Will restructuring mean lower MSRP?

[Rob53]

As GM cuts costs to meet the demands on the bridge loan, that should translate into lower production costs. Shouldn't the savings be reflected in the price the consumer pays?
:flag2:

[Scott@Bjorn3D]

Nope. Means hopefully now they will start making money on cars sold instead of lossing 1000-2000 on every car coming off the line.

[trm0002]

Originally Posted by Scott@Bjorn3D

Nope. Means hopefully now they will start making money on cars sold instead of lossing 1000-2000 on every car coming off the line.

Not necessarily. The OP may be onto something just looking at it in the wrong way.

1st and foremost these companies need to sell cars (raise cash) to get them out from under. The Big3 "problem" isn't the main reason people aren't buying cars; if it was, Toyota wouldn't be offering 0% financing and massive rebates also. The general state of the economy, lending in particular, is the big reason sales have tanked- on ALL brands.

It wouldn't surprise me in the least if GM had a fire sale to jump start sales. It could be as simple as 5% off every vehicle in the GM lineup during the 1st quarter of 09. As part of the restructuring, the dealers know they'll have to give up something too. 2-1/2% from GM, 2-1/2% from the dealers; both still make some profit and we get a break in the end. It's not out of the realm of possibility...

[Scott@Bjorn3D]

Sales would help that is for sure. But they really have to many different cars and trucks. That is what is killing them. They have to bite the bullett and make less models and kill off some brands to survive.

[Supermans]

They have to lower msrp once the legacy costs are lowered.. It would benefit all of us including sales increases and being more competitive with foreign automakers.. We the taxpayers are paying for this bailout aren't we?? Our taxes will go up as a result and why do we have to pay extra for a fee that is no longer there..?

[Max]

I don't know how it's going to work,because people got to have jobs to buy cars.This money they will receive will just keep there head above water. it's not going to do a thing for you and i. Folks are'nt buying cars thats way they are in this mess.browing from peter to pay paul it's just an evil cycle.We live in a country that has always found way to work thing out,it's just going to take time.

[UCF w00t]

Originally Posted by Supermans

We the taxpayers are paying for this bailout aren't we?? Our taxes will go up as a result and why do we have to pay extra for a fee that is no longer there..?

Sort of and no. Yes, the fed government (which represents taxpayers) is paying for the bailout. But no,we will not be paying for this through higher taxes. We are in a theoretical territory here that noone fully understands but basically our government is just making the money of of thin air. Will the fed ever pay off the "debt"? Probably not. Is that a problem? Probably not. The US dollar has strengthened in the face of a faltering economy and a massive increase in federal debt. It really doesn't make sense but you can't equate higher federal expenditures to higher taxes. A balanced budget? Who needs one of them!!!

[BryGo]

I think first and foremost the credit markets have to open up. Nobody is lending money. Chrysler Financial stopped doing leases several months ago; GMAC is near announcing the same. In order to qualify for GMAC financing, you need to have a 720-740 credit score. The other banks, sure, they loan you money, 20% down and 7% or higher interest. In talking to my neighbor who is a sales manager at the dealer I am buying my Camaro, he said that almost all Chevys are pushing out the door with an 8% interest loan. Sure, the are SOME 0% deals out there for either short terms, or in some cases long terms on cars they simply cant get rid of (like the Tahoe, dont know why, I love my Tahoe.)

The bottom line is the banks have to stop hoarding the money, and THEN the Big 3 need to impose some discounts. The sales then, would surely skyrocket.

[Supermans]

Originally Posted by UCF w00t

Sort of and no. Yes, the fed government (which represents taxpayers) is paying for the bailout. But no,we will not be paying for this through higher taxes. We are in a theoretical territory here that noone fully understands but basically our government is just making the money of of thin air. Will the fed ever pay off the "debt"? Probably not. Is that a problem? Probably not. The US dollar has strengthened in the face of a faltering economy and a massive increase in federal debt. It really doesn't make sense but you can't equate higher federal expenditures to higher taxes. A balanced budget? Who needs one of them!!!

How can you say the dollar has strengthened??? How is printing mroe money which causes a more rapid inflation going to help out the dollar's value???
My argument is that legacy costs which add that extra $4,000 to the actual production value of each car no matter what the price is going to have to go down once the union's give in so GM and Chrysler can receive the bailout which is our money "the taxpayers".. For some reason a lot of people don't really understand the Capitalist system and seem to separate what the Government does in relation to what they earn and what gets taken away in taxes each year. Remember I'm talking about all kinds of tax here..

Dollar in new spiral...

http://www.bloomberg.com/apps/news?p...d=a1MsoPDHjFS4

The U.S. currency slid to a 13-year low against the yen today and had its biggest one-day decline versus the euro after the Federal Reserve reduced its target interest rate yesterday to a range of zero to 0.25 percent, the lowest among the world’s biggest economies. CMC Markets said today the currency’s prospects appear “ominous.” State Street Global markets said the dollar’s outlook has been “undermined.”

[Crowley]

Originally Posted by Scott@Bjorn3D

Sales would help that is for sure. But they really have to many different cars and trucks. That is what is killing them. They have to bite the bullett and make less models and kill off some brands to survive.

Bingo ..

Crowley

[UCF w00t]

Well as compared to the Euro, GBP, AUD, and CAD, at least. This summer, it was around $1.6 per euro. Now it's $1.38 (up 6 cents from only 2 days ago). The Yen is back at 89.36y/$1 today. The CAD was worth more than the USD at one point. The dollar is at it's strongest against the GBP since at least 2003.

A one-day decline is meaningless in this kind of economic climate of fear and panic. You have to look at longer trends. The markets in general have been shooting up and down at levels never seen before. The dollar is stronger against several other benchmark currencies than it has been in quite a while. The article you linked is more of a sign of a strong yen than a week dollar. Also, the dollar took a hit that day due to a surprising rate cut from the fed. It has since rebounded across the board. The market tends to freak out when they get surprised but now that it's all settled in, they realized it's not so bad after all.

In the end, a dollar is worth whatever you can get for it. Just because our government takes out a chunk more of debt against themselves, doesn't really matter much. The dollar isn't going anywhere.

[djsnoflake]

They have to bite the bullett and make less models and kill off some brands to survive.

Cough, cough, Buick

[fastball]

This market is great for us Camaro buyers. It should keep the markups down or completely eliminate them. Plus, I can use the old "well, I don't know if GM is going to be around in a year so if I can't get 3500 off sticker I think I'm just going across the street to the Honda dealer to buy my car" game plan if the dealer gives me a hard time on price

[AZCamaroFan]

Originally Posted by Rob53

As GM cuts costs to meet the demands on the bridge loan, that should translate into lower production costs. Shouldn't the savings be reflected in the price the consumer pays?
:flag2:

you'be gotta be kidding.