The New GM - The Official Press Releases

[ciciusss]

Originally Posted by PeteM143

So Jim, what's your answer, eh? Marketing.... Please give it a rest.

I know you sell GM cars and you're good at it. My uncle was a dealer in Kutztown, PA, so I know why you are so passionate about this company. I have to give you credit for that. However, as a businessman you have to recognize that GM's management isn't like what it was 20 years ago when I worked for the company.

This company IS focused on product. You have said yourself that the product is spectacular. GM needed to shed the debt load it acquired by trying to keep promises it could no longer keep. The government, to it's credit, made sure all the sacred cows were slaughtered and d*mn it, it's about time!

The microscope is on these guys. There is going to be an independent, world class BOD, not the rubber stamp that it's been for decades. These guys aren't dumb and they know how to build cars profitably. No one could build slim margin small cars and make a profit with the legacy costs and debt load this company had. Although your experience as a dealer is useful, you have no idea what it takes to run a manufacturing company. The guys running GM do know how to build cars. They are good at it, and there is substantial proof for everyone to see.

I appreciate your passion, but if you would, give Fritz and the new BOD the opportunity to make this work. I like what I see from them at this point.

If you think GM can sell differently, fine, give your opinion. You have the experience and credibility in this area, but leave the management of the design and manufacturing to the people who know what they're talking about.

Pete,

Good Post. By all indications it seems that Fritz is getting good marks since taking over for Rick Wagoner. The managment over the past decade had a very difficult task of trying to shed legacy costs, excess dealers, etc. It may have been a task that was not possible without either trying to break the UAW or go into bankruptcy. Wagoner's biggest fault was that he did not want to do either for a variety of reasons.

They do deserve some credit, however. The product is much better and the manfacturing process has become much more efficient to the point where it is on par with Toyota.

[Chris322]

I think that going forward, the New GM needs to invest more into manufacturing facilities in the South. Alabama, Georgia, Florida, Mississippi, and Tennessee would be glad to get the jobs that have been limited to the North for so long.

[JoeliusZ28]

Originally Posted by zlohban

If "Bad Management" brought forth the Malibu, Traverse, Enclave, new SRX and Equinox, keep the bad management working

you are confusing engineers with managers

If GM really wanted to improve their product perception and public image - they'd be buying up dealerships and selling / servicing their products directly. Customers have more confidence in the product that way, look at the success of apple and their apple stores.

[DuSpinnst]

Originally Posted by Z28x

So what is the official name of new GM going to be? Chevrolet Motor Company I hope.

General Motors LLC or something like that.

[DuSpinnst]

Originally Posted by ciciusss

Pete,

Good Post. By all indications it seems that Fritz is getting good marks since taking over for Rick Wagoner. The managment over the past decade had a very difficult task of trying to shed legacy costs, excess dealers, etc. It may have been a task that was not possible without either trying to break the UAW or go into bankruptcy. Wagoner's biggest fault was that he did not want to do either for a variety of reasons.

They do deserve some credit, however. The product is much better and the manfacturing process has become much more efficient to the point where it is on par with Toyota.

Bankruptcy finally will eliminate entire swaths of management levels. That has always been GM's problem. Not that management was stupid, but rather that there where so many silos and departments that the company was ruled by committee. Bob Lutz tried to fight that (hence the committee of one quote), but GM had it so entrenched that the bankruptcy was the only way to wipe it clean.

[DuSpinnst]

Originally Posted by JoeliusZ28

If GM really wanted to improve their product perception and public image - they'd be buying up dealerships and selling / servicing their products directly. Customers have more confidence in the product that way, look at the success of apple and their apple stores.

Due to the nature of the business, unless all stores are GM owned price fixing is very likely which would draw the attention of the legal system.

Since in the car industry MSRP is meaningless (unlike in electronics where things actually sell at MSRP).

[jamiepeterson2]

$9 billion of perpetual preferred stock with a 9 percent annual dividend, payable quarterly in cash, $2.1 billion of which will be issued to the U.S. Treasury, $0.4 billion of which will be issued to the Canadian and Ontario governments and $6.5 billion of which will be issued to the New VEBA

FAIL!

Did GM fire all their number crunchers?

Last month GM sold 173,007 vehicles...
Now deduct 10,838 Pontiacs (soon to be eliminated from the portfolio)
7,367 Saturns (ditto)
913 Hummers (ditto)
892 Saabs (ditto)

That leaves GM sales at about 153,000 vehicles per month x 12 months = 1.8 million vehicles annually.
At an average of about $20,000 per vehicle that would bring in revenue of about $36 billion.
If 5% of that is the actual profit, GM would net about $1.8 billion.

Now, the $9 billion of perpetual preferred stock with a 9 percent annual dividend paid quarterly works out to be about $1 billion interest annually.

That only leaves about $800 million annually for GM to pay for all its other obligations listed in the new agreements, plus for R&D of new and/or updated products. $800 million won't even pay for one new platform!

What are the chances of GM ever paying off their 'loan' to the American taxpayer?
NIL!
What are the chances of the federal government ever relinquishing control through an IPO?
NIL!
What are the chances this is a sustainable plan?
NIL!

"Just the facts, Mam...just the facts."

[jamiepeterson2]

Originally Posted by ColinOpseth

Any word on Delphi? Or is New GM a separate entity?

GM repurchased 5 Delphi plants and they are now a wholly owned subsidiary of GM. Most of Delphi's global business operations will be sold to a private-equity firm, Parnassus Holdings II LLC, an affiliate of Platinum Equity.

[jamiepeterson2]

Originally Posted by SNO

So is "The New GM" going to be the official company name?

Since the Obamanator has already indicated that Chrysler LLC will be renamed The Chrysler Group, I rather suspect that the New GM will be renamed The GM Group. The Feds like to keep things simple in these complex negotiations, and by following the same essential plan that Chrysler did, GM could emerge from bankruptcy in 60 days or so.

[DuSpinnst]

Originally Posted by jamiepeterson2

Since the Obamanator has already indicated that Chrysler LLC will be renamed The Chrysler Group, I rather suspect that the New GM will be renamed The GM Group. The Feds like to keep things simple in these complex negotiations, and by following the same essential plan that Chrysler did, GM could emerge from bankruptcy in 60 days or so.

Chrysler LLC became Chrysler Group LLC because obviously Chrysler LLC was already in use.

GM will become something like General Motors LLC or GM LLC. Just as GMAC is now GMAC LLC.

There is no "The" in company names, unless you are goofy like "The SCO Group"

[PeteM143]

Originally Posted by jamiepeterson2

FAIL!

Did GM fire all their number crunchers?

Last month GM sold 173,007 vehicles...
Now deduct 10,838 Pontiacs (soon to be eliminated from the portfolio)
7,367 Saturns (ditto)
913 Hummers (ditto)
892 Saabs (ditto)

That leaves GM sales at about 153,000 vehicles per month x 12 months = 1.8 million vehicles annually.
At an average of about $20,000 per vehicle that would bring in revenue of about $36 billion.
If 5% of that is the actual profit, GM would net about $1.8 billion.

Now, the $9 billion of perpetual preferred stock with a 9 percent annual dividend paid quarterly works out to be about $1 billion interest annually.

That only leaves about $800 million annually for GM to pay for all its other obligations listed in the new agreements, plus for R&D of new and/or updated products. $800 million won't even pay for one new platform!

What are the chances of GM ever paying off their 'loan' to the American taxpayer?
NIL!
What are the chances of the federal government ever relinquishing control through an IPO?
NIL!
What are the chances this is a sustainable plan?
NIL!

"Just the facts, Mam...just the facts."

90% of Pontiac's volume was fleet, easily replaced with Chevrolets. 1000 cars a month is not much to worry about.

Saturn's customers will be temporarily lost. Once GM makes great cars every time at Chevrolet, they'll get a a percentage of them back. That's where Saturn cars and the dealer experience should have been from the start. Maybe then they'll take share from Honda and Toyota if the cars are that good.

Who cares about Saab's and Hummer's volume.. I dont and neither does anyone else.

GM will be sourcing vehicles for Saturn and Hummer, which means they make the money and take none of the risk.

I disagree with you that the taxpayer won't get it's money back. Read my previous post. Legacy costs and too much headcount are the only reason they haven't been profitable.

There is very little evidence that the current volume of car sales in the US will continue at 10MM units. The replacement run-off in this country is 12MM. There isn't a car company on the planet that can make money and fund research in this country at a 10MM run rate. The problem isn't that GM can't sell more cars, they are having difficulty getting people financed. As credit markets rationalize and unfreeze that will get better. 14MM is more likely in a normalized situation, which makes GM UBER profitable

Your assumptions are just plain wrong. The Treasury, ATF and the current GM management know what they are doing. They have the product down, they know how to produce it profitably (less legacy) and now they have right sized the company and set it up for success.

[goblue]

Originally Posted by 04bonnie

"Obama government is doing the best it can"... Whatever, if Bush was still in office everyone would be blaming him, and saying it's all the government's fault, but now our "do no wrong" Obama is in there, and everyone is saying...."it's OK, they are doing the best they can", blah, blah, blah. Whether it's the fault of Obama, or was sealed already before this, why are we so easy to jump to Obama's defense? New GM, or not....I won't give ANY credit to Obama for any good coming out of this. It's not General Motors, it's "Government Motors", and it's just the start of a lot of other changes the country will go thru under his leadership.

If Bush or McCain were in office GM would have gone Chapter 7. Total liquidation.

I think Obama's adminstration has handled this well. They found a middle ground. GM goes through bankrupcy, but comes out the other side. Pensions stay intact so the PBGC doesn't go insolvent.

If you don't think they are being hard enough on GM - look at the carnage. Thousands of dealers, tens of thousands of jobs lost, big paycuts for labor, jobs bank dead, union has lost much of their power. Don't get me wrong, I support all this - but lets not forget the significance.

I'd say its a reasonable compromise between Chapter 7 and making GM a ward of the state and continuing as normal.

[04bonnie]

Originally Posted by goblue

If Bush or McCain were in office GM would have gone Chapter 7. Total liquidation.

I think Obama's adminstration has handled this well. They found a middle ground. GM goes through bankrupcy, but comes out the other side. Pensions stay intact so the PBGC doesn't go insolvent.

If you don't think they are being hard enough on GM - look at the carnage. Thousands of dealers, tens of thousands of jobs lost, big paycuts for labor, jobs bank dead, union has lost much of their power. Don't get me wrong, I support all this - but lets not forget the significance.

I'd say its a reasonable compromise between Chapter 7 and making GM a ward of the state and continuing as normal.

I agree with your statement, for the most part "GoBlue". (except I'm a MSU fan! ). However, I just don't like all the patting on the back of Obama....Bush NEVER got that, so I'm getting tired of the praise he's been getting. That's all I'm saying. Is he handling the GM situation the best he can, most likely...what other choice was there? And true, he hasn't been in very long...but neither had Bush when 9/11 happened....and people seem to forget how well he handled all of that. I guess I'm trying to point out that folks should wait and see what Obama does during the whole term. I'm afraid of where things are going, and the changes in this country. Does the word socializm come to mind? But I don't want to swing this thread into a political discussion...just trying to make a point, and move on. Sorry to get people in an uproar, but I listened to it for 8 years when my president was in, so.....equal time I think is fair.

[HAMIAM]

My guess is if there is a new name it will be some sort of acronym just like everything else.

[solman98]

Originally Posted by Mpressmi

New Gm ? based on customers how bout bring back PONTIAC.

You know I keep hearing that. But the number just don't jive with it..... If they want it, then why don't they buy it? The "excitement" died long ago.

Originally Posted by suburbanfoo

New GM. Same crappy old FWD impala.

Before the G8 came here, just about everyone was saying, bring it here and they will sell like hotcakes. Well, they are not. The current Impala sells well and I doubt they are going to drop something that actually sells for something they probably won't. You want 4dr RWD, buy a G8. Want 2dr, buy a Camaro.