Markham Lee_

Detroit Uses Aid to "Open-Up" Auto Lending: Not Necessarily Good for GM

I don't think these conversations can be constructive if we're attacking each other, or dismissing people unless they're GM fans. At the end of the day this is a mathematical business discussion revolving around dollars and cents, a strategy either makes mathematical sense or it doesn't.

GM was selling cars for a loss during the credit boom, and at present they're dealing with a double edged sword of lower sales volumes and lower revenue per car due to the various incentives they're offering. The company isn't going to recover by selling cars at an even greater loss, especially in the face of lower volumes.

It's not about GM vs. Ford or GM vs. the Germans.

It's about the very simple mathematical fact that you can't get ahead by selling a car for an even greater loss per car, than you were when sales volumes were significantly higher.


-M