If GM fails, what then?

[warlordblee]

If the nightmare happens and GM fails, imagine the smack in the face of expeditors nationwide. I know some of the smart ones have gone other directions for freight. With the year ending look back at your loads and add up the ones that aren't related to GM, or Ford. Ford's stock is two dollars and GM's is three dollars, the nightmare is close.

 

[ATeam]

Would it be a nightmare or just reaping what they sewed? If GM fails, there will not be a shortage of cars. It will take some time but the economically viable components of the company will find new life somewhere else. The non-viable components will disappear. A major bailout will not change that. It will only prolong the inevitable. GM has been in decline for a long time.

 

[warlordblee]

1 in 10 jobs in this Country are directly realted to GM, tell me again how it won't be a nightmare.

 

[ATeam]

GM's failure would be a sad story to be sure. The 1 in 10 statistic that has been batted around is a bit of a stretch. As I read it, 1 in 10 jobs are tied to the automotive industry, not to GM. It is ironic for GM to be tossing the number out. A lot of those 1 in 10 jobs are in brand new plants in Southern states. They are not suffering from poor business practices and they are not asking for taxpayer money to breath false hope into a corpse. If GM is pronounced dead, the U.S. automotive industry will not cease. Cars will still be built in this country.

If bailout money is to be spent to save jobs, I would much rather see it used to pay construction workers to work on roads, bridges and other infrastructure components.

 

[Lawrence]

Thank every Toyota, Honda, Hyundai etc, etc owner for NOT buying American.

 

[LDB]

In many cases that American made Honda has more U.S. content than the Mexican made Ford on the next lot. Ownership is global for all the companies so it's more the U.S. content that makes a difference than the home nation of the builder I'd think.

 

[OntarioVanMan]

Now when they say GM maybe bankrupt are they saying the North American Division/ The European and Asian divisions have been profitable...so maybe they won't build here but be an importer...more to the story

 

[LakeSide]

1 in 10 jobs in this Country are directly realted to GM, tell me again how it won't be a nightmare.

[1 in 10 ?] Not even close. Those numbers of 10% or 1 in 10 were UAW numbers.

The truth is the auto industry directly and indirectly accounts for about 1.5% of the total jobs in this country. This is not a small number of jobs but is not even close to the figure quoted by the UAW.

 

[dodgeboy]

Thank every Toyota, Honda, Hyundai etc, etc owner for NOT buying American.

That is true, Lawrence. But when GM tells me that they will not replace a "factory recalled" component because my van had over fifty thousand miles on it , it just made me decide to get my next van from a different manufacturer. My GM van had a defective fuse box due to a falty design that caused all of my relays and switches to go out "cost to repair it; 800 bucks!" I will never purchase a GM van ever again because they treated me like a second class citizen.

 

[ATeam]

I don't want to minimize or soft peddle the negative effects of a GM bankrupcy. A recent CNN article describes them well. Even if the numbers source is dismissed as bias and the numbers are reduced by half, a GM bankrupcy would have a negative economic impact.

But the problem is, bailout or not, GM is a gonner. I would support post-bankrupcy aid to GM to help people and business move to their next jobs and next places . Some will stay in the automotive industry. Others will not. That would be aid that helps the U.S. automotive industry move on and get to where it needs to be to become prosperous once again. Pre-bankrupcy aid would only bolster the current contracts and practices that got GM into this fix in the first place.

 

[ATeam]

Thank every Toyota, Honda, Hyundai etc, etc owner for NOT buying American.

Diane and I are among them, but not for lack of trying to "buy American" as some call it. At one point in our lives, Diane drove a Toyota and I drove a Honda. Feeling an urge to do the patriotic thing and needing to replace the Toyota, we bought a Ford.

In the first year, the Ford broke down more than the Toyota did in all the years Diane owned it. The Ford dealers were highly skilled in explaining why they could not be expected to fix it and unskilled in actually repairing the car.

Needing reliable transportation and not needing to pour time, money and energy into the black hole we found Ford dealers to be, the common sense thing to was take the loss on the car and return to the brands that served us best. We traded the newer Ford in on an older Honda and have never been happier with a car. (Now spending most of our time on the road, we own no cars and rent one when needed.)

And about the "buy American" thing, the Hondas we drove were built in Ohio. The Volvo truck we now drive was built in Virginia with major components (reefer, truck body, sleeper, etc.) being built in other U.S. states.

We honestly tried to do the patriotic thing by buying a Ford. We did not buy the car because it set itself apart with its price and features. We bought a Ford for patriotic reasons. The result was a loss of money and time that no American company or worker will ever repay. We gave Ford a true chance. Ford proved unworthy of our patriotic loyalty and lost us for life as customers.

We learned our lesson the hard way. Patriotic loyalty is not blind loyalty. It is something you give to your country. It is not something to vest in a for-profit corporation that builds inferior products fails to serve its customers well.

A recent CNN article says, "GM and the other Detroit automakers are trying to win support from an American public that has largely turned their back on them. Sales by the U.S. companies account for only 47% of domestic sales this year, according to sales tracker Autodata."

It is not without good reason that consumers have voted with their feet and walked away from U.S. automobile companies. And that is sad.

 

[pjjjjj]

I haven't read that article yet, but I will, thanks for posting that link ATeam.
If whatever percentage of vehicles are bought per year, made by GM, or the other 2 for that matter, this does not mean that suddenly there will be *this* many less cars sold, correct? The same number of cars will be sold, whether or not one of these companies does not exist any more. That lost GM biz will go to another company instead, maybe a company that might manage their people and product and relationships better. That co getting the new biz would have to therefore expand, wouldn't it? They'd have to hire more people. At least, that's what I'm thinking.
Secondly, isn't this about the freedom that many posters on EO have been crying about losing, with the election of a certain candidate? Companies set up shop, they sell product, they make a name, and before you know it, other companies are out of business as a result. Isn't that how the game is played? It's the same in most businesses, isn't it? Those that can keep up with the times, the quality, the pricing, the relationships.. they're the ones who win, at the expense of those who don't.

 

[OntarioVanMan]

I haven't read that article yet, but I will, thanks for posting that link ATeam.
If whatever percentage of vehicles are bought per year, made by GM, or the other 2 for that matter, this does not mean that suddenly there will be *this* many less cars sold, correct? The same number of cars will be sold, whether or not one of these companies does not exist any more. That lost GM biz will go to another company instead, maybe a company that might manage their people and product and relationships better. That co getting the new biz would have to therefore expand, wouldn't it? They'd have to hire more people. At least, that's what I'm thinking.
Secondly, isn't this about the freedom that many posters on EO have been crying about losing, with the election of a certain candidate? Companies set up shop, they sell product, they make a name, and before you know it, other companies are out of business as a result. Isn't that how the game is played? It's the same in most businesses, isn't it? Those that can keep up with the times, the quality, the pricing, the relationships.. they're the ones who win, at the expense of those who don't.

No ones addressed my query about is it only the North American operation going belly up...overseas divisions have been profitable...

 

[Moot]

My GM van had a defective fuse box due to a falty design that caused all of my relays and switches to go out "cost to repair it; 800 bucks!" I will never purchase a GM van ever again because they treated me like a second class citizen.

Were you treated poorly by G.M. or a particular dealership. I had a similar problem with my 2004 van. I was trying to hook a friend's boat trailer to my van and did some unintentional arc welding resulting in a blown fuse. Of course the blown fuse wasn't located in the pain-in-butt-to-get-at fuse box under the driver's seat. It was one of the larger fuses located in the huge-pain-in-the-butt-to-get-at fuse box mounted under the hood. The one with the power steering lines routed over the cover.

Anyway I did a number on the cover, the plastic hinges and the cheesy latches. I taped the cover back on with duct tape and forgot about it. A year or so later I got a recall notice from G.M. about the p.o.s. fuse box under the hood. Had a new cover installed at a local Chevrolet garage. No charge.

If G.M. fails, so what. As mentioned their days are numbered and a bailout will only prolong the inevitable.

Paging Dr. Kevorkian. Dr. Kevorkian please report to Detroit. Code Blue. Code Blue.

 

[davekc]

A significant percent of the first 25B they got went for executive bonuses. Or, GM called them retention bonuses.
What would be the value of retention to people that ran them into the ground? The foreign competitors whether Toyota or whomever are much better managed and don't have their hand out.
The big three for too long have developed a way too long sense of entitlement. That goes for their management right through to the unions.
I think before they throw additional money in a sinking ship, they need to get rid of the management that is currently there. Then again, it may be very well too late for that. But, where one leaves, another will step in.

 

[chefdennis]

1st, WHEN they fail, it will be with or without the gov bailout, it is going to happen.

2nd, they won't be gone, they will simply reorganize, restructure and get rid of the union contracts. Wages will be lower and management smaller and alot of lines gone.

As for the oversea operations, They are trying to sell off as many as they can now to raise money. Hell, not all of their US plants are doing bad, just a chosen few.

For me, its let them , ford and chysler fail. They will be back, leaner or absorbed into one of the other companies.

GM trying to buy Chysler was simply to absorb the competition, keep the profitable parts, and get rid of the rest, including duplication of product, and employees. I think this is what you will see sooner or later anyhow. No Bailout, let them fold. They will find their way back to the market in another form.

PS: not to steal the thread, but a small look at product planning by these idoits, the Toledo, Ohio jeep plant is STILL and with the exception of 14 days is building 560 jeep wranglers a day on all 3 shifts, they are recieiving on average, 138 orders from dealers a day...... Sooo, the days supply goes through the roof, on both the factory floor and the dealers lots, since no one is buying, more layoffs come.

Very sound planning.....

 

[Jack_Berry]

ya know cd, i never understood why more cars are built than ordered. more importantly where do all the unsold cars go to at the end of the model year? do they get sent to a third world country like the super bowl loser togs?

 

[arrbsthw]

Thank every Toyota, Honda, Hyundai etc, etc owner for NOT buying American.

Maybe GM and the rest of the US companies would
make a car that didn't sell for $50,000 they could
sell some of those cars to us poor people and
they would be making money like Nissan, toyota and Honda.

 

[chefdennis]

jack _berry wrote:

i never understood why more cars are built than ordered. more importantly where do all the unsold cars go to at the end of the model year?

Believe it or not jack, they allot end up on dealers lots. There is always a dealer that will take them (well there always HAS BEEN, who knows anymore) that will sell them as close to his inventory cost as he can and move them. Some also go to rental companies and fleet companies both at discounted prices that are then written off as loss for the manufacturer.

 

[BillChaffey]

I have two Fords, one an 1999 F 250 Super Duty has 270,000 miles. Other then replacing upper & lower Ball joints (County Roads in MO. are Gravel) and a Sensor, I have had no problems with it. My other Ford is a 2002 E 350 Cargo Van with 235,000 miles on it, with no problems. I have a friend on the Eastern Shoe of Maryland with a 1987 F 150, it's now a "Farm truck" with over 900,000 miles on it. I would expect there are other persons besides myself who have found Fords to be reliable.