GM just hit 1.70$ a share.
GM Declares Bankruptcy Imminent After $4.2 Billion Third Quarter Loss
- Thread starter Timpo
- Start date
Thank you finally someone in this thread ( besides TC ) who realized that the problem is upper management!
Workers don't decide what cars to make management does! Management at GM has been pushing crappy stuff through for years all the while losing market share and getting raises. They pay bonuses to execs to keep them from leaving the company but these execs don't buy the product! These same execs that they don't want to leave have been giving the company crappy results for years.
My next door neighbor is a lawyer for GM and she's driving a damn Yukon XL 20 miles to work each way everyday on their dime.
People who build the cars have to buy their car from the company albeit even with a discount they're still putting , money back into the company. Why has big 3 market share been decreasing because the more people they lay off the less people buy their cars and not just the factory worker but everyone in the factory workers family and extended family who was getting their discount. The CEO though takes no loss as a matter of fact his salary goes up for losing market share .. just insanity!
I know you guys have heard about the CEO using the corporate jets but just wait till the end and hear GMs corporate defense as to why they "had" to use the G4
http://www.breitbart.tv/?p=224543&comments=1
Thanks for the positive feedback however I would not say that upper management is the only problem. I place the problem collectively on the shoulders of upper management and the union. I'd like to point out that I view the workers separately from the union - most of the workers are pawns caught between the union and upper management.
Top management has made tons of stupid decisions and run the company into the ground. The unions did their share as well. The UAW went on strike 3 times in the past 3 years, all while GM was bleeding money. Earlier this year they struck at the plant making one of GM's best selling product lines - the Acadia/Outlook/Enclave crossover - purposely to inflict the maximum damage.
I think a good 80% of UAW workers would trade away their contract for a situation like counterparts at Honda's American manufacturing plants. Sure, the pay may be somewhat lower but the job is certainly 10x more stable and AH has been paying year-end bonuses which the Big 3 have long stopped doing. I think there is a reason why the UAW has not been able to unionize a single transplant factory in the US - the workers don't want it.
Even today, while the auto execs keep flying their private jets the union has 6,000 workers on the GM Job Banks program - people who are getting paid 98% of their pay but aren't assigned to any job or plant.
The execs and Gettlefinger all don't get it, IMO.
Sorry what I meant was someone who understood that the UAW was not the sole reason for them going down.
As far a job banks go I don't agree with them but hey the execs get millions if they get fired.. I mean move to a different company:wink:
How come no one beefs about execs leaving and getting 10 mil plus for making decisions that run a company a ground
That's way more damage than an assembly line worker could do.I'm not sure that Big-3 management knows (or wants to believe) that their products aren't as good. During the hearing, they kept saying that they had closed the quality gap and cited JD Power initial quality survey numbers.
I believe the JD Power numbers are right - many/most domestic cars don't more initial problems than their foreign counterparts but that is not the only measure of quality. Long-term reliability (measured by JDP and others) is significantly below the competition, as is design quality. Yes, the dash trim no longer falls off (I actually had that happen to me with a new GM car) but the dash layout, design and general ergonomics still isn't as good.
Detroit doesn't understand that. Last year, GM purchased an Accord and Camry for every Saturn dealer so customers could do back-to-back comparisons right on the spot. I have to give them credit for a ballsy move, but that promotion didn't work and it lasted only about 1 month.
Sorry what I meant was someone who understood that the UAW was not the sole reason for them going down.
As far a job banks go I don't agree with them but hey the execs get millions if they get fired.. I mean move to a different company:wink:
How come no one beefs about execs leaving and getting 10 mil plus for making decisions that run a company a ground
I agree totally with you regarding exec compensation. Back in 1980, Lee I. at Chrysler cut his salary to $1, which gave him huge political capital to ask for a gov't loan. But the execs aren't willing to cut their pay or give up their jets, and Gettlefinger has said that he wouldn't give up union pay, so it seems that a bankruptcy court will have it sort it all out.
Can I ask why you would want to see any or all of the Detriot 3 go out of business? If you don't like their products, fine, don't buy them. But why would you want those companies - and the millions of people that rely on them - to go down?
Correct long term is not good and that's why JD and CR differ when it comes to a lot of automotive picks.
LOL Yeah yet another brilliant management move that had people leaving their lots and buying Accords and Camrys. Bet the guy who thought of that not only still has his job but has gotten several raises since then. You know gotta keep the talent:wink:
Actually I believe it was Wagoner who yesterday said he'd be willing to take a $1 for the bailout. My problem with that is if he was making/allowing bad calls on 16+ million a year what kind of calls is he going to make for a buck?? Seriously I mean he'd make more money ( golden parachute ) if they put him out and his excuse was that was basically doing charity work for a company in a bad economy hence the reason of failure. Then get another multi million dollar job running another company down. That kinda madness has to stop. The little guy is always dumb and lazy but they're never the ones making decisions that cause these huge downfalls.
All I ask of you guys is to consider this and be fair. Compare what big 3 execs make in comparison to what the Honda and Toyota execs make when comparing labor costs among union and non union. Compare benefits/perks for big 3 execs vs Toyota and Honda execs when talking about what UAW members get vs the non union members.
I abhor what unions have become but they didn't start out this way. They started because workers were being treated like crap by people on top.
I didn't listen to all of the hearings so if Wagoner did offer to cut his pay to $1, good for him. He and his fellow execs need to show much more leadership if they want the gov't and people to back them.
I agree that over-pay is a problem for the Detroit-3 at the executive level and worker level. I can also imagine a bloated mid-management level.
I agree that unions have lost their way. Today they exist only to perpetuate their existance. My father immigrated to the US from Europe in the 60's. He was a trained machinist and in Italy, the labor union was more of a trade union - advancing from an apprentice to a journeyman to a craftsman to a master machinist. The union also set levels for quality, pricing, etc. Today, a union like the UAW is all about collective bargining - quality, skill advancement, best practices, etc. mean nothing. My father hated the UAW because they focused on the assembly workers (of which there are 10's of thousands) at the expense of the trade workers (machinists, tool-and-die, electricians, welders, etc.). Line workers often made more than tradesman.
so what happens if one were to buy some gm, and they filed for chapter 11?
does the stock have to go to zero before they file? god id dump 50k into gm if i could get the shares for 10 cents a pop :tongue:
Unless you pay them in weed. :biggrin:
Actually, the pilots are the cheapest part of owning a private jet. You guys have NO IDEA how much a GIV or Falcon cost to operate a year. Not to mention the $50mil to buy it.
Last edited:
Is it monday yet?
In a bankruptcy, Chapter 11 specifically, the court freezes all creditors (with the usual exception of allowing workers to get paid) and has the authority to unilaterally sever contracts and dischange debt (ie, tell the banks and companies who are owed money "TS - you're not getting paid, or not getting paid everything you are owed.") Usually, the stock price recovers after the company exits Chapter 11 much leaner and profitable. Many of the airlines went thru this process and their stocks recovered (and then crashed again due to the fuel cost crisis earlier this year).
The problem is that if the company can't exit Chapter 11, then the judge can decide to put the company into Chapter 7 and the company is closed down and everything that is sellable is sold. The money is used to pay employees, secured debt (bank loans), trade debt (what's owed to suppliers), bond holders and finally shareholders. In that order. A Chapter 7 of GM or Ford would result in no money for the shareholders - they both have over $100b of obligations to employees, banks and suppliers. GM and F bond holders would not see any recovery in a Chapter 7.
For GM to go into Chapter 11 would be risky - the fear is that customers would totally dry up and push the company deeper into the red. If GM declares Chapter 11, the shares will go below $1 but not necessarily $0. It would be a pure gamble on whether they will make it out of Chapter 11 or not. If the court discharges GM's $170b of debt and recasts the union contract, GM would be a very lean competitor with a cost advantage over just about everyone. In that case, the stock could go back to where it was 2 years ago, in the $40's. Or you could lose your entire $50k.
My bad TC apparently Wagoner said he'd take a 50% pay cut to 8 million
but is unwilling to take a $1 salary like Iaccoca. I'm sure most of you think that his decision is the UAW's fault. Oh and about those job bankshttp://www.freep.com/article/20081120/BUSINESS01/311200023
Ski_Banker
Suspended
WRT Ch. 11 Bankruptcy -- almost always the existing stock is worth exactly zero once the company emerges months later (years in the case of the big automakers). New stock is issued to the creditors of a certain class. Given the all of the costs involved in a comprehensive restructuring of GM, for example, I would expect only senior debtholders to get any new common stock.
DO NOT buy the existing GM or F common stock, at any price. You're doing nothing more than gambling.
DO NOT buy the existing GM or F common stock, at any price. You're doing nothing more than gambling.
Here's some pay info on those UAW bastards
http://www.autoblog.com/2008/11/23/opinion-the-real-cost-of-unionized-auto-workers-70-hour-try/
http://www.autoblog.com/2008/11/23/opinion-the-real-cost-of-unionized-auto-workers-70-hour-try/
They asked for $25billion from the taxpayers last week. This $25 billion would not warranty them to survive either. If the business is not better next year, they can either ask for more from the Congress or declare bankrupt. This money is only the bandaid and it is going to fix the problems.
This $25 billion is a risky business.
http://money.cnn.com/news/newsfeeds/articles/apwire/50e5e78d1a682b13165a8d1e5c8c8ea2.htm
This $25 billion is a risky business.
http://money.cnn.com/news/newsfeeds/articles/apwire/50e5e78d1a682b13165a8d1e5c8c8ea2.htm
Last edited:
It's not congress's money, what do they care.
<object type="application/x-shockwave-flash" data="http://widgets.nbc.com/o/4727a250e66f9723/4929c4ce2dc3b4af/4741e3c5156499a7/f6d5925b/-cpid/ae7622047191d845" id="W4727a250e66f97234929c4ce2dc3b4af" width="384" height="283"><param name="movie" value="http://widgets.nbc.com/o/4727a250e66f9723/4929c4ce2dc3b4af/4741e3c5156499a7/f6d5925b/-cpid/ae7622047191d845" /><param name="wmode" value="transparent" /><param name="allowNetworking" value="all" /><param name="allowScriptAccess" value="always" /></object>
The big thee made there bed a long time ago, spent and partied like there was no tomorrow and the UAW just got a fair share those big profits for its members. Well tomorrow is here and they have knowingly ran themselves into corner and they refuse to do what they need to survive. After giving up market share for 30 years to companies that were willing to build well made cars at a reasonable profit and not ok vehicles at a huge profit.
GM has beat it suppliers to a pulp for the last 10 years, the stories I have heard makes Walmart sound like Mother Teresa.
My favorite part of this whole thing is it is being blamed on the credit markets; people can't buy cars because they can't get loans. 25% of the car owners are in 5+ year loans and are upside down. Is it any surprise the whole house of cards fell down? 20 years ago people were predicting problems as car loans kept getting longer and then in the last few years even the down payment went away. The car makers and dealers have been selling cars that should have never been sold. Just moving inventory off the lot and taking their commissions not unlike the mortgage brokers.
GM has beat it suppliers to a pulp for the last 10 years, the stories I have heard makes Walmart sound like Mother Teresa.
My favorite part of this whole thing is it is being blamed on the credit markets; people can't buy cars because they can't get loans. 25% of the car owners are in 5+ year loans and are upside down. Is it any surprise the whole house of cards fell down? 20 years ago people were predicting problems as car loans kept getting longer and then in the last few years even the down payment went away. The car makers and dealers have been selling cars that should have never been sold. Just moving inventory off the lot and taking their commissions not unlike the mortgage brokers.
Last edited:
so true Brian. in our current consumerist society all manor of "dept" far outweighs the borrowers ability to pay it off.Cars have to be added to the "credit" crisis just as mortgages have.So much of our population has been hypnotized into thinking they can afford all manner of big ticket items.Sell Sell at any cost is the paradigm. Look at all the store chains offering 0% interrest ,don't pay for the first year...and people don't save the money to actualy pay off the dept accrued in that grace year They continue to buy and borrow way beyond thier means.
They continue to buy and borrow way beyond thier means.
Real wages haven't increased in 5 years. Shouldn't be a big shocker our stock market hasn't either. It's time to pay the piper and there is no getting out of it this time. Now even the government is broke.
- Joined
- 1 September 2001
- Messages
- 4,123
May 07, 2008
GM Comp Committee Rewards Wagoner
General Motors Chief Executive Rick Wagoner's salary and other compensation rose 64 percent in 2007 to about $15.7 million, mainly due to option grants, according to a recently filed proxy.
In its CD&A, the GM compensation committee cited significant progress over the past few years in reducing the automaker's healthcare costs, increasing growth internationally, and improvements in sales of its cars and trucks as part of the rationale for the pay packages awarded to top executives.
http://www.directorship.com/gm-ceo-comp
GM Comp Committee Rewards Wagoner
General Motors Chief Executive Rick Wagoner's salary and other compensation rose 64 percent in 2007 to about $15.7 million, mainly due to option grants, according to a recently filed proxy.
In its CD&A, the GM compensation committee cited significant progress over the past few years in reducing the automaker's healthcare costs, increasing growth internationally, and improvements in sales of its cars and trucks as part of the rationale for the pay packages awarded to top executives.
http://www.directorship.com/gm-ceo-comp
Similar threads
