This is a television ad from the Ad Hoc Committee of Consumer Victims of GM and Chrysler urging the President and Members of Congress to make sure consumers are still protected from defective Chrysler and GM vehicles. Those are some pretty harsh words being spoken to the American automakers. It’s enough to make you think twice.
The whirlwind of activity surrounding General Motors these days appears to be far from over. The latest piece of news we’ve heard is that GM is discontinuing the Pontiac Vibe , two weeks after it said that it had plans of continuing the car through next year.
It wasn’t that long ago when GM said that of all the Pontiac cars earmarked for 2010 releases, only the Vibe and the G6 would be rolled out with the G6 specifically earmarked only to fleet customers.
Now, it appears that the Vibe won’t even make to September as GM has just confirmed that production of the Vibe will finish this August, with poor sales – down 35% through May – being largely attributed as the culprit regarding the Vibe’s untimely demise.
In times like this, any form of good news is reason enough for auto manufacturers to jump for joy. So when word came out that J.D. Power and Associates, a marketing and consulting company, released their annual study of vehicle quality and gave flowering remarks to Ford, GM, and Chrysler, you could imagine that these three manufacturers pumping their fists in excitement.
With word coming out from the consulting company that the three automakers have made marked improvements on the quality of their vehicles compared to last year, a collective sigh of relief could be heard coming from Detroit.
Yet despite this vote of confidence, the study also revealed that the three local brands have a lot more work to do before it can catch up to its foreign competitors.
General Motors is not out of the woods just yet.
Despite having been bailed out by the government from bankruptcy, the car manufacturer is still looking for ways to become a more efficient company and one of the ways it plans on being one is by eliminating 4,000 jobs by October 1.
After coming so close being shut down, GM is looking at laying off all these employees as a way to cut costs while they try to recover from the worst economic beatdown the company has experienced in its history.
According to GM spokesman Tom Wilkinson, the company has already addressed its employees of the pending lay-off and is looking for volunteers to give up their jobs – with a promise that they will be offered retirement and buyout incentives. In the event that GM doesn’t get enough volunteers by August, the company will be forced to make involuntary lay-offs, as to which, Wilkinson said is a ‘last case scenario’.
“GM is offering enhanced benefits to employees who volunteer to retire,” Wilkinson said. “Those not eligible to retire who volunteer to leave will get as much as six months’ severance, or as much as a year for executives.” he added.
Continued after the jump.
Finally, the truth comes out. When dissecting the U.S. Government’s decision to bail out both General Motors and Chrysler from the mountain of debt they have incurred throughout the years, it’s easy to point out that Uncle Sam could’ve had ulterior motives in doing this. Perhaps a national stake in ownership of the future automotive conglomerates is what they are looking for?
Yet, when you look at the big picture – we mean the really big picture – you’ll understand that there was a lot more to the deal than meets the eye. Ford Motor Company Executive Chairman Bill Ford Jr. nailed the bull right between the eyes when he said that it wouldn’t just be GM and the pentastar that would suffer if the government hadn’t decided to step up and rescue them. According to Ford the second, the entire automobile industry would’ve taken a very, very serious hit. “It would have been so catastrophic to have a supply-base meltdown because it would have brought down all the auto manufacturers and frankly some other industries as well," Ford Jr. told CNBC TV.
“The United States would’ve been in a lot of trouble if Chrysler and GM were left for dead.”
In so many words, Ford even went as far as saying that the entire U.S. economy would have plummeted if Chrysler and the General went under. If the government hadn’t taken the steps it did, then the bankruptcies would’ve caused a complicated – and maybe cataclysmic – chain of events that would lead to other industries filing their own Chapter 11s, the most affected industries being those with vested interests in the auto industry, including those who supply both GM and Chrysler with the parts they need to build their lineup of cars. It’s a simple case of supply and demand. When there’s absolutely no demand for these parts, why even bother generating any supplies.
It’s easy for all the skeptics to point out that the US government only made the move bailout the automakers for their own self-serving interests; but Henry Ford Jr couldn’t have made the truth clearer when he said, “The United States would’ve been in a lot of trouble if Chrysler and GM were left for dead.”
“I don’t know anything about cars.”
Those were the words of newly-appointed General Motors Chairman Edward Whitacre, Jr. when asked about the challenges he’s facing, charged with infusing some new life into General Motors.
Hardly comforting, don’t you think?
To be fair to the man, it’s not as if he’s a fish out of water in the business world. After all, he’s solely responsible for elevating the status of AT&T as a telecommunications giant. So maybe he doesn’t know the ins-and-outs of the auto industry, but judging from his track record, we ought to cut him some slack and see if he can do for GM what he has already done for AT&T. When you talk to Mr. Whitacre, the newly appointed GM Chairman doesn’t see his lack of knowledge on cars as a burden, but – as expected – a challenge.
"A business is a business, and I think I can learn about cars. I’m not that old, and I think the business principles are the same."
Continued after the jump.
In the wake of its impending bankruptcy, the Detroit-based car manufacturer is not about to give up without a fight.
Word is being spread that despite having filed for a Chapther 11, GM still opened a battery laboratory that is being lauded as one of the country’s most technologically advanced batt labs. It really does make you wonder what’s going on in the minds of the GM bigwigs surrounding the state of GM and its very uncertain future.
Apparently, these guys have decided that if they can’t sell cars, they might as well keep themselves afloat by being at the forefront of advanced battery technology.
In some way, it’s a brilliant idea because it keeps GM in the loop as far as state-of-the-art car technology is concerned. The batt lab – which should never be confused with the Bat Cave – is located in Warren, Michigan and has been called the Global Battery Systems Lab.
Continued after the jump.
Chalk another one up for the economy, first Joe the plumber and now the General. By the time you read this Chevrolet’s parent company General Motors will be filing for Chapter 11 Bankruptcy. What will result is a substantial investment from Canada as well as the United States that will result in the U.S. Government owning about 60% of the American automotive conglomerate and out neighbors to the north receiving 12% as well. This might be good for vehicles like the Camaro that are produced in the Oshawa Plant, these operations should be getting some renewed interest after the deal.
New car buyers will be directly affected, GM choices will now be limited to their core brand Chevrolet, the luxury line Cadillac, their elderly targeted Buick and trucks for hard working Americans from GMC.
The President of the United States, Barack Obama, will address his nation in a press conference regarding the hearing at 11:55 A.M. Current GM CEO, Fritz Henderson, will then address the media about twenty minutes later.
General Motors started a used-car incentive program on Oct. 1 which offered 3.9 percent financing for 60 months on used models of Chevrolet Impala and Silverado, Pontiac G6 and GMC Sierra vehicles. The program was slated to end Jan. 5, yet in an impromptu move GM ended the program early due to the poor credit market.
GM has also announced they are ending automotive lending operations in seven European nations, and scaling back on operations in others. Earlier, GM said financing for vehicles in the United States will no longer be available to customers with credit scores under 700, eliminating roughly 40 percent of customers.
"I think what everybody has recognized is that the market is changing very quickly and we’re looking at availability of credit and it’s just very tight to finance these kinds of programs," GM spokesman John McDonald said.
GM will replace the program Nov. 4, though McDonald did not divulge details.
Like a teenage drag race, it seems the Camaro has stalled in 3rd while trying to overtake the Challenger. Now it also looks like dad is not going to buy a new clutch for the Camaro.
General Motors was looking for about $10 billion in government aid specifically to help facilitate the merger (acquisition) of Chrysler. Although not officially announced, sources involved with the talks have said that the Bush administration is done coughing up cash for the auto industry .
This means GM is now getting shy about courting Chrysler. The door is now open for the other offer on the table, the twenty percent buyout by the Renault-Nissan Alliance. Unlike the GM buyout, which would likely mean the death of most of Chrysler’s products, annexation into the alliance would likely give Chrysler access to new cars. When Renault took a controlling interest in Nissan in 1999 (it was called an alliance to soften the public’s perception of the companies,) Carlos Ghosn, who’s now CEO of both companies, slashed budgets but also shared technology so that new cars could be quickly built at Nissan.
The new problem is that Nissan may not be healthy enough to buy a stake in Chrysler. Today Nissan cut its profit outlook in half. It has reduced production by 200,000 units this year and will trim 3,500 jobs in the United States, Spain and Japan. Renault is already in debt, so it is certain that it will not be able to pay for Chrysler.