In an interview on CNBC, Mr. Wagoner said G.M. and the industry were bouncing along the bottom, and he did not know when to expect an recovery.
Posted on 08/01/2008 5:08:42 AM PDT by Zakeet
The General Motors Corporation, reeling from the abrupt shift to small cars by consumers, posted a $15.5 billion second-quarter loss on Friday, in results weighed down by restructuring charges and write-downs.
According to the earnings statement, the loss included $9.1 billion in one-time charges, $3.3 billion of which was for employee buyouts.
[Snip]
Excluding one-time charges, G.M. had a loss of $6.3 billion or $11.21 a share, compared with income of $1.3 billion or $2.29 a share in the same period last year.
Included in the results, the statement said, was $1.3 billion in write-offs that reflect the drop in value of trucks and sport utility vehicles in GMAC Financial Services’ portfolio.
[Snip]
While its overseas operations continued to perform well, G.M.’s United States sales dropped. On Friday, in its earnings statement, G.M. said it had sold 2.29 million vehicles worldwide in the second quarter, down 5 percent from the period a year ago. North American sales were down 20 percent, or 236,000 units, while sales outside of North America grew by 10 percent or 116,000 units.
A record 65 percent of G.M.’s sales for the second quarter were outside the United States, the company said, while global market share was 12.3 percent, down 0.9 percent because of the weakness in North America.
[Snip]
And in a move that symbolized the end of the S.U.V. era, Mr. Wagoner said that G.M. had begun a “strategic review” toward a likely sale of its Hummer brand.
[Snip]
Analysts estimated that G.M. was burning through $1 billion in cash a month, and needed more liquidity to survive the sales downturn into 2009.
With G.M.’s stock dropping to $10 a share and analysts suggesting G.M. might file for bankruptcy protection, the company announced another round of cost cuts in mid-July.
(Excerpt) Read more at nytimes.com ...
In an interview on CNBC, Mr. Wagoner said G.M. and the industry were bouncing along the bottom, and he did not know when to expect an recovery.
So if Exxon bought GM, the combined company would have no profits for Democrats to demonize.
In other news, Nancy Pelosi is considering legislation which would force evil oil companies with record profits to buy struggling car manufacurers. If harry Reid wakes up, he may consider the same thing.
Alot of money...
The General Motors Corporation, who never learned the lessons of the 1970s (when fuel costs increase, sales of gas-guzzler vehicles plummet) and put most of their investment in the sales of large SUVs...
Current gas prices are not the main issue. GM has been making junk for 20 years, losing market share to Toyota, Honda, etc. It won’t be long before China makes and sells its own version of “GM Junk”, and that will finally put GM out of business.
To be frank, it sounds like you are HAPPY China is taking over American companies.
What’s your problem?
Trucks and cars that look like plastic Tonka toys doesn’t much appeal to me.
To be frank, you sound like a jingoist, eager to attack a perfectly fair observation because it isn’t as “pro-American” as you’d like.
Well, Exxon made a lot of money in aggregate because it sells a lot of oil, gas, etc (volume). However, it's net profit was only eight cents ($0.08) on the dollar - a very modest return when compared to corporations such as Coca Cola, Apple, Intel, HP, others.
I’ve been reading FR long enough to notice there’s a sizable number of posters who have so bought and drank the “free trade” kool-aid, who won’t be satisfied until there are simply no more jobs in America.
Simply to break unions.
Why? Because unions are too socialist. As an isolated concern, that’s a pretty valid one. But it’s the “solution” to that concern, which has evolved into sheer idiocy.
The solution: Send all those jobs to a communist giant, so they can create history’s largest military. Nuclear missile submarines. Carriers. Satellites. And the worldn’s most formidable industrial base.
(can you say “Rosie the Riveter” ... I knew you could)
With our money.
Brilliant. Just brilliant.
A billion here, a billion there. Eventually you’re talking real money.
yeah but then they would say that GM was on the “verge” of introducing a miracle fuel injection system (use to say carbs but everything is now fuel injected) that got 100 miles per gallon but “evil big oil” bought the company to keep it off the market.
Is is certainly not beyond the realm of possibility, that indeed the billions of oil dollars sloshing around US boardrooms, may have been a factor in why — all the US automakers continue to turn out large vehicles which cannot use any fuel other than gasoline...
While the rest of the world seizes on alternatives, such as flex-fuel.
This poster considers it very likely.
We need to change that.
Adopt an E-85 flex fuel vehicle today. :)
Sounds like most (2/3) of the money lost was in the book value of lease vehicles. They won’t get as much for second hand SUVs as they had anticipated.
I owned a new ‘86 Astro and it was good, reliable vehicle, nothing junk about it at all. I also owned a new ‘97 Ford Ranger, same thing.
Where Detroit is losing me as a customer has been in smaller commuter vehicles. They don’t have anything in their stable to compare to Corolla, Civic, Camry, Subaru, etc. imho.,
Did you know that Exxon paid $3 in tax for every $1 in profit last quarter? The Donks should be kissing their feet for financing the government.
Man, that Aztek is one butt-ugly vehicle. But everybody I know who has one loves the darn thing. It turns out that it is pretty good on gas, and has a nifty removable seat and optional plastic floor liner that makes it a good alternative to a minivan if you haul a lot of stuff around or live at the beach.
I predict that the people who have Pontiac Azteks are going to be driving their "ugly" cars for a long, long time.
Toyotas and later, Datsuns, began showing up in the 1970's, right? And the Big Three were bloodied then. They have had a GENERATION in which to figure it out. They responded with things like Gremlins, Pintos, Geos,etc., and later with Tauruses and Saturns, which were really not all that bad..But they just never seemed to get it.
The truck and SUV markets were accepted by the customers, so this led to a decade of denial and fantasy.
Everone knew that OPEC hated our guts, but never seemed to make the connection that the party was not going to last.
BTW, going shopping this morning, I see two more SUV's on front yards..added to the three previously placed trucks and an SUV which are still sitting there unsold.
I am seriously thinking of getting one, when they hit a nickel a pound, because now that I am retired I do not drive that much, so gas prices are not that important any more. When I was commuting 100 miles a day, it would have made it untenable. My neighbor has a commute like mine, actually to the very same town. He sold his big pickup a few weeks ago. Had to.
I think people will adapt. Where I live everyone has at least two vehicles. They are saving the trips in the big vehicles for situations where they have to use them, and are putting the mileage on the smaller one for the nuisance trips. People are taking one trip for several stops now.. And it does appear to be working. Oil prices are down again, and the financial pages are blaming lowering demand. It looks like they have finally found the elastic limit of demand.
Too late for the auto companies, though. They had their warnings long ago.
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