[jzchev28]

General Motors said Tuesday it is “aggressively pursuing austerity measures” and intends to draw down $16 billion from its revolving credit facilities.

The company called it a “proactive measure” to preserve financial flexibility. GM expects to have $15 billion to $16 billion in cash at the end of this month.

In the wake of the announcement, GM shares were up more than 9% in early trading. The stock, which has a market value of $26.3 billion, had fallen 50% in 2020.

“We are aggressively pursuing austerity measures to preserve cash and are taking necessary steps in this changing and uncertain environment to manage our liquidity, ensure the ongoing viability of our operations and protect our customers and stakeholders,” CEO Mary Barra said in a statement.

Continued at link: https://www.cnbc.com/2020/03/24/general-motors-will-draw-down-16-billion-in-credit-suspends-2020-outlook.html

 

[eaton53]

Sounds like they learned from the last time. Cash is king when things go south in a big way.

 

[Neanderthal]

Sounds like they learned from the last time. Cash is king when things go south in a big way.

Going south? So can we expect Mary to start saying y'all and ya-heah and stuff like that?

 

[gkr778]

Going south? So can we expect Mary to start saying y'all and ya-heah and stuff like that?

As long as Mary doesn't keep touting "zero, zero, zero" while sayin y'all and yeehaw, it's all good.

 

[emh]

Ford/Mulally were the only ones who seemed to appreciate having cash on hand going into the last recession. Happy to see the lesson was not lost on GM (and even happier to see "zero cash" is not one of Mary's goals!).

 

[jpd80]

Speaking of very little cash at hand, I wonder how Tesla will fare in these times......

 

[gkr778]

Speaking of very little cash at hand, I wonder how Tesla will fare in these times......

Just like history's other pyramid schemes...

 

[Mr.Buttons]

Going south? So can we expect Mary to start saying y'all and ya-heah and stuff like that?

As soon as she learns English again.

 

[emh]

Speaking of very little cash at hand, I wonder how Tesla will fare in these times......

Well, Tesla had $6.5B in cash at the end of Q4 last year and raised another $2B in February (although people questioned that additional capital raise at the time, it looks quite prudent now). For their size, I suspect they have a decent amount of cash on hand. We'll know more when the Q1 financials come out.

 

[BlackGTP]

I for one am very happy that Mary B. is at the helm in times like these. She has shown fiscal responsibility unseen in GM for decades, she has shown the gumption to drop money losers. She knows how to keep the company alive.

 

[gkr778]

I for one am very happy that Mary B. is at the helm in times like these. She has shown fiscal responsibility unseen in GM for decades, she has shown the gumption to drop money losers. She knows how to keep the company alive.

+1
And despite parroting the "zero, zero, zero" nonsense in recent years, Mary Barra wasted no time in making key strategic and operational changes impacting the financial health of General Motors. That's a refreshing change from the old GM, which often waited until a major crisis to do so.

No dilly-dally from Mary!

 

[[email protected]]

And the salaried staff take a 20% pay cut for the rest of the year! (But Mary is taking a cut too!)

 

[Ed753]

I for one am very happy that Mary B. is at the helm in times like these. She has shown fiscal responsibility unseen in GM for decades, she has shown the gumption to drop money losers. She knows how to keep the company alive.

Yup, she is smart; especially when she promoted a 39 year old, fixed-income (bonds) manager to CFO.............

Hopefully all the smart people on the team didn't get discouraged and quit when she was appointed, she'll need some "senior leadership".


Looking at GM's 2019 Q4 Earning Statement, it looks like they had about 23.5 Billion, but....................

Per Automotive News GM was projecting to have about 15 Billion at the end of Q1, and burning a ton the last few weeks, this 16 Billion gets them to about 30 million.

What is a "buffer" a company the size of GM needs to survive? 5 ~ 10 Billion?

During the strike last fall, GM was burning through about 0.5 Billion a week.

 

[Ed753]

Annual Dividend cost is a little over 2 Billion (assuming they don't cut or suspend).

Also stock buy-back plan has about 3.5 Billion remaining.

Precarious times....................

 

[mbukukanyau]

The key is the is the claim by mother that all the shutting down around the globe mean she can keep GM profitable at a SAR of 12 million , that is at an annual selling rate lower by 5 million from where it was before the crisis, If she can do that, GM should become the most valuable auto company, since I do not see even cheap Toyota eking out a living at that annual rate.

Yeah, how about Tesla.

As we speak, Nissan/ Renault are in real trouble now.

 

[emh]

Yup, she is smart; especially when she promoted a 39 year old, fixed-income (bonds) manager to CFO.............

Hopefully all the smart people on the team didn't get discouraged and quit when she was appointed, she'll need some "senior leadership".

Honest question: do we have any reason to believe the CFO isn't doing a good job? Just because she's not old and is a woman by itself doesn't mean she wasn't the right choice.

 

[Ed753]

The key is the is the claim by mother that all the shutting down around the globe mean she can keep GM profitable at a SAR of 12 million , that is at an annual selling rate lower by 5 million from where it was before the crisis, If she can do that, GM should become the most valuable auto company, since I do not see even cheap Toyota eking out a living at that annual rate.

Yeah, how about Tesla.

As we speak, Nissan/ Renault are in real trouble now.

Yet before, you repeatedly told us they were profitable at 10.5 SAAR before all the cuts?

Current SAAR is?................ Zero?

Honest question: do we have any reason to believe the CFO isn't doing a good job? Just because she's not old and is a woman by itself doesn't mean she wasn't the right choice.

You left out Indian?...............

I don't know how old you are, or what your expertise/profession is, but I'm 50 with ~25 years in my industry, it boils down to experience/knowledge, which isn't some that you can read in a book or just snap your fingers and have it. "You don't know what you don't know" is one way to put it, but it's more than that.

Today if push come to shove, I could run my business unit, with little negative impact; and I could have done it when I was 39 too, but not anywhere as good.



Try this:

If GM's CEO was a man, and he promoted some "kid" a 39 year-old guy from finance, with a majority of his experience in "fixed income investments" (bonds), to CFO, what would you say?
- I'd be saying the same thing..........................

 

[gkr778]

Honest question: do we have any reason to believe the CFO isn't doing a good job? Just because she's not old and is a woman by itself doesn't mean she wasn't the right choice.

We'll find out in a few months.

 

[richmond2000]

The key is the is the claim by mother that all the shutting down around the globe mean she can keep GM profitable at a SAR of 12 million , that is at an annual selling rate lower by 5 million from where it was before the crisis, If she can do that, GM should become the most valuable auto company, since I do not see even cheap Toyota eking out a living at that annual rate.

Yeah, how about Tesla.

As we speak, Nissan/ Renault are in real trouble now.

IMHO Toyota will have "less exposure" then GM due to being more global but I do BELIEVE GM's "books" are in better shape to FACE DOWN the same downturn than Toyota / VW
I think VW is in the worst shape being they are in the middle of a TOTAL transformation over to EV with NOTHING NEW TO SELL this year

 

[emh]

You left out Indian?...............

I don't know how old you are, or what your expertise/profession is, but I'm 50 with ~25 years in my industry, it boils down to experience/knowledge, which isn't some that you can read in a book or just snap your fingers and have it. "You don't know what you don't know" is one way to put it, but it's more than that.

Today if push come to shove, I could run my business unit, with little negative impact; and I could have done it when I was 39 too, but not anywhere as good.

I'm an engineer in my mid 40s, so not much younger than you. But I've been around long enough to know age isn't always a good determinant of capability. Yes, some experience is necessary. But, as with everything else, there's diminishing returns to experience too. Most people get the critical experience in 10 years or so (others need more time to get there but those aren't the ones you want to promote to the C suite). Beyond that, other criteria matter more. This is especially true in finance and engineering where the true stars rise very quickly.

(yeah, I left out Indian because being Indian in the C-suite isn't unusual anymore).

Try this:

If GM's CEO was a man, and he promoted some "kid" a 39 year-old guy from finance, with a majority of his experience in "fixed income investments" (bonds), to CFO, what would you say?
- I'd be saying the same thing..........................

I'd be saying the same thing I said too. I care about evidence of what people can do. I don't care about gender or age (aside from what I said about ~10 years experience) or ethnicity/origin. I simply don't know enough about this gal to pass judgement, and it doesn't sound like you do either. It's probably best to give her the benefit of doubt and see how she does.