GM Exec says Next 100 Days "critical"

money.cnn.com...

"A top General Motors Corp. (GM) executive on Wednesday said the next 100 days could represent the most crucial time in the history of the troubled company and entire U.S. auto industry."

Don't worry. World President Obama is here to save the world.

World leaders, normally diplomatic in their official statements, were unusually effusive in their praise for President-elect Barack Obama.

The President of France has all but annointed Obama as the savior of GM, Ford, Capitalism etc. etc. etc.

After WW Two, it became evident that the Big 3 not only helped the victory effort but it was also the bedrock, economic engine that ran the US economy.

Think of all the parts manufacturers, the dealerships, the small garages, the many, many subindustries that rely on the US auto trade.

This is a huge blow to our economy, and if GM fails, it may represent the end of America as we know it.

Having Bud being owned by Europeans may be a hint of the future.

I'm not sure anything beyond absolute devine intervention can save the automotive industry in its current incarnation.

The cost structure of the production of vehicles is such that there needs to be a systemic reconstruction that puts costs more in line with what is affordable and in a manner that keeps maintains employment.

Unfortunately, that is an elusive target and has been for a number of years to the point that the automotive sector has become cannibalistic.

It is a daily concern of suppliers that their work is being 'shopped' and moved to the lowest bidder regardless of the quality of product or the point of origin.

General Motors is the worst in this regard. Each year they extort 'givebacks' from their supply base which if not paid effectively results in that supplier being red flagged as uncooperative and listed for 'rationalization'.

The work is then shopped and summarily moved to a supplier who will accept the price GM is requesting.

They have and entire bureacracy set up within GM to do this . . . their Business Transfer Authorization Board (BTAB) has the sole mandate of moving work to the cheapest source.

So they work tirelessly at sending work off shore yet continue to lobby hard the government for more money to be able to continue their quest. In effect, they want taxpayer dollars to use to 'fix' the mess by outsourcing jobs to Mexico, China, India and the like.

Nice, isn't it.

But, failure to do anything about it will result in economic carnage not yet seen . . . industry analysts suggest that job losses could top 2.5 million in the next few years if nothing is done to fix this mess.

I struggle to see how it can be fixed before it collapses.

I quess, no matter what will happen in next 100 days, is this:

1. Research and development for future car manufacturing will be stopped immediately.

- Jobcuts, funding cuts, research cuts, education stops.

2. Only cars witch are already ordered, will be produced.

- Many factory will be closed, dealers wont get new products

3. Sponsor deals will be cancelled to coming years

- Sports, culture, literature, university...

Even if they get some package of aid, this will happen, because its all about money and profits. Corporation will be cutted to pieces, and its parts will be sold to other manufaturers, like chinese and japanese, maybe some new US bankers coalition still takes some parts of business, over taking patents and legal rights.

Government will take some of GM weapon industry, but then... GM will get it self to ready and sold out, to the one who are ready to pay most. And that means more cuts, and driving down the corporation.

GM is a giant of the past, Dinosaurus, and its time has come long before this new economical storm and recession. Its in deep trouble first, because it was already troubled before the financial crisis starts.

This all doesnt mean anything bad to GM:s stocks! Profits will be earned, stocks can go many times higher before than today, when everything is sucked out from this giants chest. With, or without any aid packages.

Cuts means always higher profits and outcomes to Elite, witch come on different kind of bonus and option programs, to the owners and member of company leadership... Those who will suffer most, are those people who earns their living in that corporation giant today, and of course areas, where that giant is placed today.

[edit on 6-11-2008 by JanusFIN]

Just on CNBC......at about 8:37 Saskatchewan time.

Quote "GM to announce suspension of product development for many future models...."

What does this mean?

They plan on to continue buisness but with far fewer models??

Do they plan on selling parts of the business and makeing GM very small?

Originally posted by whiteraven
Just on CNBC......at about 8:37 Saskatchewan time.

Quote "GM to announce suspension of product development for many future models...."

What does this mean?

They plan on to continue buisness but with far fewer models??

Do they plan on selling parts of the business and makeing GM very small?

If I had to guess it would mean that after they merge with Chrysler they are going to dramatically reduce the number of models offered.

Just guessing.

JK

Expect some more bailout with our tax dollars to save these guys tomorrow.

I'm tired of bailing out all these companies..ya it could affect a lot of jobs, but ya know free trade is pretty inventive and maybe this would be a good chance for other people with better ideas on how to build better cars to move ahead.