Quote:
Originally Posted by Extreme4x4
Some of what you say is correct, some is not.
Ask wescoent about GM's asking for a loan, through the same channels that Ford did. What does wescoent know about it?? Lets just say that he is privy to this information, due to the fact that he performs risk assessments for JP Morgan. In other words, he has DIRECT information.
As for Ford completing debt to equity swaps and getting UAW concessions. This is called smart business, and smart money. If they did not take advantage of the huge rise in their stock value, they would be idiots. If they did not pursue the same concessions from the UAW, they would again be idiots. They are maintaining their competitive position through their own actions, not the governments.
Frankly, I am tired of people looking at Ford and GM's situation, and saying that they are the same. It is BS. One is a company doing it on their own (remember that GM was unable to make a suitable presentation to the same bankers that Ford used), and the other threw up their hands, and took the "easy" way out. In other words, one is doing it the "American way." The other is trying to do it the copout way, due to their continued managerial incompetance. One grew up, the other didn't.
We will see if GM "learned their lesson." Paint me skeptical.
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I agree Ford is doing the smart thing to get their debt obligations to the Bank and UAW reduced. They have to if they are going to survive this finacial meltdown and stay competitive with GM. But it was not in their original "visionary plans" and they took these actions in response to GM bankruptcy. UAW and banks are more than obliged to change their agreements with Ford as it is in their interest for Ford to be competitive and survive.
Bankruptcy laws are American laws. GM's bankruptcy went through the American court system. The claims of creditors were considered and dismissed by the courts. So I dont see why this bankruptcy is not the "American way" in your eyes. I also dont see this as GM taking the "easy" way out, when you consider that their CEO and 35% of their executives were fired, their board was dismissed, several thousand employees and plants and dealers were closed, their share holders lost their value.
Maybe you are hung up on the fact that the Govt financed the bankruptcy. Well the alternative was to let GM go to liquidation and let the money lenders feed on the remains of GM. I dont see what would have been so noble and redeeming about that process.
Basically your case of GM's incompetence is based on what a money lender says here on this forum. I have no motivation to vouch for GM's managerial competence and may be his portrayal of the supposed GM loan application process is right, but what about the "American way" of listening to both sides of the story and then reaching a conclusion? As far as I can remember there were stories about Ford approaching the banks for the loan in the media,and how it was critical for them to acquire it. But I cant recall even one story in auto or finance media about GM seeking loans and their motivation for it. If you can dig up stories that can detail when and why GM sought loans and why they were rejected I will be happy to be enlightened. If not I think our debate can only be settled in time. So let us wait and revisit this in 12 to 18 months.