[2002 Caddy]

Originally Posted by Slideways

Thank you. Everyone seems to think that 18 months ago GM knew gas prices were going to double by summer 2008 or that they're stupid for not anticipating it. The thing is, nobody knew, otherwise consumers wouldn't have been blind-sided either.

The truth is that we all knew this day was coming for YEARs not months
even CNN first ran "we were warned" (an editorial warning about an oil crunch) in 2006. Economist have been talking about "peak oil" since late 1999.

We knew it was coming... we just didn't know exactly WHEN...
So when as a CEO you face this uncertainty you have two options:
1) The first goes like this... We are making a ton on trucks. Lets milk it for all it worth for as long as we can. Small cars aren't profitable or easy to sell. forget about them. No one likes small cars. Or
2) Option two Lets balance out product mix so that our butts are covered... Lets build a good small car and get as much out of trucks as we can, keep the company nimble and be ready to change the product mix in a heat beat.

GM Management picked option 1... Toyota Management picked option 2
GM is about 15 Billion away from Chapter 11 (and is loosing about 800 million a month... do the math we are a year and a half from the abyss) and Toyota would have to lose about 100 Billion to be in the same spot and even then they are making money (about 500 million a month).