The unthinkable: A General Motors bankruptcy

mcall ^ | April 30, 2006 | Tom Petruno and John O'Dell

[RoadTest]

All this blame of the UAW is justified, but it's also justified that management was co-dependent and complicit in all this destruction, because after they gave the union the bank, times changed and smart competitors came over the horizon and put down roots here.

GM management has been notoriously stupid in the past, as H. Ross Perot said as he chuckled back to Texas from GM with $800,000,000 from them in his pocket, given to him by GM, just to get rid of him. (He'd been telling them what they were doing wrong and they have never liked that)

And executives retiring with million$ is very much akin to paying UAW workers not to work.

[lemura]

I'm one of the analysts that think GM is finished

You and every other person that can think logically enough to solve 1+1=2.

A GM BK would be a tremendous boon to the company. Ridding itself of both current management & union contracts will enable GM to finally develop products that can compete with Asia makes.

[Principled]

Take any of the rest of their line on the Autobahn and you'll understand why they can't export them.

Yes. And I think they don't make them for export anyway - because GM builds a car too expensive to sell overseas against lower labor costs and higher tax costs....they haven't even tried to make an exportable car.

[GodfearingTexan]

its not just the unions. our trade laws make it so they have to compete against the same wages as the asian car companies. why is the president or the congress not doing something about the complete loss of our nation's manufacturing sector? i am honestly worried; and i am very, very upset that they as these jobs are lost nothing is being said by the people who promised prosperity with these trade laws.

[LaMudBug]

"About 10 years ago--a company I was the Ex. Director for purchased over $1,200,000 of new cars from G.M. When we went to look at some sample cars at a nearby new car lot--the sales person walked away as soon as we told him we had purchased the cars elsewhere. He wouldn't answer one question--it wasn't his company's sale."

You were naive and unrealistic in expecting a sales person who works on straight commissions to spend time with you. Auto sales people work on an "Up" basis meaning that when someone comes onto the sales lot, the sales people take turns with these "walk-ons" and are held accountable for results with these "walk-ons". The question shouted out inside the dealership is, "Who's UP" and that is were the "Up" comes from.

The dealership is spending thousands of dollars in advertising to get people to come to their lot so that the sales person will have an opportunity to sell that dealer's car and they want results. That is the way it is done in what has been a free enterprise, capitalistic, very competitive industry for a zillion years.

Live with it and next time go to the dealer you bought the cars from. GM is not going down because a commission salesperson did not want to waste his 'UP" on someone who had already bought from another dealership. Get real...

[Brilliant]

The union is to blame.

[IllumiNaughtyByNature]

What is sad is the every business school in the country talks about how bad the unions are/were hurting the auto industry and nothing changed. I remember my under-grad business teachers talking about the union leeching and then heard the same things all over again in my MBA business classes. I thought to myself, this is the same crap at a higher price per unit? And on top of that there is no one trying to bust up the unions.

[wolficatZ]

"This really is sad."

The "sad" people of Free Republic and their "This is sad/So sad" posts.

Every single thread has a "sad" post nowadays.

No solutions, information, discussion or debate.

Just "This is sad".

[Uncle Vlad]

General Motors is in trouble for the same reasons France, Germany, and other socialist countries are in trouble--you just can't keep paying for everything and expect to make a profit.

[Mr Rogers]

GM's 147,000 workers in the United States and 460,000 retirees...

That says it all.

And Social Security is headed that route...

[eddie2]

Perfectly stated, GM seems to be run like a Government bureaucracy. The just can't force people to buy their product.

[MineralMan]

Sad business, but inevitable. For me, it all began with the peeling paint in the 1980s. GM didn't do what they should have and repaint these cars. Still, I have owned some GM cars since then.

Right now I have a 1999 GMC Jimmy, with about 100K miles on it. At 95K miles a wheel bearing went out. Since you can no longer just buy new bearings, you have to buy an entire hub ($400). At 97k miles, the other front wheel bearing went out ($400). At 99K miles a ball joint failed while my wife was driving, almost causing an accident. I had all of them replaced ($700). I did ask the dealer service department why they had not checked the ball joints when they replaced the hub assemblies. The service manager just shrugged.

I went and did some research, and these ball joints and hubs regularly fail at about that mileage. It's sort of a standard thing for the vehicles. Odd that the GMC dealer didn't even look at them.

If GM goes under, I will shed no tears.

[sit-rep]

Whenever I see somebody tooling along in a Ford pickup or a GM car, I always say to myself "There goes another John Kerry supporter."

LMAO...

Daaaayuuummmm!

[IVote2]

Robert Farago has been trying to point out the mistakes of Ford and GM for quite awhile. He has a feature he calls General Motors Death Watch for GM.

http://www.thetruthaboutcars.com/content/1146097124154135570/

I highly recommend his comments and what he believes would help.

For those who blithely say let them go down, there will be huge, perhaps catastrophic consequences so I'm not one to say, who cares. We all WILL care. Unemployment, bankruptcy perhaps for Michigan, and car dealers all over the country. This is a big deal in my opinion.

Jen

[jpsb]

Nice of you to send your money to Japan, personally I preffer to keep the money here which is why I drive/buy American. GM, Ford and my cars/trucks run great. I like the idea of buying American made instead of American assembled.

[x_plus_one]

If GM does it right they can go into bankruptcy, get rid of all union contracts and emerge the stronger car company. Airlines did it - so can GM.

[alice_in_bubbaland]

We switched from Buick products to Honda products twenty years ago and never looked back. Currently there are three Honda's in our driveway, plus a Honda lawn mower & power washer in the garage. If GM built a car that ran for 200,000 miles with little or no problems, then I might consider coming back.

[IVote2]

Whenever I see somebody tooling along in a Ford pickup or a GM car, I always say to myself "There goes another John Kerry supporter."

REALLY! Well say this to yourself, you are wrong! We have a 2001 Tahoe which we bought used. We feel safe in it which is one reason we bought it. MPG it isn't any worse than some of the so called "better" cars which is why we still have it. On the road it can get 18 or 19 MPG. I could go on but why bother.

BTW, We didn't vote for Kerry.

Jen