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Cougyr
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posted 05 July 2005 07:20 PM      Profile for Cougyr     Send New Private Message      Edit/Delete Post  Reply With Quote 
General Motors shareholders meet with company leaders Tuesday. The meeting could shape the future of the struggling company.

GM stocks have been reduced to junk status. The company lost $1 billion last quarter, and stock shares are at their lowest price in a decade. WXYZ Local News

There was a report on CBC about this. What's happening? Is the American auto market in freefall?


From: over the mountain | Registered: Nov 2002  |  IP: Logged
Cartman
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posted 05 July 2005 07:41 PM      Profile for Cartman        Edit/Delete Post  Reply With Quote 
http://abcnews.go.com/Business/wireStory?id=904284&CMP=OTC-RSSFeeds0312

They are really slugging it out with discounts in order to move stock. This looks really desperate.

quote:
General Motors Corp.'s sales soared 41 percent in June to their highest monthly total in nearly 19 years thanks to a heavily promoted discount that allowed customers to buy cars and trucks at the employee rate, new sales figures showed Friday.

From: Bring back Audra!!!!! | Registered: Nov 2004  |  IP: Logged
Boom Boom
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posted 05 July 2005 07:44 PM      Profile for Boom Boom     Send New Private Message      Edit/Delete Post  Reply With Quote 
According to many, GM still can't build a Civic or Accord. Toyota is building a new plant in Ontario (Woodstock) to meet increasing demand while GM shares go down. Michael Moore's "Roger and Me" is playing right now on TMN by the way - showing GM to be rather heartless in closing down 11 plants in the US while at the same time opening 11 new plants in Mexico. I gather a lot of Americans are mad at GM.

I find GM's declining sales rather odd, given the spate of great new product from Chevy and Pontiac. But I guess the *perception* is that the Japanese product is higher quality for a lower price. I've never owned a GM product in my life, but I had two Fords (Escort and Tempo), one Toyota (4x4 truck), two fantastic Hondas (CRX Si and a Civic Si), an Austin Mini Cooper, and a Sunbeam Imp Sport for racing and rallying. The only GM product I ever considered was a big engine Corvette but no one would insure it.


From: Make the rich pay! | Registered: Dec 2004  |  IP: Logged
Cartman
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posted 05 July 2005 08:13 PM      Profile for Cartman        Edit/Delete Post  Reply With Quote 
Don't you think that they generally make crap though Boom Boom? My wife's Grand Prix was total garbage and they were not that great in helping her out despite buying the warranty. I have rarely ever heard a major problem with Japanese cars.
From: Bring back Audra!!!!! | Registered: Nov 2004  |  IP: Logged
Boom Boom
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posted 05 July 2005 08:33 PM      Profile for Boom Boom     Send New Private Message      Edit/Delete Post  Reply With Quote 
Never had experience with GM myself, so I'm not the one to ask. I checked out their new product line last month, it all looked great, especially the new Pontiacs. The Pontiac Pursuit and G6 look good. Everytime I was in Ottawa except once I rented a new Cavalier - fun to drive. The other car was a loaded Toyota Corolla, and I didn't want to give it back.

Of all the cars I've owned, only the Sunbeam needed more than the usual parts and maintenance, and that's because it was raced and rallied. I own a new Mazda small truck, needs warranty maintenance once a year, I expect to get at least ten years out of it.

Why didn't I buy a GM or Ford? The dealers wouldn't negotiate. Ford trucks in northern Quebec are flying off the lot. It's sticker price or take a hike. So I did, and got a new Mazda leased with no money down. Dodge trucks are way overpriced. The GM dealers wanted an insane down payment ($4000.) for their precious small truck. Actually, so did Ford, but they still can't keep them in stock. Go figure.


From: Make the rich pay! | Registered: Dec 2004  |  IP: Logged
Stephen Gordon
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posted 05 July 2005 09:15 PM      Profile for Stephen Gordon        Edit/Delete Post  Reply With Quote 
This story is a good example of why I think the expression 'corporate power' is over-used. If ever you're tempted to haul it out, think of GM. So big, so much advertising, so many political contacts, but it still can't persuade people to buy its products.
From: . | Registered: Oct 2003  |  IP: Logged
Cougyr
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posted 05 July 2005 09:47 PM      Profile for Cougyr     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Originally posted by Stephen Gordon:
. . . but it still can't persuade people to buy its products.

But it can. GM sales up 41%.

quote:
General Motors Corp.'s sales soared 41 percent in June to its highest monthly total in nearly 19 years thanks to a heavily promoted discount that allowed customers to buy cars and trucks at the employee rate, new sales figures show.
quote:
"We see this as an indication that America's desire for trucks and SUVs is still a strong force in the marketplace," GM vice president of marketing Mark LaNeve said.

The problem, as I understand it, is that in order to sell vehicles, GM has had to offer huge discounts. Thus, the company isn't making any money.


From: over the mountain | Registered: Nov 2002  |  IP: Logged
Dex
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posted 05 July 2005 09:48 PM      Profile for Dex     Send New Private Message      Edit/Delete Post  Reply With Quote 
Although the GM employee discount has sold them a lot of cars, it's cost them boatloads of money. My bet says that it's their way of phasing out the employee discount. Gradually, they'll inflate the prices of their cars to factor in the discount and then everybody will be paying the same price.

The whole quality thing that's trotted out by the NA carmakers is a sham, too. They're forever telling people that their cars are very good quality as they roll off the line. Well, sorry to break it to you folks but, the days when it was a big deal when a brand new car started reliably and went without recall passed you by about 20 years ago. It's like cheering on a teenager for no longer messing their drawers.

You look at longer term resale value and repair histories and GM et al are absolutely pathetic (as are many of the European makers). I think I mentioned this elsewhere at babble, but the latest cars issue of Consumer Reports ranked all of the car brands (i.e., GMC, oldsmobile, pontiac, as opposed to just GM, Ford) according to quality and the top NA brand was I think 19th.

Having been locked out of the truck market for decades due to massive tariffs, the Japanese car manufacturers are just now getting full bore into the truck market. The NA manufacturers are now addicted to discounts (they can't get rid of them now that they've offered them for so long; try to get 0% from Honda or Toyota and they'll just laugh at you) and higher margin SUVs (which are on the way down). It's game over.

[ 05 July 2005: Message edited by: Dex ]


From: ON then AB then IN now KS. Oh, how I long for a more lefterly location. | Registered: Aug 2004  |  IP: Logged
Dex
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posted 05 July 2005 09:57 PM      Profile for Dex     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
"We see this as an indication that America's desire for trucks and SUVs is still a strong force in the marketplace," GM vice president of marketing Mark LaNeve said.
See, this epitomizes GM's problem. Sales were up across the board, but all he cares about are trucks and SUVs. Trucks and SUVs are on the way down. Smaller cars and hybrid vehicles are the way the market is moving. And it's not just the price of gas, either. As with all great fads, the SUV is starting to wane (just as the '57 Chevy and 60s muscle cars eras did) and it's becoming cool to drive zippy little cars like the Mini. Poor guy is in denial.

From: ON then AB then IN now KS. Oh, how I long for a more lefterly location. | Registered: Aug 2004  |  IP: Logged
Boom Boom
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posted 05 July 2005 10:29 PM      Profile for Boom Boom     Send New Private Message      Edit/Delete Post  Reply With Quote 
Top selling US vehicles of 2004, from:
http://msnbc.msn.com/id/5582238

Ford F-Series 432,969
Chevrolet Silverado 322,907
Dodge Ram pickup 223,609
Toyota Camry 213,625
Honda Accord 192,106
Ford Explorer 168,059
Honda Civic 162,483
Ford Taurus 144,035
Chevrolet Impala 139,460
Dodge Caravan

Note the top 3 vehicles are pickup trucks.

edited to add: perhaps trucks sell so well because they're dual purpose vehicles: work and pleasure.

[ 05 July 2005: Message edited by: Boom Boom ]


From: Make the rich pay! | Registered: Dec 2004  |  IP: Logged
Dex
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posted 05 July 2005 10:34 PM      Profile for Dex     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Originally posted by Boom Boom:
Note the top 3 vehicles are pickup trucks.[/QB]
Oh yes, they're big sellers. GM and Ford need to realize, though, that the Japanese carmakers have only just started trying to compete seriously in those markets. Sit back and watch the NA market share shrink like a penis at a polar plunge.

From: ON then AB then IN now KS. Oh, how I long for a more lefterly location. | Registered: Aug 2004  |  IP: Logged
Boom Boom
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posted 05 July 2005 10:44 PM      Profile for Boom Boom     Send New Private Message      Edit/Delete Post  Reply With Quote 
"Sit back and watch the NA market share shrink like a penis at a polar plunge."
From: Make the rich pay! | Registered: Dec 2004  |  IP: Logged
maestro
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posted 05 July 2005 11:08 PM      Profile for maestro     Send New Private Message      Edit/Delete Post  Reply With Quote 
GM's biggest problem is medical. The amount they put into medical for current and retired workers (and their families) is costing them billions.

quote:
GM: Repair health care
By Ed Garsten / The Detroit News
Thursday, February 10, 2005

CEO urges U.S. to help ease skyrocketing tab: Automaker lobbies up to 16 states to cut costs

CHICAGO -- General Motors Corp., facing a $1 billion increase in medical costs this year, is taking the offensive on health care.

In a speech to the Chicago Economic Club today, GM Chairman and CEO Rick Wagoner is expected to call on government and business leaders to urgently push for broad reforms to the U.S. health care system.

GM foots the health care bill for 1.1 million workers, retirees and family members, which cost the company about $5.8 billion last year. The automaker expects the tab to grow to almost $7 billion this year, severely cutting into its bottom line.


Those who think we should privatize medicare to cut costs should have to read this story over and over again.

The Canadian single payer system is much more efficient than the hodge-podge of HMO's, insurers, and what-have-you in the US.


From: Vancouver | Registered: Jan 2005  |  IP: Logged
Dex
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posted 05 July 2005 11:16 PM      Profile for Dex     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Originally posted by maestro:
GM's biggest problem is medical.
It's only a minor part of their problem. Medical insurance doesn't prevent them from building reliable or attractive cars. True, it adds to the pain, but it doesn't account for GM's precipitous drop in market share. Afaik, all carmakers are unionized in their NA operations. Most of them also face the medical issues that GM and Ford face. They each have workforces and pension obligations for companies built for 40% of the market when they're only at about 27 and 20% respectively. Yes, the NA manufacturers have more of an overhang from their retirees, but even if you wiped all of that out, the companies would still be in trouble.

From: ON then AB then IN now KS. Oh, how I long for a more lefterly location. | Registered: Aug 2004  |  IP: Logged
scooter
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posted 06 July 2005 12:53 AM      Profile for scooter     Send New Private Message      Edit/Delete Post  Reply With Quote 
I hate to say it but the unions have made so many sweat heart deals that they're helping bury GM. Its much like the British unions that drove Rover into the ground.
From: High River | Registered: Apr 2004  |  IP: Logged
Hephaestion
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posted 06 July 2005 01:00 AM      Profile for Hephaestion   Author's Homepage        Edit/Delete Post  Reply With Quote 
quote:
Originally posted by scooter:
I hate to say it but the unions have made so many sweat heart deals that they're helping bury GM....

Freudian slip there, scooter?


From: goodbye... :-( | Registered: Dec 2003  |  IP: Logged
Cougyr
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posted 06 July 2005 01:30 AM      Profile for Cougyr     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Originally posted by Dex:
As with all great fads, the SUV is starting to wane (just as the '57 Chevy and 60s muscle cars eras did) and it's becoming cool to drive zippy little cars like the Mini. Poor guy is in denial.

I think you're right, Dex.

Is there any kind of correlation between types of vehicles and political affiliation? Do Republicans buy different vehicles than Democrats do?


From: over the mountain | Registered: Nov 2002  |  IP: Logged
Dex
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posted 06 July 2005 01:50 AM      Profile for Dex     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Originally posted by Cougyr:
Is there any kind of correlation between types of vehicles and political affiliation? Do Republicans buy different vehicles than Democrats do?
It's an interesting question, but I haven't seen any serious articles/studies on this. I suspect there's a lot of overlap, though I have to say that the only Prius, Volvo, and Mini drivers I know are Dems. Although there are a shitload of Hummers lumbering around here (e.g., a local mom & pop businessman here bought a Hummer for each of his two children), I'm proud to say that I don't know any of them. The majority of vehicles are purchased by men (although it's dropped drastically in recent years), but the majority of women lean democrat, so that's sure to wipe out some of the sorting you'd expect to see.

[ 06 July 2005: Message edited by: Dex ]


From: ON then AB then IN now KS. Oh, how I long for a more lefterly location. | Registered: Aug 2004  |  IP: Logged
Dex
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posted 06 July 2005 02:03 AM      Profile for Dex     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
Originally posted by scooter:
I hate to say it but the unions have made so many sweat heart deals that they're helping bury GM. Its much like the British unions that drove Rover into the ground.
Look, I'm not without criticism for unions, but Rover died because their vehicles sucked. Quirky character and a storied past can only carry a company so far. They went bankrupt this year, but they hadn't introduced a new model since 1998.

Upper management is not unionized in any of these companies and they're the ones who decide which vehicles they will make/emphasize. The NA auto industry is dying under the weight of poor decisions made in the past and a lack of fresh new ideas (reinforced by the fact they're all centered in the same city and spend all day every day talking to each other instead of talking to customers and mechanics and other critics), neither of which is the unions' fault.

The legacy air carriers are blaming all of their woes on their unions, too, but upper management is working with an outdated business plan. They simply can't compete with the discount airlines model unless they bite the bullet and completely re-organize.


From: ON then AB then IN now KS. Oh, how I long for a more lefterly location. | Registered: Aug 2004  |  IP: Logged
maestro
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posted 06 July 2005 03:40 PM      Profile for maestro     Send New Private Message      Edit/Delete Post  Reply With Quote 
quote:
The legacy air carriers are blaming all of their woes on their unions, too, but upper management is working with an outdated business plan. They simply can't compete with the discount airlines model unless they bite the bullet and completely re-organize.

It would be interesting to know exactly what the discount airlines 'model' is, and what sort of re-organization the legacy air carriers could undertake that would make them profitable.


From: Vancouver | Registered: Jan 2005  |  IP: Logged

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