Myths Busted: New GM FAQ

[nsap]

Myths Busted: New GM FAQ
GMI tries to clarify the new GM for readers.
www.gminsidenews.com
July 13, 2009
By: Nsap

In an effort to clarify a vast amount of news and information that has come out of the new General Motors this past week, we decided to put together an unofficial FAQ about the new company to help people better understand what is going on.

What is “New GM’s” name?

Prior to bankruptcy GM was named General Motors Corporation. The new, post-bankruptcy company is named General Motors Company. The remaining parts of the old GM are now being called Motors Liquidation.

Who owns GM now?

GM is now a private company (technically). The U.S. Treasury owns 60.8% of the company, the UAW VEBA trust has 17.5%, Canadian and Ontario governments have 11.7% and the old GM has the remaining 10%.

Will GM ever be publicly traded again?

Yes. The U.S. Government hopes to issue an Initial Public Offering (IPO) on the new company sometime in 2010. When the IPO is issued the new GM will be back on the NYSE.

How is the balance sheet?

Much better. The new GM is claiming $11 Billion in debt, down from over $50 Billion at old GM. $9 Billion of the new debt is preferred stock, which could change under new accounting. Total liabilities at the new GM are now at $48.4 Billion total, which is down from $176.4 Billion on May 31st at old GM. Liabilities include accounts payable, pensions, warranties and more.

What are the labor costs?

Reports are saying that UAW labor costs are down to an average of $45 per hour per employee. That includes retiree benefits and health care costs lumped in. That is down from about $75 an hour prior to bankruptcy.

Which brands still exist?

GM North America will consist of Chevrolet, Cadillac, Buick and GMC. International brands are unaffected by the bankruptcy.

So, Bob Lutz is staying?

Yep. Lutz has been Chairman of the GM Global Product Board for the last few years. He will remain Chairman of that, but the board is now called the GM Executive Committee. The new Committee is in charge of overseeing everything related to products and marketing. Lutz will be tackling marketing decisions, product decisions, and anything related to customers.

Will GM pay back the government?

Yes. The baseline plan calls for the government to be repaid by 2015, but CEO Fritz Henderson says that it will happen sooner. A lot of the repayment is going to depend on when the government elects to sale their shares of the new GM.

Is new GM profitable?

The company expects to be profitable by mid 2010 or sooner.

What about warranties?

New GM took on the liabilities of all vehicle warranties of vehicles sold prior and during the bankruptcy, even on brands that are no longer part of GM. Pontiac vehicles will continue to be covered by GM warranty through any GM dealership.

Any product changes?

Of course! With Lutz having even more say in things, we fully expect some product shakeups. Stay tuned to GMInsidenews for the latest on future product information.

[prototype66]

Sounds like the ducks are in a row.

[FenwickHockey65]

Sounds good to me. With Lutz still at GM, we should continue to see some pretty great products in the near future.

[Hurricane]

Great post - thanks for sharing this!

[artrix]

That was useful, thanks!

[plane]

But doesn't this mean that the government will actually be running General Motors?
And after all, everything the government touches screws up.
For example, stop lights, the Hoover dam and public libraries.

Honestly, I sit poised on the edge of my seat just waiting for the next itinerant poster to scribe those very same words.

[Hitman1970]

Forward and Upward only please from now on at General Motors Company.

[marinerbc]

Originally Posted by plane

But doesn't this mean that the government will actually be running General Motors?
And after all, everything the government touches screws up.
For example, stop lights, the Hoover dam and public libraries.

Honestly, I sit poised on the edge of my seat just waiting for the next itinerant poster to scribe those very same words.

Even I...am cautiously optimistic.

Excuse me, gotta check and see if the sky is falling yet. Be right back.

[TAMark]

Originally Posted by nsap

[size="5"] Total liabilities at the new GM are now at $48.4 Billion total, which is down from $176.4 Billion on May 31st at old GM. Liabilities include accounts payable, pensions, warranties and more.
[b]
.

Can you give some detail on who lost what in wiping out over 100 billion of liabilities? White collar pensions reduced? Everyone on here is celebrating this but no detail or concern on the poor folks that got screwed.

[ZR2BlaZeR2]

Originally Posted by plane

But doesn't this mean that the government will actually be running General Motors?
And after all, everything the government touches screws up.
For example, stop lights, the Hoover dam and public libraries.

Honestly, I sit poised on the edge of my seat just waiting for the next itinerant poster to scribe those very same words.

You forgot the National Parks system and the Louisiana Purchase.

I do worry that this sets a president that could be abused in the future. But if it means a CTS-V coupe.... I can live with it.

[Orbit]

Originally Posted by nsap

Is new GM profitable?

The company expects to be profitable by mid 2010 or sooner.

There will be no real "profit" until GM repays the hundreds of billions in loans paid to the company by federal government. Without the sufferance of US taxpayers, GM would not exist, so there should be no tooting of the horn about "profits" until its still-massive obligations to the public are settled.

[ZR2BlaZeR2]

Originally Posted by TAMark

Can you give some detail on who lost what in wiping out over 100 billion of liabilities? White collar pensions reduced? Everyone on here is celebrating this but no detail or concern on the poor folks that got screwed.

See, and everybody thought GM would have to change its logo to get people to forget.

I'm sure a lot of honest people got screwed, but I also think alot of other schmucks got a big dose of karma on this one.

[TORRED1]

Originally Posted by TAMark

Can you give some detail on who lost what in wiping out over 100 billion of liabilities? White collar pensions reduced? Everyone on here is celebrating this but no detail or concern on the poor folks that got screwed.

Yes almost 130 billion into thin air, who is paying for it, where did it go, some specifics please.

[PocoToro]

Originally Posted by prototype66

Sounds like the ducks are in a row.

Have you tried to herd ducks......you can get them into a row.......but it's harder to keep them that way..........now with the government the majority share holder GOOD LUCK

[TORRED1]

Originally Posted by PocoToro

Have you tried to herd ducks......you can get them into a row.......but it's harder to keep them that way..........now with the government the majority share holder GOOD LUCK

For everyone that is worried about the govt owning GM, I really dont see this as a issue and is the one thing I believe that Obama says ( I did not vote for him), when he says that he does not want to be in the car business. His sole goal was to save the union which he did, and to dump as much debit as possible, also done. The govt will sell it and get their money back. The only hand the govt will have in it is the govt cafe mandates which was comming regardless, due to California and their carzy desires. The govt just set a tougher national standard. That is seperate from the saving of the union and GM as a company.