Posted on 05/08/2012 11:09:03 AM PDT by jazusamo
Last week's earnings report from General Motors revealed a troubling statistic for shareholders. GM's market share for North America shrunk from 18.3% a year ago to 16.7% for the latest quarter. Not coincidently, a survey by Yahoo Autos revealed that a full 13% of consumers would now "never" consider purchasing a GM vehicle while another 15% are less likely to purchase. A negative perception of the auto bailout process and the continued political overtones at GM are the reasons for the boycott.
Another recent Rasmussen poll showed that 59% of Americans view the auto bailouts as a failure. The Yahoo Autos' article puts a more positive spin on the auto bailouts stating that two thirds of Americans put GM on their shopping list. Unfortunately for GM, a loss of any segment of potential buyers causes the company to have to spend more in incentives to maintain market share.
Incentive spending for GM rose to 115% of industry average for the month of April. This is the highest number in a year. In addition, GM is relying on loosened credit standards to help spur sales as GM Financial sub-prime loans rose to 8.2% for the quarter, up from 6.1% a year ago. The industry average is currently 6%. Government-owned Ally Financial is pitching in as well, offering 72 month / 0% interest on struggling models like the Chevy Volt.
The extra help is needed as GM has taken an unusual position in vilifying conservative and Republican car shoppers by accusing them of running a "wrong-headed" misinformation campaign designed to hurt sales of the Chevy Volt. The argument holds no water as other plug-in cars, like the Nissan Leaf, are selling even more dismally than the Volt. GM CEO, Dan Akerson, claims that Republicans criticize the Volt but not the Leaf, thus hurting Volt sales. If the logic was sound, sales of the Volt would be suffering more than the Leaf. GM continues to spend a disproportionate amount of money promoting the Volt, which serves as a symbol of Obama's green energy initiatives, while losing market share in more profitable segments.
Many Americans recognize the blatant favoritism that political allies of Obama, like the UAW, have received in the GM bankruptcy process compared to other groups. GM bondholders and taxpayers fared worse than UAW members who not only kept their jobs and benefits, but are now receiving thousands of dollars each in bonuses. The auto bailouts seemed to have an underlying goal of protecting the powerful UAW. Perhaps nowhere else is the blatant inequity evidenced than in the treatment of Delphi retirees. UAW retirees had their retirement benefits protected while non-union retirees lost theirs. Congressional investigations are ongoing in the obviously biased redistribution of wealth that favored the UAW.
The automotive sector remains very competitive, companies can not afford to alienate potential buyers by taking political stances as GM has done with the Volt. The continued campaigning by President Obama on the "success" of GM and the Chevy Volt as Treasury refuses to exit taxpayers' stake in the company further alienates individuals who do not agree that the auto bailouts where overwhelmingly "successful." If the sacrifices of those classes that were not politically connected are not recognized, it is hard to let bygones be bygones. 13% of disenchanted Americans may not be enough to change an election, but it can sure put an auto manufacturer at a competitive disadvantage as the GM boycott continues. A strategy by Government Motors to vilify critics is not helping the situation.
Mark Modica is an NLPC Associate Fellow.
I won’t ever buy one of their pieces of crap...never have, never will...Chevy SUCKS.
You are completely right. I don’t care if they make the best car on the market, now. This is Government Motors backed up by the UAW Medical Pension Fund. These people can choke on their automobiles. They can eat them, because I will NEVER even think about buying a GM product in the future.
Buy a GM car, and a portion of the sales will go to the Democrat party.
I don’t do business with thieves. My current vehicle is a pre-bailout GM, but it won’t happen again - unless the thieves restore and make whole the bondholders and taxpayers who were defrauded.
I don’t believer in boycotts. However, I personally will never buy a GM produced car that was built during the time after the bailout. If GM makes good on every dollar and returns to private ownership I will add cars built after the day that happens. Anything built within that window, however, is off limits.
It’s a personal choice based on core, principle values.
Hubby and I just purchased a Ford 150 Platinum. We knew going in to our vehicle search that a GM product would never even be considered. EVER!
I wonder how many like-minded folks like us are really out there?
They already received too much of my dough via taxpayer bailout. I will never buy a GM product again. I hope their stock price drops out of sight and the UAW goons who benefitted from this corruption end up with worthless pieces of paper.
Thanks for linking, that’s an excellent video.
We’re in the market for a new truck and GM has NEVER been a consideration for us.
How do you like your Ford?
Never again GM. Ever. First the bailout, then the parts dept wanted $100 for a replacement key fob to replace the defective one that came with my pre-bailout chevy. GM can pi$$ up a rope.
I used to buy GM pretty much exclusively (back since the “Mark of Excellence” days that are no more), but I’m done with them. I am their worst nightmare: A once loyal customer permanently (more or less) turned away from them.
I am one of the 13%. I tell everyone I know, I will NEVER buy an Obama-motors. Maybe its working.
I used to be a faithful GM owner. Never again. The bailout was bad enough, but the silly environmentalism with the Chevy Volt is over-the-top corruption when you consider the level of cooperation that it takes with Obama to make it ‘work’, so to speak.
I will NEVER buy a GM product....the bailouts did them in for me.
I wonder how many like-minded folks like us are really out there?"
Probably more than you think!! Bailouts are NOT the American way.
BUT - that soon might change if Obama is re-ekected.
This past week, Ford UAW sent out snail mail letters to all employees & retirees saying that not taking the bailout was a BIG mistake & they want everyone to vote for Obama in this election so that they can get their share!!!
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