GM's Plan "B"

[linkwpc]

"Detroit automakers are busy putting the final touches on its Congress-bound revitalization plans, but all three automakers are also making plans in the event government loans are turned down. GM has a back-up plan, and it reportedly includes more factory closures, white-collar cutbacks, further slashed marketing budgets, and delayed product introductions. Automotive News is reporting that cuts also could hit research and development, which would further hurt the General's ability to compete for global vehicle sales. That's not a good option, but we're guessing it's better than running out of cash and declaring bankruptcy.

GM has already taken billions of dollars out of of its operating costs over the past year, with thousands of job and production cuts, plant closings, and the sale of non-core assets. Those actions were thought to be enough to stem the General's cash burn, but when car sales came to a screeching halt in the third quarter, it became apparent that more serious reductions were needed. GM, Ford, and Chrysler go back to Congress on December 8th to plead its case for low cost government loans. If that meeting goes as well as the first one, plan B may actually see the light of day."

Well at least they are thinking about another plan...

LINK: http://www.autoblog.com/2008/11/25/g...ough-with-cas/

[Angrybird 12]

I heard this morning that Tiger Woods has been dropped, that was 7 Million a year...

[Camaro_Corvette]

I don't like this plan.

[Inspector 17]

At least they are putting together plans. Too bad that they weren't thinking about things like this 6 months ago, a year ago, 5 years. This should be a lesson to all of us: expect the unexpected and have emergency plans for if the worst happens.

[DGthe3]

Originally Posted by camaropete

At least they are putting together plans. Too bad that they weren't thinking about things like this 6 months ago, a year ago, 5 years. This should be a lesson to all of us: expect the unexpected and have emergency plans for if the worst happens.

There is no way that anyone could have predicted the path of the economy over the last year. GM should have been more or less even over the course of 2008. Instead they are set to lose over 10B.

And what could they have done differently over the last 5 years? They have made drastic cuts to their workforce in an attempt to reduce cost, and they have been cranking out hit after hit with almost every new vehicle they introduce. They have come to an agreement with the UAW to significantly reduce their costs come 2010. They've quietly been streamlining their platforms. Despite all that, they are now reduced to selling off their remaining stake in Suzuki which gives them enough cash to last 4 days at their current expenditure rate.

I don't think there are many people who can take an instant and unexpected 30% pay cut and have enough in the bank to ride things out for 1-2 years. Thats essentially what has happened to the auto industry this year, the domestic automakers are faring even worse.

Pete, that wasn't all directed at you. You're post was merely an excuse to say a bunch of those things.

[The_Blur]

Originally Posted by DGthe3

There is no way that anyone could have predicted the path of the economy over the last year. GM should have been more or less even over the course of 2008. Instead they are set to lose over 10B.

And what could they have done differently over the last 5 years? They have made drastic cuts to their workforce in an attempt to reduce cost, and they have been cranking out hit after hit with almost every new vehicle they introduce. They have come to an agreement with the UAW to significantly reduce their costs come 2010. They've quietly been streamlining their platforms. Despite all that, they are now reduced to selling off their remaining stake in Suzuki which gives them enough cash to last 4 days at their current expenditure rate.

I don't think there are many people who can take an instant and unexpected 30% pay cut and have enough in the bank to ride things out for 1-2 years. Thats essentially what has happened to the auto industry this year, the domestic automakers are faring even worse.

Pete, that wasn't all directed at you. You're post was merely an excuse to say a bunch of those things.

I am so sick of people saying that GM should have known better. GM just introduced cars like the new Malibu, the 2005 and later Cobalt (less than 5 years old), and other platforms that show that GM has been working hard on its image. It takes a couple of years to make a new car, and GM has been working on these cars since before the market crash. It's ridiculous to say that GM hasn't been working on its image or selling to the best of its ability.