Six Myths about the Big Three

by: Rick Newman November 21, 2008 | about stocks: F / GM    

Rick Newman

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Memo to CEOs: Ask for a bailout, and your company will be reduced to a caricature.

Recent congressional hearings on the plight of GM (GM), Ford (F), and Chrysler have illuminated a few important issues - like how the Detroit executives travel when on business. Populist politicians and gotcha journalists delighted at the prospect of rich CEOs riding corporate jets to ask for taxpayer money. There was a little talk about jobs and cars and the foundering economy, too. But you might have missed that part, or gotten confused by a welter of misperceptions that emerged from the spectacle of supplicant CEOs trying last-ditch tactics to save their companies.

As the automakers careen toward bankruptcy, here are some of the myths complicating the debate over the future of the Detroit Three:

They don't build small cars. The Detroit Three build plenty of small cars - they're just not very good. In the U.S.News rankings of affordable small cars, for instance, seven out of 34 models are domestics. But the highest ranked - the Chevrolet Cobalt - lands at No. 20, while the top three are all Hondas (HMC). So, CEO Rick Wagoner is telling the truth when he says that in 2009 GM will offer 20 models (including a few mid-sized cars, a couple small sports cars, and a few others) that will get 30 mpg on the highway. The question is whether anybody will want to buy them - and if not, is it the government's job to subsidize uncompetitive products.

They don't build any desirable cars. A few recent Detroit models have been hits, like the Ford Fusion, Chevrolet Malibu, Cadillac CTS, and Saturn Outlook. And even Consumer Reports, which has mercilessly trashed Detroit's shoddier vehicles, recently issued a statement saying, "We've seen some progress among the domestic automakers lately, with improved reliability and performance in certain models."

The problem is that the domestics are strong in a few segments, while weak - or nonexistent - in many others. So when soaring gas prices and a stumbling economy torpedoed their flagship vehicles - trucks and SUVs - there wasn't much else to balance out the portfolio. Neither GM nor Ford offers a competitive minivan, for instance. Their small crossovers and SUVs haven't kept pace with the best offerings from Honda and Toyota (TM). And a puny "B car" that's actually fun, like the Mini Cooper or Honda Fit? Does not compute. And it's pretty hard to survive as a global car company when you simply write off a big chunk of the market.

The same guys asking for handouts are the ones who caused the problems. Not really. Chrysler CEO Bob Nardelli and Ford CEO Alan Mulally are new arrivals recruited from outside the auto industry. Their boards offered them a lot of money because of their expertise on fixing huge, messed-up organizations. Wagoner has been on the job longer, and he bears more responsibility for some of GM's problems. But he wasn't in charge in the 1980s and 1990s, when GM built sprawling factories that are approaching obsolescence, let quality slip, and short-shrifted cars in favor of SUVs. And since becoming CEO in 2000, Wagoner has overseen many improvements at GM, like an improved car lineup, more efficient factories, and success in China and other overseas markets. He may still get the boot, but he's probably done more to fix GM than the three or four CEOs who preceded him.

The CEOs should fly coach. At about the same time the Detroit Three CEOs were boarding corporate jets to head to Washington for recent congressional hearings, Northwest Flight 234 (on-time percentage: 77 percent) was backing away from the gate at Detroit Metro, headed for Reagan National Airport, across the river from the Capitol building. Obviously, the CEOs should have been on that flight instead of a Gulfstream, relaxing with some free coffee and reading the morning paper before huddling with aides (please remain seated, with your seatbelts fastened) to discuss emergency measures like which division to sell off or which supplier to stop paying. They'd have to speak in whispers, since a couple dozen reporters looking for a scoop would no doubt be sitting in nearby rows - but at least that way nobody would disturb other passengers trying to catch a nap. And if there were any urgent calls from outposts in Shanghai or Dubai, United Arab Emirates, or São Paolo, Brazil, somebody back at HQ with a reliable phone connection could just handle it.

Sure, these are complex global companies with command decisions that need to be made every hour. But if the CEOs are going to ask for the people's money, they should take the people's transportation! Come to think of it, instead of flying, they should have pooled their money and chartered a bus for the trip to Washington.

It's all the unions' fault. Generous union protections clearly pumped up Detroit's costs in the past and added to bloat, but recent concessions have solved many of those problems. Many other factors now weigh more heavily on Detroit: Soaring healthcare costs, especially for retirees the automakers are still responsible for; poor strategic planning; and buyers who can't get loans. The biggest problem with the unions might be unrealistic expectations fostered by leaders like Ron Gettelfinger - because many of the job and wage protections of the past are no longer there.

They've done nothing to help themselves. All three Detroit automakers have slashed costs and closed factories over the past few years, in aggressive but methodical efforts to become profitable once again. If we still had the 2006 economy, they might make it by 2010 or 2012. But obviously we don't. What the Detroit Three haven't done is something dramatic that would send the silverware flying, like killing off overlapping divisions such as Mercury, Pontiac, and Saturn, closing redundant dealerships, or demanding universal healthcare to help manage soaring medical costs. If the government coughs up some "bridge" money to tide them over for a few months, there's no reason to think much would change. But if the automakers land in bankruptcy, plenty will change - and self-help will no longer be an option.

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This article has 29 comments:

  •  
    Nov 21 05:36 AM
    For Ford technically we are seeing a major 3rd wave of the down-trend ending for Ford, and now looking for a upside bounce to the 4th wave, then back down again into the 5th wave later on. The short term is an A B C looking to move to the upside.

    For General Motors technically we are seeing a major 3rd wave down-trend ending for GM, and now looking for a upside bounce to the 4th wave, then back down again into the 5th wave later on. The intermediate term shows a ending 5th wave for a move to the upside.

    Click the link below to review the software we used to determine this techincal analysis.

    www.invest2success.com...

    Good day and good trading!

    www.invest2success.com
    Reply | Link to Comment
  •  
    Nov 21 05:52 AM
    Disaster? Not really, I can hear the excitement in the replacement parts industry and the auto repair shops as they prepare to expand their facilities and prepare for the swarm of new customers (at realistic prices) as the giants (small g) collapse. Their customers WILL be pleased.
    Reply | Link to Comment
  •  
    Nov 21 06:48 AM
    At a time of financial crisis it's important to get your facts straight. There is no doubt that Mercury and Pontiac are "overlapping lines." That is not true of Saturn. GM has turned Saturn into its US version of Opel (which is very successful in Europe). The Saturn Astra, Aura and Vue are not replicated by any other GM line. The Sky is almost the same as Pontiac's Solstice, but it is a niche vehicle. That leaves only the Outlook as a vehicle that is replicated by other GM lines. The problem at Saturn (and to a greater extent at Saab) is that their marketing budgets are not large enough to get their message out to the market.
    Reply | Link to Comment
  •  
    Nov 21 07:22 AM
    Gm makes a few good products, We have a Pontiac G6 (2006) my wife drives it everyday and when I get a chance to drive it I have alot of fun, good power and handles nicely. Our other car is a truck, 2005 Silverado stepside. I love this truck because you don't see alot of them out there and it hauls ass it's light and all motor. I use it everyday for my pool route. the only work done so far has been oil changes and tires(knock on wood). I know GM can make a go of it but they need to face reality. File chapter 11 and get out from under the mess with the union and local dealers. We'll still be a GM family if they do. The TARP bailout is a kiss of death.
    Reply | Link to Comment
  •  
    Nov 21 07:30 AM
    In normal times, I'd say, throw them to the wolves, but in this economy... 25 billion would be ridiculously cheap compared to the negative knock-on effects. If for 25 billion you can postpone their bankruptcy by a couple of years, then that's money very well spent. But I suspect many here are ultrashort and would only be too happy for a new Great Depression.
    Reply | Link to Comment
  •  
    Nov 21 08:00 AM

    No doubt these 3 CEOs shouldn't fly on a scheduled airline flight - after all - by the time you add the expense of body guards, the 20 assistants that they bring along, the extra seats on the left and right for their brief case (can't expect them to work with one seat), and so on, they might as well have flown on their own jet.

    Can you imagine what Northwest Airlines would have charged for in flight service of congac, caviar, and wine? Just the checked baggage surcharge would wipe out any cost savings.

    Perhaps the final lesson that Detroit CEOs need to take from their Japanese counterparts is how to handle a similar crisis at a Japanese company.

    Seppuku in front of Congress.
    Reply | Link to Comment
  •  
    Nov 21 08:04 AM
    Throw them to the wolves. Chapter 11 bankruptcy will force them to re-organize. They'd better wise up and start building cars that can drive past a repair station and not need a repair. Can you believe the Big 3 did not have a "business plan" when they appealed to congress for a bailout? "What? (they said) We need a plan?!!!" When I think of GM cars, Ford cars, Chrysler cars....I think 'rattle-trap'. They better get on the stick, or die. That's capitalism, and capitalism works.
    Reply | Link to Comment
  •  
    Nov 21 08:15 AM
    Much better article today than yesterday.
    Reply | Link to Comment
  •  
    Nov 21 08:24 AM
    EVERY article on Seeking Alpha has a "they build crap and let 'em fail" tone. THERE IS NO BALANCE ON SEEKING ALPHA!!!! They seem to have an agenda and are letting the same five or six writers pursue it for them.
    Reply | Link to Comment
  •  
    Nov 21 08:56 AM
    One question that needs to be asked in all of this but has not is this: Is there still room in the U S market place for all 3 domestic car companies? It does not appear to me that there is. If we as taxpayers are asked to save these, the question should be asked which are worth saving. Chrysler is not even a publicly owned company. Why even bother with that one at all. If it is worth saving let Cerberus save it.

    It was not a big deal back in the 60s when Studebaker fianally went under. And I don't think anyone really missed AMC all that much when it finally faded from the seen, althought the Hornet wagon is something that some of us miss especially now that the small wagon virtually has ceased to exist.
    Reply | Link to Comment
  •  
    Nov 21 08:58 AM
    Well the fact of the matter is they DO build crap. Their ignorance to staying ahead of the game has caused their demise, and their cheaply made products are winning over less and less buyers each year.

    Toyota launched their Prius in 2000, almost 9 years ago! Come on! These guys were too caught up in the moment selling gigantic SUVs, and now look at them. And the small car segment is horrible. Would you buy a Cobalt or a Civic? Most would prefer the Civic. Would you rather be in an accident in a Cobalt or a Civic, that's the better question.

    In business you stay ahead of your competitors, and they have failed to do so. Now quit the whining and deal with the ramifications.

    The reason for the 'tone' of the articles about the Big 3 is that most people have the same opinion about the current situation. Poor management, poor products, failed ingenuity = too bad.
    Reply | Link to Comment
  •  
    Nov 21 09:02 AM
    Mister Jimmy,
    Frankly, they have an inferior line of products if not all inferior products, made more unsustainable by the amount of liabilities they have for non-productive workforce (eg. Job Bank Program). That is not to say that they should be fed to the wolves along with all of their employees. So far, there is nothing that would let them wriggle out of their more expensive contracts other than Chapter 11, and you know what that is.

    Unless the Congress charter something specifically to let them restructure the payroll as well, the three autos won't have much breathing rooming even with the bailout, frankly I suspect not even early 2009 end, so rather than feed them to the wolves, I would like to think of it as forced amputation.

    I would agree that many articles are cold on bailing out the autos, but clearly this article is not one of them. Also, what gets negative publicity about union pay is more of the legacy contracts. I have read enough articles to realise that current contracts at the autos are no longer that attractive, but that doesn't mean they are can run from their earlier "covered for life" obligation. That is an area they need to restructure. I'm not sure if that idea is sustainable but cutting it might flip the coin of fair work benefits the other way.

    I kind of forgot the CEO tenure flight expenses. It is interesting to remember that the ones getting stoned are usually the ones that are solving the problem, other than the GM case. Still, I'm surprised they failed to add lip service on the "selling their corporate planes" question when it was a politically correct answer. Goes to show how much power the media has and is abusing for tv ratings.
    Reply | Link to Comment
  •  
    Nov 21 09:14 AM
    At least Mr Newman got a few facts correct in this article. Messrs Nardelli and Mulally are both new to their companies, less than one new product cycle. The "off with their heads" crowd are clueless. Those clamoring for "a plan" don't seem to realize that these are three competing companies in the private sector with different problems and approaches to fixing their particular problems. In the case of Ford, at least, Mr Mulally has laid out a very specific plan to bring the company back to sustainable profitability, but no one in Washington seems to know or care. The only thing more disheartening than the poor performance of the three CEO's before Congress, was the childish grandstanding by Senators and Congressmen.
    Reply | Link to Comment
  •  
    Nov 21 09:41 AM
    It would probably take $100 billion to fend off bankruptcy for much more than a year. Emergency response may be too slow for this car crash.
    Reply | Link to Comment
  •  
    Nov 21 10:01 AM
    I think the comments I keep reading are a dissapointment to intelligent people. Do you know what the Big 3 do to try to get the chance to build great new products? Do you know the hoops they are required to go through by the government? America builds great product and the media and wall street say the product is not relevant. Do yourself and America a big favor. Do your own research. Dont read the slanted magazine reports and the blogs that are filled with hatred for America. Go talk to a trained sales consultant. Let them tell you comparision statistics and their thoughts why their vehicle is a better value. On Star- GM has been saving lives with this one of a kind product for over 9 yeras. 5 Year or 100,000 warranty for GM. They stand behind the product. American car companies have what we call recalls. The imports have bulletins?
    Flying corporate jets. Do you undertsand that GM has design centers all over the world. They work as a global team 24 hours a day to design great product. Corporate leaders need to work 30 hours a day and they only have 24. Get off the Washington and media spin and look at reality. Support Americans. How do the heads of Toyota and Honda come to America? Oh maybe they dont so that means we get them to spend none of their American profits in America. Everyday we keep letting spin doctors control our thoughts the closer we are getting to a disaster.
    Go out and test drive a Pontiac Solstice. G8, G6 or G5. WHat about the vibe or great value Torrent? Sierra, yukon, acadia, enclave or lucerne. The people saying the negative comments have never walked in a Domestic showroom. The reason is they made their minds up in the 1980's and that product was no good. They were right then but sadly mistaken now. Take the challenge and you will see why you should be proud of Domestic car companies.
    Reply | Link to Comment
  •  
    Nov 21 10:19 AM
    The leaders of those companies wouldn't have had to. The Japanese government wouldn't have hesitated to help their automakers in a similar situation. They have always been subsidized and protected by their government. not the same here, obviously.


    On Nov 21 08:00 AM No Comment wrote:

    >
    > No doubt these 3 CEOs shouldn't fly on a scheduled airline flight
    > - after all - by the time you add the expense of body guards, the
    > 20 assistants that they bring along, the extra seats on the left
    > and right for their brief case (can't expect them to work with one
    > seat), and so on, they might as well have flown on their own jet.
    >
    >
    > Can you imagine what Northwest Airlines would have charged for in
    > flight service of congac, caviar, and wine? Just the checked baggage
    > surcharge would wipe out any cost savings.
    >
    > Perhaps the final lesson that Detroit CEOs need to take from their
    > Japanese counterparts is how to handle a similar crisis at a Japanese
    > company.
    >
    > Seppuku in front of Congress.
    Reply | Link to Comment
  •  
    Nov 21 10:30 AM

    You don't know waht you're talking about. THEY DO NOT BUILD "CRAP".
    The Cobalt is actually a very good car, with good quality numbers. Ever even looked at one? A Civic is no safer in a crash; that's rediculous.
    The writer of this article forgot about the Aveo as well. A direct competitor with the fit.

    Look at some FACTS about GM before spout blind insults:
    – North America Car of the Year: Chevrolet Malibu and Saturn Aura
    – Motor Trend Car of the Year: Cadillac CTS
    – European Car of the Year: Opel Insignia
    – Green Car of the Year (LA Auto Show): 2-Mode Hybrid Chevrolet Tahoe
    – 11 of last 13 U.S. launches have been cars or crossovers, the truck launches were hybrids
    – J. D. Power Initial Quality Survey: In 2008, GM had more segment leaders than Toyota or Honda, and GM has improved overall survey performance by 25% in last 5 years
    – Reduced number of warranty repairs by 40% over the last 5 years, and are on track in 2008 to achieve a further 15% reduction vs. 2007 levels
    – 20 GM vehicles with EPA highway fuel economy of 30 mpg or better (most of any manufacturer, domestic or import)
    – World leader in bio-fuel vehicles with over 3 million FlexFuel vehicles on U.S. roads today, with commitment to reach 50% of annual GM volume by 2012
    – 6 hybrids in U.S. today, 2 more by year-end (most hybrid models of any automaker)
    – Largest hydrogen fuel cell vehicle test fleet in the world
    – Chevrolet Volt (E-REV) production on schedule to begin in 2010 - first to market!



    On Nov 21 08:58 AM sickofthehype wrote:

    > Well the fact of the matter is they DO build crap. Their ignorance
    > to staying ahead of the game has caused their demise, and their cheaply
    > made products are winning over less and less buyers each year. <br/>
    >
    > Toyota launched their Prius in 2000, almost 9 years ago! Come on!
    > These guys were too caught up in the moment selling gigantic SUVs,
    > and now look at them. And the small car segment is horrible. Would
    > you buy a Cobalt or a Civic? Most would prefer the Civic. Would you
    > rather be in an accident in a Cobalt or a Civic, that's the better
    > question.
    >
    > In business you stay ahead of your competitors, and they have failed
    > to do so. Now quit the whining and deal with the ramifications.
    >
    >
    > The reason for the 'tone' of the articles about the Big 3 is that
    > most people have the same opinion about the current situation. Poor
    > management, poor products, failed ingenuity = too bad.
    Reply | Link to Comment
  •  
    Nov 21 10:40 AM
    I drive a Cobalt SS and get 38mpg on freeway, 28mpg local. My wife's 2008 Torrent 260hp GXP can get 20mpg local. My son's 2003 Honda accord gets 22mpg local and a brocken transmission at 50,000 miles. It is not the quality nowadays, it is mostly reputation and brand name. I hope the consumer report can be a real non-bias tribune.
    Reply | Link to Comment
  •  
    Nov 21 10:51 AM
    For all you who love to ignorantly spout your cynical distain for your own country's companies, the following applies specifically to GM, but both Ford and Chrysler are similar in the changes they’ve made too.

    Think GM has done nothing to improve their business and cost structure? Facts:
    • Reduced structural cost by $9 billion from 2005-2007 (down 22%) with plans for further reductions of $5 to $6 billion by 2011 (down ~35%)
    • Rightsized manufacturing capacity: From year-end 2004 to year-end 2007, GM removed 1.3 million units of assembly capacity (24% net reduction)
    – Further rightsizing planned with reduction of 0.7 million units by year-end 2010 (total net reduction of 36%)
    – More than 60% of remaining capacity at year-end 2010 will be dedicated to fuel efficient cars and crossovers
    • Streamlined U.S. operations: Total headcount reduced from 177,000 in 2002 to 93,000 today (47% reduction)
    • 2007 UAW Hourly Labor Agreement provides basis for competitive manufacturingbase in U.S. by 2010
    • Historic agreement with UAW to fund retiree health care obligations with independent VEBA trust, eliminating majority of risk related to U.S. retiree healthcare starting in 2010
    • GM leads in manufacturing productivity in 11 out of the 20 North America segments in which it competes (2008 Harbour Report)
    – GM also has 5 of the top 10 best rated engine plants in North America, and the #1 transmission plant, all located in the U.S.

    Think GM Builds nothing but crappy, gas-gusslers?Facts:
    – North America Car of the Year: Chevrolet Malibu and Saturn Aura
    – Motor Trend Car of the Year: Cadillac CTS
    – European Car of the Year: Opel Insignia
    – Green Car of the Year (LA Auto Show): 2-Mode Hybrid Chevrolet Tahoe
    – 11 of last 13 U.S. launches have been cars or crossovers
    – J. D. Power Initial Quality Survey: In 2008, GM had more segment leaders than Toyota
    or Honda, and GM has improved overall survey performance by 25% in last 5 years
    – Reduced number of warranty repairs by 40% over the last 5 years, and are on track in 2008 to achieve a further 15% reduction vs. 2007 levels
    – 20 GM vehicles with EPA highway fuel economy of 30 mpg or better (most of any manufacturer, domestic or import)
    – World leader in bio-fuel vehicles with over 3 million FlexFuel vehicles on U.S. roads today, with commitment to reach 50% of annual GM volume by 2012
    – 6 hybrids in U.S. today, and 2 more by year-end 2008 (most hybrid models of any automaker)
    – Largest hydrogen fuel cell vehicle test fleet in the world
    – Chevrolet Volt (E-REV) production on schedule to begin in 2010

    Think GM doesn’t affect the total economy that much? Facts:
    - Directly employs nearly 240,000 people
    - Provides healthcare to 2 million Americans and pension benefits to
    775,000 retirees and spouses
    - Supports another 5 million jobs at dealers, parts suppliers and
    service providers
    - Comprises nearly 4% of U.S. GDP
    - More than $225 billion invested in U.S. over last 2 decades,
    including $10 billion in 2007 alone
    - $12 billion spent annually in U.S. on R&D, exceeding aerospace,
    medical equipment and communications
    - Purchased $156 billion in U.S. auto parts in 2007, supporting jobs in
    all 50 states
    - Largest purchaser of U.S. steel, aluminum, iron, copper, plastics, rubber and electronic chips
    Reply | Link to Comment
  •  
    Nov 21 11:08 AM
    birder:

    Why not capitulate completely and have just one car company, just one insurance company, just one company in all categories. That's what they want! No competition. Buy whatever we build and we don't care if you like it! That way they can tell the gov't to pound sand when they pass laws adversely affecting their products. Just stop making or selling them until the gov't relents, who cares about the workers who make their products. They're just another commodity!

    Let us all kneel before our supreme lord and god the almighty corporation!




    On Nov 21 08:56 AM birder wrote:

    > One question that needs to be asked in all of this but has not is
    > this: Is there still room in the U S market place for all 3 domestic
    > car companies? It does not appear to me that there is. If we as
    > taxpayers are asked to save these, the question should be asked which
    > are worth saving. Chrysler is not even a publicly owned company.
    > Why even bother with that one at all. If it is worth saving let Cerberus
    > save it.
    >
    > It was not a big deal back in the 60s when Studebaker fianally went
    > under. And I don't think anyone really missed AMC all that much
    > when it finally faded from the seen, althought the Hornet wagon is
    > something that some of us miss especially now that the small wagon
    > virtually has ceased to exist.
    Reply | Link to Comment
  •  
    Nov 21 11:14 AM
    Nice to see some facts for a change. Oh, and for all of those folks who claim that GM builds cars that nobody wants, as I recall, more people buy GM cars, not just in the U.S., but around the world, than any other manufacturer. So, somebody likes their products. GM probably made a tactical mistake by focusing its hybrids on the segment with the worst fuel economy - trucks. It is hard to fault their reasoning, however. Why spend a gazillion dollars to raise the fuel economy of an econobox from 30 to 35 mpg when the same investment can make a material difference in the least fuel-efficient segment. Oh well, no good deed goes unpunished.


    On Nov 21 10:51 AM Repper wrote:

    > For all you who love to ignorantly spout your cynical distain for
    > your own country's companies, the following applies specifically
    > to GM, but both Ford and Chrysler are similar in the changes they’ve
    > made too.
    >
    > Think GM has done nothing to improve their business and cost structure?
    > Facts:
    > • Reduced structural cost by $9 billion from 2005-2007 (down 22%)
    > with plans for further reductions of $5 to $6 billion by 2011 (down
    > ~35%)
    > • Rightsized manufacturing capacity: From year-end 2004 to year-end
    > 2007, GM removed 1.3 million units of assembly capacity (24% net
    > reduction)
    > – Further rightsizing planned with reduction of 0.7 million units
    > by year-end 2010 (total net reduction of 36%)
    > – More than 60% of remaining capacity at year-end 2010 will be dedicated
    > to fuel efficient cars and crossovers
    > • Streamlined U.S. operations: Total headcount reduced from 177,000
    > in 2002 to 93,000 today (47% reduction)
    > • 2007 UAW Hourly Labor Agreement provides basis for competitive
    > manufacturingbase in U.S. by 2010
    > • Historic agreement with UAW to fund retiree health care obligations
    > with independent VEBA trust, eliminating majority of risk related
    > to U.S. retiree healthcare starting in 2010
    > • GM leads in manufacturing productivity in 11 out of the 20 North
    > America segments in which it competes (2008 Harbour Report)
    > – GM also has 5 of the top 10 best rated engine plants in North America,
    > and the #1 transmission plant, all located in the U.S.
    >
    > Think GM Builds nothing but crappy, gas-gusslers?Facts:
    > – North America Car of the Year: Chevrolet Malibu and Saturn Aura

    >
    > – Motor Trend Car of the Year: Cadillac CTS
    > – European Car of the Year: Opel Insignia
    > – Green Car of the Year (LA Auto Show): 2-Mode Hybrid Chevrolet Tahoe

    >
    > – 11 of last 13 U.S. launches have been cars or crossovers
    > – J. D. Power Initial Quality Survey: In 2008, GM had more segment
    > leaders than Toyota
    > or Honda, and GM has improved overall survey performance by 25% in
    > last 5 years
    > – Reduced number of warranty repairs by 40% over the last 5 years,
    > and are on track in 2008 to achieve a further 15% reduction vs.
    > 2007 levels
    > – 20 GM vehicles with EPA highway fuel economy of 30 mpg or better
    > (most of any manufacturer, domestic or import)
    > – World leader in bio-fuel vehicles with over 3 million FlexFuel
    > vehicles on U.S. roads today, with commitment to reach 50% of annual
    > GM volume by 2012
    > – 6 hybrids in U.S. today, and 2 more by year-end 2008 (most hybrid
    > models of any automaker)
    > – Largest hydrogen fuel cell vehicle test fleet in the world
    > – Chevrolet Volt (E-REV) production on schedule to begin in 2010

    >
    >
    > Think GM doesn’t affect the total economy that much? Facts:
    > - Directly employs nearly 240,000 people
    > - Provides healthcare to 2 million Americans and pension benefits
    > to
    > 775,000 retirees and spouses
    > - Supports another 5 million jobs at dealers, parts suppliers and

    >
    > service providers
    > - Comprises nearly 4% of U.S. GDP
    > - More than $225 billion invested in U.S. over last 2 decades,

    >
    > including $10 billion in 2007 alone
    > - $12 billion spent annually in U.S. on R&amp;D, exceeding aerospace,

    >
    > medical equipment and communications
    > - Purchased $156 billion in U.S. auto parts in 2007, supporting jobs
    > in
    > all 50 states
    > - Largest purchaser of U.S. steel, aluminum, iron, copper, plastics,
    > rubber and electronic chips
    Reply | Link to Comment
  •  
    Nov 21 11:29 AM
    I never hear any politicon complaining when they fly on corp jets to the super bowl golf outings kentucky derby. I am sure there are people out there they think they should have gone by horse and buggy like Abe Lincoln Get a life and solve our problem.


    On Nov 21 10:40 AM User 303441 wrote:

    > I drive a Cobalt SS and get 38mpg on freeway, 28mpg local. My wife's
    > 2008 Torrent 260hp GXP can get 20mpg local. My son's 2003 Honda accord
    > gets 22mpg local and a brocken transmission at 50,000 miles. It is
    > not the quality nowadays, it is mostly reputation and brand name.
    > I hope the consumer report can be a real non-bias tribune.
    Reply | Link to Comment
  •  
    Nov 21 02:39 PM
    I love your perception of the big important things CEOs do with every free minute that would absolutely preclude them from saving their companies tens of thousands of dollars at a time where liquidation is a real prospect.

    Small news flash: Lots of CEOs fly coach, and being out of touch for 3 hours -- even today -- is not the end of the world. Talk to some WMT execs sometimes. Company doesn't seem to fall apart.

    This was not a "gotcha" moment. This was an obvious point. When you are asking an investor for money -- at below-market rates no less -- show that you are likely to spend that money responsibly. The very fact that these companies have private airfleets is a disgrace in this day and age. How in the world can they justify job cut one or under-delivering on a single vehicle feature when they're spending money on private air travel? All this to avoid the hassle of *shudder* sitting next to the masses as they shuttle around the country or world?

    Get over it, guys. There's no way the public fisc will be used as a short-term piggy bank when these organizations can't even bring themselves to do the obvious. Money spent here will promptly be lost. Better to let them go into pre-packaged bankruptcy and be done with it.
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    Nov 21 02:56 PM
    Oh, and btw -- to all those apologists for the big 3 (particularly GM domestic), citing recent articles by consumer reports that essentially boil down to "their cars aren't quite the disasters they once were," make sure you read this recent WSJ piece:

    online.wsj.com/article...

    Resale value determines true worth.
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    Nov 21 04:45 PM
    The big problem I think is retiree's health care costs. When I retire from the Fortune 500 company where I work I will still be able to use my company's health insurance policy. But the company won't subsidize me (I will pay the full freight). That's the way it is for most people I've talked to from big companies with good health insurance policies. The Big 3 shouldn't be on the hook for retiree's health care policies and the more they downsize the worse the problem will get, because there will be fewer workers for every retiree. The problem with a bailout, as I understand it, is that it won't change that basic equation, and without a change there it won't be long until the Big 3 are just back asking for more.
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    Nov 21 10:38 PM
    I am shocked that more car consumers don’t go into GM showrooms to look at the cars. What’s wrong with this picture?

    They make good looking, quality cars that obviously an unlearned public doesn’t know about. The commercials GM puts out are excellent - and the product is excellent. Forget about patriotism, these are the best out there.

    I’ve owned five new American cars. (The Fiero was one of them). I never owned a Japanese or foreign vehicle. But I have been in them, and had to rent them. There was nothing stellar about the Japanese vehicle over my American counterpart. It was just a car. (Japanese cars do not hail from the heavens).

    It’s very simple. All the American consumer should do is go to their local GM dealer for the car they are looking at, and really compare. They’ll be surprised at the giant leaps forward GM has made.
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    Nov 22 10:18 PM
    no one said it was ALL the unions' fault ( you sound like a 3'rd grader). but they're a major problem- so get rid of the clowns,
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