Tag: GM

Will GM Survive?

By now everyone who can read or hear should know the GM is going into bankruptcy and will get more funds while doing so.  They, GM, has already got an ad saying that they are just reinventing themselves not disappearing.  That some models will go and some will stay and theat allk is geared to the survival of GM and its future.

Recently I hears CNBC’s “Krazy” Kramer say that the whole thing for GM was nothing more than a massive jobs thing.  And that they would save some jobs, but would not survive too much longer.

Think about what he has said…..I believe he may be right in his assessment.  Basically, all this is doing is saving the jobs of as many workers as possible, because if not the drain on the economy and programs of Michugan would be astronomical.  They are just prolinging the inevitable as long as possible with the hopes that the country’s economy will rebound and better absorb the losses.

Edward Altman of the New York University Stern School Of Business said:

“The bill is now up to $50 billion or more, which is what we said would be needed, but the government should be first in line,” Altman said today on Bloomberg Television. “The government will now have stock in the company, more than 72 percent. It is a big uncertainty if the company will do well. The potential biggest loser, unfortunately, is the U.S. taxpayer.”

Kramer may not be as “Krazy” as he appears.

Are The Workers Getting Shafted?

The answer to this question is becoming evident and between UAW and GM, the workers continue to suffer the ravages of the economic situation in the country.

In an email sent to members at GM, the UAW said it was “expecting the restructuring negotiations to intensify this coming week,” adding that the UAW was “actively involved in these complex negotiations, which involve the Obama auto task force, GM management, bondholders and secured lenders, dealers, parts suppliers and other stakeholders.” The UAW message continued, “These negotiations will have a major impact on wages, benefits and jobs for active and retired UAW members.”

In a piece written by Jerry White he points out several ways that the UAW is assisting GM in the destruction of employment in the auto giant.

The UAW is reportedly close to a deal to slash the wages and benefits of its 62,400 members at General Motors and reduce labor costs by $1 billion. In addition, it would allow GM to forego a $10 billion payment into the UAW-controlled retiree health care trust fund, a move that would gut benefits for more than half a million GM retirees and their dependents.

The concessions are expected to match or surpass what the UAW agreed to last month at Chrysler. That deal eliminated cost-of-living allowances and production bonuses, stripped workers of break time and holidays, gutted supplemental unemployment benefits and gave up the right to strike until 2015. In addition, the UAW agreed to further takeaways for retirees, including the elimination of vision and dental care and the imposition of higher co-pays for prescriptions and doctor visits.

Also the UAW, according to the Detroit Free Press,

The union urged members to call the White House and lobby for GM to be required “to maintain the maximum number of jobs in the U.S.”

Is the UAW working diligently with GM to destroy jobs or are they truly working for the benefit of all its members?  To me, it looks like the UAW is in bed with management and then tries to make it like it is all up to the member to stop the changes…..Will Gettlefinger, or whatever his name is, also to the same pay cut that he is forcing the members to take?

Union members are screwed and with the help of the Union……

More Trouble Brewing For GM

General Motors Corp’s bondholders are preparing legal arguments against the automaker’s bankruptcy plan, the Wall Street Journal reported on Sunday, citing people familiar with the matter.

A plan to split the corporation into a “new” company made up of the most successful units, and an “old” one of its less-profitable units, is seen as the most sensible configuration, a source familiar with GM’s plans told Reuters last week.

The Journal said bondholders are worried that the process will push them to accept hefty losses on their investments. It said members of an ad hoc committee representing GM bondholders have made their concerns known to the Obama administration’s task force.

In a separate action, GM faces a lawsuit in Canada from unsecured bondholders over dividends GM paid from a Nova Scotia unit last May to its U.S. operations.

The bondholders claim the company wrongfully pulled around $600 million from the Canadian subsidiary because company officials should have known the U.S. business was near insolvency, according to the Journal.

GM has said in court filings that the allegations are false and that it was acting within its rights, the report said.

The U.S. Treasury Department is directing General Motors to lay the groundwork for a bankruptcy filing by June 1, even though the automaker has publicly stated it could reorganize outside of court, The New York Times reported on Sunday.

Looks like GM will be the poster child of the week in the news, huh?

It Is All Labor’s Fault!

How about a small reality check?

GM is sucking hind tit, Chrysler is whining and selling off assets, Ford has hit bottom and now I hear from various circles that it is labor’s fault that the auto industry is crashing. The Unions and the workers negotiated and got higher pay, better benefits, etc. Afterwards, the companies whined that they could not afford the increases. Now that the slowdown has hit the industry it is costing jobs and such. Now all the gains that labor has made in the past has come back to bite them in the butt and makes them the obvious scapegoat for the industry’s problems.

First of all, let me lead with this statement—What a crock of crap! The auto industry is crapping out because of the decisions made by management, not the workers. These CEOs, COOs, CFOs, all knew what was happening in the economy and what trends were on the horizon. The workers did not design the cars or make the decision on what models were to be produced. The workers did not decide what bad investments to make.

Management teams were chosen on the promises of an increase of dividends to investors. In return these teams made millions even if they put the company in a bad light. If these teams were caught flat footed by the situation, then I say that they are not worth the millions they are receiving as compensation. Workers did not make these horrible decisions. The workers did not set out to destroy the auto industry.

Please stop blaming labor for the auto industry putting itself into the crapper. To blame labor and unions for any of the economic woes of the auto industry in this country is just plain—let me spell it out for you—S-T-U-P-I-D!

GM Tries To Save Its Butt

Chairman and CEO G. Richard Wagoner Jr. said GM will save or raise about $15 billion in cash with a slew of moves. GM plans to slash salaried worker costs by 20% by cutting jobs and retiree health-care benefits. The company’s U.S. salaried workforce is 32,000. GM also says it will cut marketing and advertising budgets and capital expenditures. Beyond that, GM also will sell more assets, perhaps even an equity stake in its profitable overseas operations. “We’re going to have to ride it out until market conditions settle down,” Wagoner told reporters.

Whether Wagoner’s latest moves will be enough is an open question. GM is assuming American consumers will buy 14 million cars a year, down from 16.1 million last year, and that its market share will be around 21%. Last month, industry sales slowed to a 14-million-vehicle annual selling rate and GM’s market share was 21%. GM will have to hold its market share to keep its turnaround plan from losing steam.

But as usual, their butt is worth more than the people that made them an Auto giant.

GM’s Woes Continue

General Motors Corp. may turn to salaried job cuts, as well as more extreme measures such as shelving a brand or borrowing from the UAW, to stanch North American losses in this year’s sinking auto industry, according to reports. The company isn’t commenting.

After falling to a half-century low last week, GM shares jumped Monday morning on a Wall Street Journal report about the possibility of job cuts and brand sales. But the shares fell back to a modest gain when spokespeople declined to comment on the job cuts and denied that any brand other than Hummer was under strategic review.

GM Chairman and CEO Rick Wagoner announced June 3 that the company is considering “all options” for the brand.

But GM has many options.

The automaker may be able to raise $5 billion to $6 billion from banks and another $6 billion by persuading the UAW to let it borrow some money pledged to a retiree health care fund, Brian Johnson, a New York-based Lehman Brothers Inc. analyst, said Monday.

NOW, that last statement is the one I zeroed in on…the Corporation will go to the Union, it has spent so much time trying to destroy, and ask for money, a loan.  Here is the chance to get even.  But will they?

GM’s Financial Woes

“As goes Chevy, so goes America”, an old saying that I do hope is not true.

General Motors Corp. stock closed below $10 per share Wednesday — its lowest level since Dwight Eisenhower was president, power brakes were new and the Bel Air was the automaker’s hot new car — after dreadful June auto sales led one analyst to write that “bankruptcy is not impossible.”

Even if GM management feels it doesn’t need to borrow the money, doing so probably would ease investor anxiety.

Although bankruptcy could make it easier for GM to shrink its brand and dealer network to the size it truly needs in North America, “for a consumer-product company, it’s a fearful prospect to contemplate because of consumer perceptions,” Phillippi said.

A Chapter 11 bankruptcy reorganization might help GM become more competitive, he said, but it would have to worry that customers would stop buying its products for fear parts and service wouldn’t be available or that the company wouldn’t survive.

“We believe that the weakness in demand and deteriorating mix through the first half of 2008 are just the beginning of what is shaping up to be a more severe downturn than even the most bearish industry observers expected,” Murphy wrote. “In the wake of a deteriorating economy, a weakening consumer and rising gas prices, we expect industry volumes to decline significantly.

GM Sues Canadian Auto Workers

This is a scary thing to me…….the automaker suing a union over a blockade of a plant.

General Motors of Canada is seeking C$1.5 million ($1.47 million ) in damages from the Canadian Auto Workers union and is seeking an injunction against the union’s blockade of the company’s Oshawa, Ontario, headquarters, court documents showed.

The union’s blockade has prevented anyone from entering the headquarters for eight days now. Union members set up the blockade after GM announced last week it would close its Oshawa truck plant in September 2009, with up to 2,600 workers losing their jobs.

The company and the union signed a new contract agreement just two weeks before the GM announcement. In the contract, GM said it would keep the plant open until 2011.

But the company said a sudden and drastic shift by U.S. consumers away from gas-thirsty trucks and sport utility vehicles is forcing it to close the truck plant, along with two others in United States and one in Mexico.

Canadian Auto Workers Think Strike

Canadian Auto Workers President Buzz Hargrove said the union is considering all options of protest including a strike after General Motors Corp.’s top leadership failed to give any hope that the automaker would keep the Oshawa, Ont., truck assembly plant open.

Hargrove said the CAW will decide how to proceed following its convention next week. Among the options, he said, would be taking the issue to the Canadian labor board, taking GM to court, pursuing expedited arbitration or even a strike.

CAW Local 222 leaders, who represent the Oshawa truck plant slated to close in 2009, said the blockade of GM’s Canadian headquarters in Oshawa that began Wednesday would continue for now.

The CAW signed a new contract with GM just two weeks ago and says GM had committed to keeping the plant open and appointing it with future new product.

The contract language said the company intended to allocate next-generation trucks to Oshawa, “dependent upon market demand and in light of the increasingly uncertain North American truck market.”

CAW members said the market has not changed so drastically in two weeks that GM could have entered into its contract in good faith.

“They’ve fractured our relationship,” said Local 222 President Chris Buckley. “There is no trust.”

GM Workers Anticipate Layoffs

Workers and Wall Street were anxiously awaiting the news out of General Motors Corp.’s annual meeting this morning, with expectations that the beleaguered automaker will announce more restructuring measures that could further reduce the number of jobs and even idle factories in an attempt to improve its sales and financial results.

For workers at GM’s truck plants, that has meant wondering whether there would still be jobs to report to following the next round of change.

In its announcement today, the automaker is expected to give those plans more clarity by announcing plans to increase the production of small and midsize cars at its assembly plants in Orion Township and Lordstown, Ohio, even as it takes steps to further reduce production at some GM truck plants.

Workers at Orion Township and Lordstown are hoping for increased car production, added shifts and the promise of new models.

Analysts and economists have said they wouldn’t be surprised to see cuts at a Michigan plant — in Flint or Pontiac — or those in Janesville, Wis., or Moraine, Ohio.

GM is not commenting on the planned announcements, though spokesman Tom Wilkinson has said that the company has no big salaried layoffs in the works.