Detfan

I Was Wrong About GM Bankruptcy

GM is fine and will be great in the future. They were on track to be profitable THIS year without the economy falling off a cliff. They are now at break even on 10M SAAR, which we will exceed in the coming months. GM will make $5,000 per vehicle more in 2010 than they did in 2004. GM has made all the right moves for several years to posture them for tremendous success. The government involvement, obviously, is very minimal, as I see products coming out on schedule with more beautiful cars coming soon. With the renaissance of great new product launches over the last 4 years, GM's market share has stabilized and retail share is actually increaing now, as people buy the new Malibu, CTS, Enclave, Camaro, etc. GM's comittment to fuel economy has transformed them over the last few years to the company that has more industry leading vehicles in mileage than any other manufacturer. The next successful launch is the 2010 Chevy Equinox, which I drove last week. It gets 20% better mileage than the Toyota Rav-4 and Honda CR-V, and highway mileage beats even the Ford Escape Hybrid. Interior is class leading, with more features included at each trim level than the competition. Yes, the future looks very bright for GM, especially in light of their explosive growth in emerging markets around the world, using their new global platforms that are now the envy of the industry. Look for the stock from the IPO next year to systematically be bought back by GM until we see a private stock holding company again.

7 Reasons Why the New GM Might File for Bankruptcy

Actually GM is in great shape, totally discounting the authors points. The reduction of GM dealers is necessary where there is too much duplication in major cities. GM's rural dealers remain strong, and GM will still have many hundreds of dealers more than Toyota after the reductions are complete.
Union income has already reduced, and is now lower than foreign transplant employes. With all the GM restructuring over the last few years, GM will be making $5,000 per vehicle more than they did just five years ago (source John Holstein, author, "Why GM Matters". GM has gone from being middle of the road in mileage ratings, but now has the most segments of industry leading vehicles in mileage of any manufacturer. GM is already moving way past the imports on getting to the 35 MPG mandate. The Chevy Cruze will get well over 40 MPG. the Chevy Orlando will get well over 40 MPG, and the Chevy Spark will get almost 50 MPG. The electric Chevy Volt will be rated at 100 MPG, and there will be several iterations of the Volt being built by 2012.

SO, I'm not too worried about GM. I just looked at the next industry leading vehicle that GM has launched, the Chevy Equinox, which gets 32 MPG, which beats the Rav-4 at 27, and the CR-V at 28. Industry leading interior and fit and finish, just like most of GM's recent launches.

GM's retail market share has been stable for almost three years now, and is now beginning to increase. Meanwhile, GM is exploding in emerging markets like China, where they almost at a pace of 2 million vehicles sold this year.

Costs are way down, profit is going way up. GM breaks even now at 10 M SAAR, which looks like may happen when June sales get reported next week.

What's an American Car These Days?

American cars are what they always have been. A car purchased thru GM, Ford or Chysler. Nothing has changed. Profits still go to the home country when you buy from anyone else. People who are buying imports continue to weaken the manufacturing complex in this country. Plus, because you can now choose a GM, Ford, or Chysler car, and have it be equal or superior to the import, you can buy American with confidence these days. Why doesn't our government force Japan to open their market (3rd largest in the world) to U.S. cars? Free trade is only free if its equal.