[Poohbah]

GM is a prime example, they are only thinkiong from quarter to quarter with their moronic 0% financing and ultra high rebates per car sold, things that will hurt GM in the longer run,

The question is, which will hurt GM more? Keeping large amounts of unsold inventory into the 2004 model year at 100% loss, or getting it moved aside at a lesser loss?

[JNB]

What hurts GM is the lack of profitability that the GM finance arm has brought in in the upcoming years, since GM like Ford and Chrysler have made more on the finance of cars and the actual car itself. Yes, short term it helps, but the fact that many of these cars will not produce profits for the duration of their loans is going to hurt GMs bottom line in the next few years, and also the 0% financeing, again while great in the short term to boost demand, has in effect, brought future demand forward.

So to restate the question, what is worse, taking a large loss in the near term so GM can be more solvent and profitable in the longer run, or trying to allways boost the next quarter, at the expense of future sales and profits?

The auto makers so far have done ok because home re-fis have enabled consumers to take out home equity loans to buy cars, but the end of the re-fi booms is going to iompact the auto makers in a very negative manner as well.