Which car was selected by the North American automotive press corps as the “North American Car of the Year” for 2007?
Answer: Not only was the Saturn Aura picked by the automotive press corps as better than the Honda Fit and the Toyota Camry, “When a panel of 47 journalists named the Saturn Aura the North American Car of the Year over the Toyota Camry, the vote wasn't even close, 205-89.” Chicago Tribune, 1/15/07
www.northamericancarof...
11. Which car won the same award for 2008?
Answer: GM again crushed the Japanese competition in 2008 when the Malibu received 190 votes to the Honda Accord’s 95. The Accord actually came in 3rd since GM’s other finalist, the Cadillac CTS, received 165 votes.
www.northamericancarof...
12. Which company had a luxury vehicle, a midsize sedan, and a large truck removed from the Consumer Reports recommended vehicles list in October 2007 because of mounting quality problems?
Answer: Toyota’s much publicized quality problems resulted in Consumer Reports actually removing from their recommended vehicles list the Lexus GS luxury car, Camry V6 sedan, and Tundra pickup. This demotion occurred in October 2007.
If you are one of the many Americans who gave up on Detroit’s cars because of a bad experience many years ago, it’s time to rethink your position. Rethink Detroit.
Detroit automakers: 79 U.S. jobs per 2,500 cars sold in America.
Foreign automakers: 33 U.S. jobs per 2,500 cars sold in America.
levelfieldinstitute.or.../
You want facts? Who has the most brands in the top 10 of J D Power durability report for 2008 (instead of the cherry-picked top 3)? The imports make up 6 of the top 10.
Where do the majority of GM's brands lie in the same survey? Below industry average.
Where do ALL of Chrysler's brands lie in the same survey? Not only are all Chrysler's brands below average in durability, they are all below average in the same company's initial quality survey!
Most recalls? That one of yours is outright lie. Ford is in the midst of the largest recall in automotive history, and for any recent year you chose to pick Ford has recalled more vehicles than the VW you are claiming in your post.
Which car was selected as the North American car of the year? Hyundai.
Now before I go on all day dismissing your claims, maybe we should just conclude that if you want to come to the game claiming "facts," you had better do your homework first, instead of just posting someone else's BS.
SOUND TO ME THAT YOU'RE ANOTHER TOYOTA REPUBLICAN FROM THE SOUTH...WHEN SOME GOOD COMES OUT OF DETROIT YOU GO BLIND!
Zacks.com
Time to Hit the Car Lots
Thursday January 8, 10:16 am ET
By Paul Raman, CFA
We think it is an excellent time to hit the car lots. Sales are slow, inventories are high, raw materials (steel, chemicals, plastic, rubber) are depressed, and interest rates are near zero. Demand is off due to the credit crunch. Dealers and manufacturers are hurting and are hungry for business.
Despite the bad publicity recently, Chevrolet and Chrysler have some of the BEST products in the market. The non-Chevy part of General Motors (NYSE: GM - News) must be restructured. Also, Honda (NYSE: HMC - News) has emerged to be a Big-4 player in the US. They work and act more domestic than even Chrysler.
We were DISAPPOINTED with Ford , TOYOTA and NISSAN and feel they have tired OLD product lineups. A strengthening Japanese Yen may force Toyota and Nissan to become the Big-5 and Big-6 in the US. * *Toyota's* QUALITY ratings were the LOWEST among all models studied, especially for the pickup/SUV part of the product line.
And if you want to continue to cherry-pick your data points, why not look at 2006, when Honda won both car and truck of the year? Or 2004 when the Prius won? Or 2003 when the MINI won? Or 2002 when the Altima won?
And we notice you had no comeback for your posted lies about recalls. What happened to all this BS about "facts?" Typical of midwestern koolaide drinkers (See? I can mindlessly namecall as well as you!)
Let's see, Most Dependable full sized pickup, and second place in midsized pickups. As rated by the recognized top evaluation firm in the US.
I think Thad needs to start widening his reading to sources that know what they are doing if he is actually interested in the truth.
Buy American when you can and the quality is nearly the same just like they do in every other country. Quote all the numbers you want but all auto manufacturers have problems - there is no perfect vehicle and the difference is now statistically really in the noise!!
College grads with degrees in accounting, finance, science etc. start in jobs making less than the bloated union workers who have perks that bleed American companies. I'm tired of paying thousands of add-on $$$ up-front for a UAW employees perks.
I hope GM goes out of business. Let the UAW die an immediate death and ask these union pigs to start up their own business and see if they can remain solvent in a recession that might turn into a depression.
There was a time in our history when Unions were needed. Read Upton Slinclair's book, The Jungle and you'll see that Unions were a GodSend because of the abuses workers suffered. Today, it is almost a mirror image reverse. Unions are bloated pigs, unwilling to take concessions, unwilling to reduce their fat, bloated greedy perks and this will be the downfall of GM.
It was interesting to read the sabatoging of auto plants. Sounds like credit default swaps were a whole lot worse and they all knew exactly what they were doing at the time... I'm pulling for armegedoen.
And VW beat GM.
GM introducing the 'Volt' reminds me of when John McCain introduced Sarah Palin. It's something that was done to make a point and look good to the public rather than provide any tangible sort of contribution.
For decades GM alongside other auto manufacturers, foreign and domestic alike, have ignored the public's demand for quality efficient products and instead pushed their own agenda. Now the corporations, workers, and American public pays the price.
Who really cares WHAT sort of automobile one buys or drives so long as it makes sense for them. Grow up, take responsibility, learn something from all this, and do it better next time. Maybe then more consumers will buy American.
Some of you are living way in the past and I suppose that every job environment has negative stories if you want to put them out there. I just know that my husband works hard, does not drink on the job and never misses time.
The Volt is an exciting new product for General Motors how is it not a tangible contribution what is wrong with you people. Bye the way Fandango you are the pig, how could you wish the job loss of so many people I hope you are faced with the same future, you are a first class jerk. If you are so concerned with the money they make why didn't you get a job there, most likely because you couldn't handle it. I'm sure you have no idea how hard they work, you are just a big mouth full of anger and hostility. General Motors and its workers contribute a great deal to their communities and if they were not able to do so it would be a huge loss to each and every community.
On Jan 14 07:51 AM texalpha wrote:
> Why doesn't this author just go away?
There is the key phrase. "Whatever your data."
What that tells us is that you aren't interested in the truth. You have your story and the facts be damned.
Now no where have I ever said GM did not win J D Power awards, or that all its cars sucked. So don't go painting me in the lovely black or white that message boards love so much. GM has a bunch of winners, and cars that I admire.
But that does not change the fact that too many of its supporters, as witnessed here, can't admit that GM has made plenty of mistakes, and continues to do so. And if you want to support a cause or a company, it's best done with the truth. Not by lying about it, as is being done here by several, which is what has caused me to post the corrections that I have.
Yes, Carlos, indeed. You shuld quit narrowing your interests and see what people are saying about 2009 Toyota Camry transmission problems and other comfort/quality/ride issues. And this:
autos.yahoo.com/toyota.../
There are similar complaints about the Accord. Oh, and there are probably some people with issues on Ford Fusions, Chevy Malibu, Saturns, etc. The point is that foreign quality is "perceived" and not actual. So why not do what Japan, Germany, India, Korea, and China do and buy mostly what is produced in their respective countries. For us, that would be the U.S.A.
The only other comment I’ll make is that the PERCIEVED reliability downfall of the domestic industry can be traced back to Government intervention into the industry. When the first CAFÉ standards were passed in the late 70’s, the domestics were manufacturing largely a fleet with large V8’s. No because they were out of touch with the wants of the American market, but because that’s what people wanted. Our fabulously intelligent federal government decided that they would be required to meet a CAFÉ in a short time frame, essentially requiring them to redesign their entire product portfolio in a very short period of time. Anyone who knows anything about automotive engineering knows that it takes some time to develop a car from the ground up, and we’re talking about pre-cad days, guys were still using slide rules. America had to redesign the fleet in couple years, hence, yes they brought out a bunch of crap, like X cars, gas V8’s converted to diesel, multi displacement engines without any computer control etc., a reliability nightmare. But I assure you, Detroit didn’t WANT to make junk, they were forced to by out incredibly inept government, and they haven’t lived it down to this day.
Sorry for the rant….. Carry on.
#1: I'm an idiot -- Hey, it happens.
#2: If the government would stay out of the way of the nation's businesses, we would not be in this mess. But they are, so we are all forced to pay as the company crumbles under the pressure.
#3: GM may have a couple of interesting cars, but thanks to huge legacy costs and a head-in-the-sand management team, profitability will take a lot more than that.
If GM's future is the Volt, good luck. It will not be a profitable car for a decade. Come on.
I stand by my conclusion. GM in its current form will not and should not survive. Uncle Sam is not a businessman. He's a career politician.
On Jan 15 09:58 AM Tony Carlos wrote:
> Hey 30382, you need to start doing your own research instead of simply
> forwarding BS that circulates around the net. Your posting is not
> only old and out of date, it was flawed from the start. And that
> ignores the fact that it was an example of cherry picked data from
> the start.
> You want facts? Who has the most brands in the top 10 of J D Power
> durability report for 2008 (instead of the cherry-picked top 3)?
> The imports make up 6 of the top 10.
> Where do the majority of GM's brands lie in the same survey? Below
> industry average.
> Where do ALL of Chrysler's brands lie in the same survey? Not only
> are all Chrysler's brands below average in durability, they are all
> below average in the same company's initial quality survey!
> Most recalls? That one of yours is outright lie. Ford is in the midst
> of the largest recall in automotive history, and for any recent year
> you chose to pick Ford has recalled more vehicles than the VW you
> are claiming in your post.
> Which car was selected as the North American car of the year? Hyundai.
>
>
> Now before I go on all day dismissing your claims, maybe we should
> just conclude that if you want to come to the game claiming "facts,"
> you had better do your homework first, instead of just posting someone
> else's BS.
On Jan 16 12:29 PM Andrew Snyder wrote:
> Hmmmm... Three common themes here.
>
> #1: I'm an idiot -- Hey, it happens.
>
> #2: If the government would stay out of the way of the nation's businesses,
> we would not be in this mess. But they are, so we are all forced
> to pay as the company crumbles under the pressure.
>
> #3: GM may have a couple of interesting cars, but thanks to huge
> legacy costs and a head-in-the-sand management team, profitability
> will take a lot more than that.
>
> If GM's future is the Volt, good luck. It will not be a profitable
> car for a decade. Come on.
>
> I stand by my conclusion. GM in its current form will not and should
> not survive. Uncle Sam is not a businessman. He's a career politician.
Why should I care? I'm no fan of Toyota, nor do I own one.
Do they have problems? Of course they do. Do they have as many problems as Dodge, Chevrolet, Pontiac, etc? No, not according to any reputable survey company. And I have the facts to back it up.
<<< The point is that foreign quality is "perceived" and not actual.>>>
Show me one reputable survey which rates a Detroit brand as having the fewest problems.
You can't.
>>>slowdown
I could answer all your questions (or you could just research J D Powers on your own) but it appears that you have already closed your mind, so why should I bother? If the only reason you could find for someone wanting to post the factual results is that they hate midwesterners, then you are not worth the time it would take to educate you.
Well, I guess you get to wear the idiot hat again because your claim is a lie.
"This year the bombshell on the list was Volkswagen of America, which recalled more than a million New Beetles because of a faulty brake light switch (in both the 2007 and older lines), and some 58,000 Passats for a fragile vacuum line. The company predicts that only about 30% to 35% of the vehicles in this recall are faulty but advises all owners of affected models to visit their local dealer."
www.businessweek.com/a...
Note the "in 2007 AND OLDER LINES" passage.
So Ford recalls 7 million and VW recalls 1 million, but VW is the recall leader!?
This would all be laughable except that some of you probably believe your own BS.
In mid-December GM placed a full page ad in Automotive news in which amongst other things, they apologized for the poor quality of their products in the past. So apparently now GM, as well as many of it's customers acknowledges they have had quality problems. And yet the message boards are still full of deniers.
"While we’re still the U.S. sales leader, we acknowledge we have disappointed you. At times we violated your trust by letting our quality fall below industry standards and our designs become lackluster. We proliferated our brands and dealer network to the point where we lost adequate focus on our core U.S. market. We also biased our product mix toward pickup trucks and SUVs. And we made commitments to compensation plans that have proven to be unsustainable in today’s globally competitive industry. We have paid dearly for these decisions, learned from them and are working hard to correct them by restructuring our U.S. business to be viable for the long-term."
Tom, give it up. Even GM admits their cars sucked. You only make yourself less creditable by claiming it wasn't so.
(Note that the ad GM ran was not put into general public media, where their actual customers could read their admission, but was limited to an industry publication)
#1- I agree you are a single minded idiot and by doing so you miss out on all the remaining issues that influence the over all big picture.
#2- What you propose is legal theivery. Let the creative crooks in Wall street and the banks steal more with less controls and less regulations like Madoff. Thanks to the crooks that run wall street and the banks we now are in a financial crisis that requires the government to dish out $750B for now and maybe as much as $2T to bail out the banks and financial institutions that made stupid, risky, greedy, and illegal decisions. You need to focus grilling the greedy Banks and scheme Financial institutions. Instead you go after people who are trying to earn a honest living. Perhaps you disagree with their methods, however, not everyone can be a financial genius such as your self. Afer all what is your claim to fame? writing articles? giving financial advise on how to screw people out of their life savings? A financial predetor where there is one winner and many loosers? After the recent facts comming forward we need more government involvement and regulation to keep the theives and crook back.
#3- You say GM has a couple of intresting cars. That shows your ignorance of the subject. GM has several models I would invite you to test drive and see and if you feel the sameway. Chevy Malibu, Impala, Traverse, Tahoe, Suburban, Silverado, notice I did not include the Corvette, I just don't hink you can handle it. I don't want you to have to change your pants. lets try the Pontiac G6, G8, the Solstice, Saturn Aura, Outlook, Vue, Sky. Cadilac CTS and CTSv, STS and STSv better leave the Vs along they are in the same class as the Corvette. How about the Buicks wait until the new Buicks this year. How about Saab? they are verry civilized. and there are many more... I hope you notice the I did not include any econoboxes. well you know those are for the poor people.
Now we come to the intresting subject of legacy costs. With 100 years of history GM is a Mature company and in todays world where GenX, GenY, GenZ, and Gen? compete, each tends to see things their way and their way only. I think you have fallen victim of your generation's single minded, quick do it my way or no other way. It is true GM has a large legacy cost due to their maturity in the industrial world. They are an old company with many thousands of retirees. What if one of these retirees was your father, or your single parent mother, or your brother. It is not unthinkable. What if you worked for a company for 30 ,40 years and at retirement time they told you : Thanks, now take a hike we have nothing for you.
You spend 30 40 years doing things the way everyone else and then all of a sudden things change. OK lets change. Well GM is in one of those times of change now and they need time to complete the change.
Where do you thing the transplants will be 100 years from now? or even 50 years from now. Here is an intresting vision that I think you being a financial predetor will be proud of.
The year is 2059 the economy has taken one severe blow after another for a couple of years now. The transpants like Toyota, Honda, Nissan, Hundai, BMW, and others are loosing money due to lousy sales and the high cost of doing business. They need to maintain their level of income to keep up with the cost including a few thousand retirees. in responce they try restructuring, lay-offs, eventualy they do the math and the decision is to file bankrupcy close plants, sell assets and bail out to another state where another sweethart deal was made and they start up again fresh leaving behind all those people who though things were one way and then all of a sudden things changed. Sounds familiar?
Clearly there are many ways to look at something. Being in the Media you have a method in witch you point of view is broacasted to the masses. If you display a single point of view you are not doing justice to the remaining issues that influence the Big Picture.
Thus the label of a single minded idiot.
On Jan 16 12:29 PM Andrew Snyder wrote:
> Hmmmm... Three common themes here.
>
> #1: I'm an idiot -- Hey, it happens.
>
> #2: If the government would stay out of the way of the nation's businesses,
> we would not be in this mess. But they are, so we are all forced
> to pay as the company crumbles under the pressure.
>
> #3: GM may have a couple of interesting cars, but thanks to huge
> legacy costs and a head-in-the-sand management team, profitability
> will take a lot more than that.
>
> If GM's future is the Volt, good luck. It will not be a profitable
> car for a decade. Come on.
>
> I stand by my conclusion. GM in its current form will not and should
> not survive. Uncle Sam is not a businessman. He's a career politician.
VW, however, is near the bottom of reliability and customer satisfaction ratings, while GM is near the top.
As badly as I loved my buddy's GTI, I didn't want his repair bill when the engine mount broke. (Also, the door panels fell off, and the window lift failed. I'm sure the new TN factory will do better.)
On Jan 15 12:54 PM Tony Carlos wrote:
> <<<GM beat BMW/Mini with turbo direct injection, >>>31october
>
> And VW beat GM.
Not exactly.
VW does tend to reside at the bottom of quality ratings, but they are at the top of customer satisfaction rankings. Look at Strategic Vision's TQI satisfaction ratings for 2008. VW's Jetta tops even the popular new Malibu, and the Rabbit beats out Chevy's class entry. The Eos was beaten by the Solstice, but it beat the Sky. Seems that owners like their VWs in spite of the problems.
As for quality rankings, GM is a bit of a mixed bag. Caddy and Buick tend to be rated highly, while Chevy and Pontiac are typically below average. Seems to suggest a parallel between quality ranking and age of the typical buyer.
I am a fan of VW/Audi, and I agree with what you've said. But I hear enough anecdotes [neighbor's 2006 New Beetle failed yesterday] that the improved VW scores surprised me.
If only GM would make a 300HP RWD HHR SS with 7sp DSG, I would be happy, and nobody would be writing silly stories about GM disappearing.
>>>
Don't get sucked into thinking your desires are necessarily those of the majority. The car you describe would have limited appeal, and do little to assure GM's continuance.
Detroit says that the USA will not buy hatches/wagons, but my working-class street sports an FX35, 2 X6s (3.0 and 4.8), A4 Avant, 530i, 335i, Grand Cherokee, Trailblazer, WRX, etc.
GM's Gamma and upcoming Alpha platforms could make great-handling cars. Combine the efficiency of a turbo-direct injected engine with the compactness of a Jatco CVT, and GM could make a roomy, fast RWD vehicle.
I freely admit I’m an Idiot, I must be, I’ve never purchased a non ford/GM/Chrysler in my life… I’m 53. However, I’ll reiterate, VW held the recall record for 2007 model rear produced cars. You’re stating that a small percentage of the product involved in the recall were actually impacted vehicles typically is the standard for all recalls. Also, many recalls are voluntary, does Ford get demerits because they did a voluntary recall on a half a million mustangs because they felt the passenger side airbag may deploy with to much force and they want to mitigate any POTENTIAL problems and they recall 3 model years of the things, I would say they’re being proactive. And yes, I am an advocate of domestic lines, but I’m an advocate of any US manufacturing as I’m not like many of these Ivy League educated nit-wits that say we can exist on a service led economy, we can’t and anyone who thinks we can is…. Here’s my favorite word…. An Idiot. I try to buy domestically produced anything, and I DON’T shop at Wal-Mart.
Also, as you stated, I didn’t state that the US manufacturers’ didn’t make a bunch of crap, actually if you did read my message, I stated that the US manufacturers’ DID make crap, in the late 70’s through the early 80’s, due to government intervention into their business and their legislation of CAFÉ standards with a timeline that was unrealistic in it’s expectation. To meet those guidelines, yes in fact, Detroit made a whole lot of crap, but, my point is that they have never lived it down, which in my opinion, and remember it’s only an opinion because I’m obviously an idiot, it’s a shame, because we’re exporting a whole lot of US dollars overseas for no good reason, solely due to marketing perception. One other point I’d like to make as long as I’m on another rant….. Most surveys that are used to put any manufacturer in a good light are also crap. JD Powers, consumer reports etc. There are issues with those surveys. 1. they have a very small sample size based on the actual fleet of vehicles (tell me how Consumer Reports can draw a valid conclusion when they sample 3-400 folks who own a Camry when there are 400K or so sold in a year) 2. Samples are easily biased, let me explain…. If you buy a Camry, you’ve been told by everyone that it’s the best product on the planet; JD Powers gives you a call and asks what problems you’ve had, well, you’ve bought the best car on the planet right? So you won’t tell them about the trunk that you have to slam shut because the lid had an alignment problem, you’d look like an idiot…. But, the guy that bought the Ford Taurus, everyone told him he was a moron for buying it in the first place…. So when JD powers gives him a call, he flames the car because the “Damn cigarette lighter quit working”…. Much of this survey data can be manipulated through psychological impact.
A more accurate way of determining reliability of a particular car line would be to see the actual parts usage based on the fleet size, but unfortunately no car manufacturer will provide that data. It would be rather telling though.
Last comment, since 1973, I’ve owned 22 domestic car line vehicles, including a Chevy Citation (total Turd); both used and new with a typical odometer reading of 100-120K when I retire them. I’ve only had one significant service issue other than normal maintenance. A rear main seal on the engine block of my 1987 Ford Mustang, which was out of warranty and Ford repaired under warrantee at no cost to me. In my experience domestics simply are not unreliable and I want to make sure my money goes to US companies, failings and all.
Sorry again for the rant…….
No.
What I'm stating is that the VW recall in 2007 included 2007 models AND MODELS FROM PREVIOUS YEARS. That is a direct quote from the article which was linked in the original post (a Businessweek article) which made the erroneous claim. It has nothing to do with how many cars are actually faulty.
Now there is no breakdown on how many were 2007s and how many were older. So if you have proof of how many 2007 VWs were recalled, then please post it, because what has been posted is bogus. And without those numbers, yours and the original poster's claims are unsubstantiated.