Despite massive rebates and interest free loans, the General is in trouble!
 

GM's massive rebates and interest free loans are NOT helping in their bottom line. Both sales and profits are down. They even heavily discount and rebate on their new models. I think they should market fewer products and improve their quality, but it is hard to teach old dog new tricks ;) What do you think the General should do?

There are other sources of GM's problems. Price of steel and rising health costs as well. Along the health costs, GM estimates that they will see a $1B increase in the company's contribution to current and retired employee benefits. I think the projection is that for every employee working at GM, they have to pay for 2 health plans, to cover retirees.

Really, aren't all the automakers in trouble? One way or another?
Benz can't get quality right. The orientals really aren't setting new ground or making breakthroughs, and the Americans are giving the house away.

Their financing business is making all of their profit.
Ditech.com is doing great!

Does anyone else but me see a simularity with the airlines here?

Toyota seems to be making money faster then they can spend it. :D

Look at any GM dealer no one pays sticker for a GM car. Thats why they don't make any money. For example the Cobolt is a nice little car but they are sold cheaper new then Civic's and Corollas. Honda and Toyota can sell their products at sticker.

GM needs a major overhaul. Their fixed 0 interest loans that they made are going to be killing them in another few years, along with a tanking truck market. If you take away trucks what is left for GM to sell? They better start pushing G6's and stop wasting their time making stupid new minivans that don't compete.

GM sells their car to the dealer. The dealer is the one that's hurting when you don't pay sticker. Consumers are not the customer of the big biys, the dealers are. Or so goes Detroit's atitude.

When you get zero percent financing, or massive rebates, or "factory to dealer incentives" passed on to the customer, those are offered by the factory, not the dealer, and cut straight into GM's margin. The dealer is discounting too, but the biggest pain is GM's.

You've hit the real issue, aside from consumer apathy/distaste caused by a couple of decades of mediocre product. The cars are much better now, but most consumers aren't willing to give the domestics the benefit of the doubt.

Wall Street analysts have pointed out for years that GM, in particular, is run for the benefit of its retirees, not for the shareholders - that's where the majority of free cashflow goes. That's the laugh on the anti-capitalist lefties, the UAW has shrewdly gotten millions of shareholders to finance dozens of expensive factories so that the big 3 can pay their retirees much more than their earnings (i.e. what the shareholders get out of the deal). The Japanese and Germans have gov't health care and retirement, unlike the US (SocSec doesnt' really count, at least not to the UAW). The Japanese have to offer similar benefits to workers in their US plants, but those plants were all opened (with young workers) in the last 10-15 years. The big three are supporting generations of retirees' pensions and health care costs that the domestic Japanese/German factories won't have to deal with for decades, and their home plants in Japan/Germany don't deal with at all.

I don't have the exact number in front of me, but I recently read that the big 3 have a $1000-2000 cost per car to cover retirees pensions and health care that their competitors don't face. Even if they could sell the same cars for the same price, the domestics would be getting whacked by health care and retirement costs. That's why the big three all heavily supported Hilary Clinton's nationalized health care plan - they'd love to shift the retiree health care burden on to the taxpayers, in the same way that most of the steel industry went bankrupt and re-emerged much more competitive, having shifted its retiree costs to the taxpayers via the PBGC. If GM really does go bankrupt, that'll be the reason - it will get the shareholders in the post-bankruptcy Newco off the hook for health care and pensions for hundreds of thousands of UAW retirees, and allow the new GM to compete on a more level playing field.

A good example of Hillary Clintons communist health care system she wants us to emmulate.... WWW.THEREALCUBA.COM yeah cuba has free universal health care....wanna see what it is...look through that site....do you want the saem thing here?

Can't raise prices because the average person won't buy a new vehicle if they do???

Price of raw materials is climbing steadily and there is no way to buy the raw material cheaper due to worldwide demand???

Significant labor required in the business. Most labor is highly paid and has many benefits???

Don't want to cutback production because an idle factory is worse than selling the vehicles at breakeven???

Massive advertising expenses???

Stiff competition from other manufacturers who have lower labor costs and build vehicles overseas???

See any similarity there?? ;)

The one significant difference is that the airlines are now marketing a stripped down Yugo while the auto manufacturers continue to enhance the vehicles with enough gadgets and computers to launch one of the damn things to the moon. A direct contradiction to the airline business.

All the smart designers and big shots must have moved to Ford and Chrysler, because GM is for sure into a tail spin. The only vehical I care about these days is the Corvette. The Hi=performance GTO looks like something from Japan, it aint working people.. :mad:

The new GTO is the direction GM needs to go in. If they could improve the style a bit it might start to eat into G35 and 330CI sales.

Mrs. (or is it Ms. Clinton now? :D ) should be trying to emmulate Canadas health care system. While far from perfect, the level of care is excellent from my experiences, chaulk up any stories to the contrary as typical media (lets get some ratings!) propaganda.

This may explain why General Motors has recently announced a $2.5 billion dollar investment into the province of Ontario (we assemble more cars than Michigan now). When you have many healthcare costs (save dental and drug plans) out of the way, you can concentrate on building the best possible products. The former Buick Regal, highest ranked J.D. Power General Motors Product was produced here.

You Americans who are against national health care puzzle me. What happens if your "piss on YOU......as long as I'M okay...." mentality backfires in your face and you end up the product of a bad luck or tough circumstances, unable to afford your private insurance? What then?

Call me socialist if you like, but what is wrong with paying a little more in taxes to help your fellow brother, your fellow man? Maybe I've been listening to too much Sam Roberts :D


S.....O...CIA......LISM is the only waaaay.........hey hey !!! :D

With the health care rant over, I'd like to say that the new crop of General Motors products is looking up. Hell, for an honest sedan devoid of sporting pretensions, you can't really beat the Chevrolet Malibu V6. Why bother paying extra for an Altima or Camry or Accord? The build materials/quality are little different between them. People today though seem willing to spend more for the name of quality ..... mainly just perceived since the build materials gap has been closed. A halo around a name sure can pay dividends.

Is it just me, or is every Toyota Camry driven by a 78 year old white male?

Toyota has become Chevrolets Buick. Anyone with a pulse knows better. :D

I thought the Malibu was a very good car, and was looking into a late 90's one for a winter beater. Then I read reviews about them on Carreview.com. Holly crap trans, head gaskets, injectors, the list goes on and on after reading that site I won't touch one. I'd be better off with another MB.