GM extends holiday shutdown, may cut production

[frenstall]

Given GM sales were down 45% last month and probably pretty low this month I would imagine GM could take a month or more off at every plant and not affect dealer inventory.

[Joe in T.O.]

Originally Posted by GMJIM69

I hate to break to you sad sacks out there but the Arlington TX SUV plant will be blowing and going WITH APPROVED COMPANY OVERTIME in December. This is America where LOW GAS PRICES = HIGH SUV SALES. This came straight from the Arlington TX. GM Plant today so it must be so.

Wow, I am surprised at this. Instead of overtime, why not take a little longer to deliver the vehicles?

[Gm_Tooler]

Real Americans clearly favor truck size vehicles when fuel prices are low as evidenced by sales. They buy tiny cars when prices are high, which they liken to a good beating. First automaker who can build reasonably priced 30mpg hwy full size trucks will be golden. That's where I'd put some serious development monies.

Then the UAW could continue to enjoy high pay and lavious perks, plus an add'l week of vacation.

See how easy that was?

[jbernie]

Originally Posted by frenstall

Given GM sales were down 45% last month and probably pretty low this month I would imagine GM could take a month or more off at every plant and not affect dealer inventory.

Well it will have an effect, the dealers wont be over loaded with product they cant sell, they will only be loaded with product that is hard to sell.

Stopping production is good, even if it costs GM money in still paying workers they cant cut utility costs etc and they will be desperate to keep production down on models not selling well so they can keep the sale prices higher than they other wise would be. I know they will be low because dealers are needing to give incentives just to help move something, but the dealers dont need to be stuck with 5X as many vehicles to sell and having that overload forcing even lower transaction prices.

[mike's 01ws6]

Originally Posted by Joe in T.O.

Wow, I am surprised at this. Instead of overtime, why not take a little longer to deliver the vehicles?

The cheapest ways to do it is to shut down. Anything less than two years off will not put people in the jobs bank. Unemployment picks up its portion of the tab for GM. They will be paid sub pay and unemployment. Sub pay makes up the difference between unemployment and 85% of take home pay (pay after taxes, for those that think that they are getting almost a full paycheck, and they still take taxes out. So its actually less than 70% of a normal paycheck, depending on how many dependants you have. Anyhow there is a more than a 60% savings on labor (because unemployment picks up part of the tab), and they also save on what it costs to run the plant. Sub pay comes from a different fund so it might help if they are strapped for cash in other areas, but there is only so much of this money there.

[jlt0x]

Smart, simple move that could save a few hundred thousand dollars.

At a time when the govt is "vetting" the consequences of giving Citibank MORE of the $700b bailout funds after already having giving the financial firm $25b is comedy...eh-hem...at least not for possible layoffs.

?Aren't the US Big-3 only asking for $25b in loans all together? Not $25b each? And they have financial ties to dozens of countries and their bankruptcy would effect 3+ million in the US alone...not counting the financial ramifications in their foreign divisions.

Helping the Big-3 should've been a "no-brainer"; do it! The US automakers have confidence in definite profits within 18 months b/c they've been planning to transfer a huge chunk of their legacy costs to new organization created to handle the retirement & pension funds. They'll be able to ink b/t $5-10b in profits immediately and use that money for development and research.

[goodies]

Originally Posted by jlt0x

?Aren't the US Big-3 only asking for $25b in loans all together? Not $25b each? And they have financial ties to dozens of countries and their bankruptcy would effect 3+ million in the US alone...not counting the financial ramifications in their foreign divisions.

Helping the Big-3 should've been a "no-brainer"; do it! The US automakers have confidence in definite profits within 18 months b/c they've been planning to transfer a huge chunk of their legacy costs to new organization created to handle the retirement & pension funds. They'll be able to ink b/t $5-10b in profits immediately and use that money for development and research.

That's right, $25B total. During testimony last week, Wagoner asked for $10 - $12B, Nardelli $7B and Mullaly $7B.