GM pays back US & Canadian loans way early

[Brokinarrow]

Originally Posted by FenwickHockey65

Do you have any idea what's going on at GM right now? Future product programs have been pushed up, programs that had been shelved previously are back on track, GM's R&D budget is huge now, incentives are down across the board...

i thought the Camaro, Equinox, Malibu, and Volt were all pretty good examples of that, just to name a few....

[Supermans]

Originally Posted by FenwickHockey65

Do you have any idea what's going on at GM right now? Future product programs have been pushed up, programs that had been shelved previously are back on track, GM's R&D budget is huge now, incentives are down across the board...

How huge is GM's R&D budget is at this point? Just a few weeks ago, General Motors Pensions were underfunded by $17B.

http://www.nytimes.com/2010/04/07/business/07cars.html
April 6, 2010

DETROIT — The pension plans at General Motors and Chrysler are underfunded by a total of $17 billion and could fail if the automakers do not return to profitability, according to a government report released Tuesday.

GM and Chrysler need to make large payments into the plans within the next five years — $12.3 billion by G.M. and $2.6 billion by Chrysler in order to reach minimum funding levels, according to the report, prepared by the Government Accountability Office. Whether the companies will be able to make the payments is uncertain, the report concluded, though Treasury officials expect the automakers will become profitable enough to do so.

If either company’s plan must be terminated, the government would become liable for paying benefits to hundreds of thousands of retirees. The effect on the government’s pension insurer, the Pension Benefit Guaranty Corporation, would be “unprecedented,” the report said. The agency manages plans with assets totaling $68.7 billion, less than the $84.5 billion in G.M.’s plan alone…

The Treasury Department owns 61 percent of G.M. and 10 percent of Chrysler as a result of the emergency loans the carmakers received last year. The government spent $81 billion bailing out the companies and others in the auto industry.

The report issued Tuesday said Treasury officials were confident that G.M. and Chrysler would earn enough to allow the government to gradually sell its stakes. But the report warned that the government could push the companies out of business, consequently terminating their pension plans, if their recovery efforts failed.

“In the event that the companies do not return to profitability in a reasonable time frame, Treasury officials said that they will consider all commercial options for disposing of Treasury’s equity, including forcing the companies into liquidation,” the report said…

G.M. is scheduled to release its financial results for 2009 on Wednesday. Chrysler plans to provide an update on April 21.

Saving the UAW’s pension fund was part of the reason for the automakers bailout in the first place.

Furthermore the healthcare reform legislation includes a discreet injection of $10 billion into the UAW’s pension fund.

Also based on Government decisions by past and current administrations, they drove these car companies into bankruptcy in my opinion. However that is debatable I know.

[FenwickHockey65]

Originally Posted by Supermans

How huge is GM's R&D budget is at this point? Just a few weeks ago, General Motors Pensions were underfunded by $17B.

I can't say anything, but I would pay close attention to launches in the next few years. The basic philosophy at GM now is to spend whatever it takes to put out a world-class product.

[Timberline]

Remember not all news is 100% fact, just because it is printed or reported on the networks doesn't make it the truth. They have a way of telling a story to get the most publicity right or wrong. Every coin has two sides, need to look at all of the facts on both sides.

[StuntmanMike]

Originally Posted by Chief Blackhawk

See post before yours. It was posted 10 minutes earlier. You should of seen it.

"Should of?"

[Supermans]

Originally Posted by FenwickHockey65

I can't say anything, but I would pay close attention to launches in the next few years. The basic philosophy at GM now is to spend whatever it takes to put out a world-class product.

If the philosophy is to spend whatever it takes to put out world class products, I am hoping it is within budget and not sacrificing their employee's pensions and so forth which would make them need more Government infusion of funds later on. As far as the way GM is heading in the R&R dept. I am hoping not all of it is geared toward "green" cars but the muscle car area as well. I do want to see a powerful Z28 now

Originally Posted by Timberline

Remember not all news is 100% fact, just because it is printed or reported on the networks doesn't make it the truth. They have a way of telling a story to get the most publicity right or wrong. Every coin has two sides, need to look at all of the facts on both sides.

Since GM is "We the people" owned, all of the money's being spent and so forth is everyone's business, including what they plan to work on in the future. In other words, GM should not be operating in secret as they did before when they were a private company. (Yes, I know that product launches and so forth need to be kept under wraps for the most impact and so forth..that is not what I am talking about here) I remember a candidate for Presidency once mentioning something about 100% transparency... In other words, if the media is getting the information wrong or twisting it, especially the liberal leaning New York Times, then should we assume they are not being given all the information, or are being given only the information the Government wants them to receive.. Hence back on topic, I believe this story about the loan being paid back is just a way to artificially make it sound as if GM is a couple years ahead of schedule in re-payment and are better than ever. I am hoping GM can continue to do well and in my opinion this propaganda piece was not necessary if GM was doing good enough to meet their original goal to begin with.

[Brokinarrow]

Originally Posted by Supermans

If the philosophy is to spend whatever it takes to put out world class products, I am hoping it is within budget and not sacrificing their employee's pensions and so forth which would make them need more Government infusion of funds later on. As far as the way GM is heading in the R&R dept. I am hoping not all of it is geared toward "green" cars but the muscle car area as well. I do want to see a powerful Z28 now

I'm sure they will keep a happy balance of the two. They've obviously learned that muscle cars still sell with the Camaro, so if there is a demand, they will meet it

[bigearl]

First let me say I don't want GM to fail, and I think they have what it takes to succeed. I also want the whole process to stay above board and honest. The Government has a whole task force on cars now. They own 61% of GM's stock. I understand optimism, but it seems like people weren't paying attention and forget what they don't want to hear:

Originally Posted by a_Username

Then feel free to post evidence of political interference that directly effects the new GM's (as a corporation) business plans.

http://www.washingtonpost.com/wp-dyn...033101521.html

"There will be continuing coordination as decisions about the leadership of the company are made," a White House official said yesterday. "Folks from the autos task force will be involved in those decisions."

"There's a new CEO and new chairman of the board," said Rep. Sander M. Levin (D-Mich.). "The government will play an active role as with Fannie Mae, Freddie Mac and other institutions with a major investment from taxpayers."

http://online.wsj.com/article/SB124834709924575511.html

"The Treasury Department completed its makeover of General Motors Co.'s board, naming five new directors with backgrounds in the telecommunications and private-equity industries."

"The new board is led by former AT&T Chief Ed Whitacre, who was named GM's chairman by the Obama administration in June. The United Auto Workers, which was awarded a board seat after it made major health-care concessions to GM, named former auto analyst and onetime GM adviser Steve Girsky to the board in June."

Then Dr. Cynthia Telles is voted on to the board by the board of GM (as opposed to by the treasury), a UCLA Psychiatry professor and commissioner of Los Angeles County in a move that GM lauded as helping to restore diversity?

"Dr. Telles also serves on the boards of Kaiser Permanente and Americas United Bank, the largest Hispanic-owned bank based in California. President Barack Obama recently appointed Dr. Telles to the White House Commission on Presidential Scholars, a group that selects scholars to be recognized in a variety of fields."

I'm not saying they're bad choices, they seem to be making some good decisions so far. But the administration chose half the board and decided which half of the former board to allow to stay on. Of course they influenced the direction of GM.

[raposak]

They didn't just return the unused money back to the government. They used other borrowed money the government gave them to repay the first loan.

"I think the one thing that a lot of people overlook with this is where they got the money to pay back the loan. And it isn't from earnings. ... It's actually from another pool of TARP money that they've already received," he said Wednesday. "I don't think we should exaggerate it too much. Remember that the source of this money is just other TARP money."

So basically that would be the same as you using your American Express to pay your Visa bill and than saying you are financially responsible.

[hair10]

Eh, I'll have to look around and see what other news sources are saying about it. I don't believe anything foxnews says. The lean so far to the right they need Rush Limbaugh to prop them up so they don't fall over!

[vsound]

Okay, a word about common sense concerning all this talk of a "government takeover"...

This isn't Obama. First of all, it was started under George W., so don't give me that.

GM was simply too large to fail. GM going under would be the equivalent of VW going under in Germany. It is a car company that is tied to the country's history and economic prosperity.

Here is an example of how important GM is:

My father works on a GM lot in our small town. It is the largest contributor to tax dollars in our county. Had GM gone under, and the dealership gone under, it inevitably would have put local government in a crisis.

That includes police officers, schools, etc.

As a county employee, I can already tell you that times are hard enough with GM still afloat.

People don't understand. This is a case of sink or swim. Not commercialism versus socialism.

[Hylton]

Originally Posted by StuntmanMike

That's not really compelling evidence. Is that the best you can do?

http://money.cnn.com/video/fortune/2...goner.fortune/

Just to note, since this interview, the government has replaced the entire Board of Directors and fired Fritz as well. Let me know if you would like more....

[Unfair]

Originally Posted by raposak

They didn't just return the unused money back to the government. They used other borrowed money the government gave them to repay the first loan.

"I think the one thing that a lot of people overlook with this is where they got the money to pay back the loan. And it isn't from earnings. ... It's actually from another pool of TARP money that they've already received," he said Wednesday. "I don't think we should exaggerate it too much. Remember that the source of this money is just other TARP money."

So basically that would be the same as you using your American Express to pay your Visa bill and than saying you are financially responsible.

Which would still leave you in debt with american express...

[wullger]

Cause FNN ALWAYS tells the whole story with no other motives!

<This is my sarcasm face>