GM Big financial news today.

Need4Speed

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Just some of the story ON BLOOMBERG.

General Motors Debt Rating Cut to Junk by Standard & Poor's Page 1/2

May 5 (Bloomberg) -- General Motors Corp., the world's
biggest carmaker, had its debt rating cut to junk by Standard &
Poor's, after the company reported its worst quarterly loss in 13
years.
GM had been lowered three times by the ratings company since
2001. GM, with about $300 billion in notes, bonds, loans and
asset-backed securities as of Dec. 31, is the biggest company
ever cut to junk. The former biggest so-called fallen angel was
WorldCom Inc., which had $30 billion of bonds cut to speculative
grade on May 10, 2002.
 

PDCjonny

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Can't wait to see what the new Z06 MSRP comes in at. With dealer gouging it will be 75-80K or more after taxes. That will keep them sitting on the lot.
 

95Viper

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They won't sit on the lot unless they build 20K of them a year...dealers will just gouge a little less.
 

AJ

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unions

also, on a side note, i thought toyota's desire a few days ago to raise prices "to help gm sell more vehicles" was quite revealing.

alex
few cars
 

JWVIPER

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Pontiac and Buick divisions are in huge trouble....

most analysts say those two are as good as dead, I had to rent a buick the other day for business travel. Got to be the most unappealing car I have ever driven, appearance, look, feel etc .........uuuuughh
 

Vic

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Buy American, before its too late. This is our country, lets support it. :usa:
 

monnieh

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I've never bought a anything but American cars my whole life.

But my next car will most likely not be American. My friends car's quality is so much higher than any of mine it is just sad. And then when I heard $2,000.00 of the cost of a GM car is for healthcare for the retired union workers, well that just was too much for me.
 

JWVIPER

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Buy American, before its too late. This is our country, lets support it. :usa:

All for that but they have got to put a product out that the consumer wants !

When i was a kid I knew people that owned buicks, today I can't think of a single person I know that owns one or would want to own one.
 
OP
OP
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Need4Speed

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Looks like GM will be getting some help from Toyota:

TOKYO (Dow Jones)--Toyota Motor Corp. (7203.TO) on Friday declined to comment on a report that top executives from the Japanese auto maker and General Motors Corp. (GM) will meet later this month.

-The Nihon Keizai Shimbun reported Thursday that GM Chairman Richard Wagoner will meet Toyota President Fujio Cho when he visits Japan later this month. It is believed they will discuss ways that Toyota can help GM in areas such as safety and environmental technologies, the paper said. GM's vice president and head of R&D, Lawrence Burns, is also likely to attend the meeting, the report said.
The report comes after Toyota Chairman Hiroshi Okuda last week expressed concern about the hard times U.S. auto makers are facing.
Citing ineffective management strategies, Standard & Poor's on Thursday downgraded GM and Ford Motor Co. (F) to junk status with a negative outlook.
Japanese car makers have enjoyed increases in U.S. sales and market share, and Okuda's comment is a clear indication that Japan's auto industry wants to avoid a situation in which trade tensions could be rekindled amid U.S. rivals' misfortunes.
 

Bonkers

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Finicially the big 2.5 are fighting a losing battle. To fully complete with imports they would have to pay foriegn wages AND completely dissolve heathcare and 401Ks a position no American worker is willing to accept - even the illegal ones get benefits these days.

Add to that the Walmart Mentality of Y2K - everything cheaper! cheaper! cheaper! and all American companies will suffer greatly before people either wake up and realize they're blue lighting themselves unemployeed or dig the economy into the ground.

At least that's my view...
 

AviP

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Buy American, before its too late. This is our country, lets support it. :usa:
Oh yeah, I'm heading out right now to make a 20000+ capital expense because it's American. Get real, it's a global economy and that means I, the consumer, buy what I like and can afford. If GM can't compete, then they will be bought over. Chevy, GMC and Pontiac will probably live on. Buick should die.
 

Vic

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Get real, huh? I am getting real, and I'm voting for my country with my dollars. You can hasten the demise if you want, but I will support my country until the end. I've always admired German cars, and some English cars, but I don't buy them, because of my loyalty to American iron.

Avi, if we Americans don't support our own country, there won't be any cars made here anymore. Do you want to see that happen? Were you born here? I was, and I will always love my country and its institutions.

I'm not buying any Buick, but a ZO6, or Ford GT is a good bet.
 

JKVIPER

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We are becoming a sales, distribution, and healthcare economy. There is less value in manufacturing since it can be done very cheap in other countries.

In order to survive, GM and Ford will have to innovate, market, and service their customers better than their competition. The reason why they are struggling is in many cases their products are not as good or desirable.

It's pretty sad that BMW, Honda and Toyota both assemble cars in the US and they are very successful.

In the past 20 years I've owned 9 cars. 1 Ford and 1 GMC were garbage, 1 other Ford was kind of unreliable, 5 Chevy's(4 vettes) and 1 pontiac were very good, 1 Dodge is very cool if you know what I mean, and 1 Lexus which is the best(most reliable, best quality after 130K miles).

Now when my Lexus hits 200K miles and I'm ready for a new car do a I buy a new Cadillac STS for 50 grand when my last $40K GMC fell apart in 4 years of ownership or another Lexus? That is what it is all about.
 

Vic

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There isn't anything that can't be made cheaper in China. They are making cars over there, and Daimler Chrysler is planning on importing them to the US. If I were GM, I'd tell the UAW they will have to make adjustments to keep their jobs. I'd also levy tarrifs on Chinese goods until they stop using slave labor, prison labor, children and the elderly, and enact some environmental laws, and let their artificially depressed currency float in the Forex markets.

GATT and NAFTA were passed during lame duck sessions of Congress, when only those with vested interests showed up to vote, without a public debate, or any opposition. A communist Chinese national by the name of John Huang bribed the Clintons to get China designated "most favored nation" trade status. (Whats the penalty for treason? Hanging.) Ross Perot was right about the "giant sucking sound" of jobs leaving the country. Those at the helm aren't patriots, they are international bankers and industrialists, or puppets of the same, who don't love their own country more than they love money. Politicians who accept bribes from foreigners are guilty of treason. Some politicians and citicens are ignorant and just along for the ride, and don't realize they are selling their country down the river.
 

Tiepilot

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Vic would you stop posting and get back on your meds. Your posts ramble off into conspiracy nut-land when you are off of them.

An American daily driver car is good for what 40K miles?
And then the prudent person has to dump it due to unreliability and cheap crap materials? Yes.

Until the US car makers learn from the Japanese how to build a quality car with quality materials they will suffer market loss.

Deal with the problem; UNIONS. Union labor costs quality and it shows in the cars made by the not so big three.
 

Vic

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What have I said about any conspiracy? John Huang's bribes were in the national news, which is hardly "covert" activity.
 

VIPER GTSR 91

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Vic would you stop posting and get back on your meds. Your posts ramble off into conspiracy nut-land when you are off of them.

An American daily driver car is good for what 40K miles?
And then the prudent person has to dump it due to unreliability and cheap crap materials? Yes.

Until the US car makers learn from the Japanese how to build a quality car with quality materials they will suffer market loss.

Deal with the problem; UNIONS. Union labor costs quality and it shows in the cars made by the not so big three.
You are SO correct TiePilot, and the biggest percentage of cost by far for a US car is for labor. The Japanese take a lot of pride in their work and it shows. I will buy another SONY tv too before a GE.
 

Got Venom

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I think a major malfunction of this bulletin board, is that when a heated patriotic topic comes up, respondents are not required to state their line of work or how long they have been in or plan to be in this country. It really would help all of us understand where each person is coming from. I own a Manufacturing company, and was born in this country, and plan on staying here. I know it does not do a lot of good to complain, but it does seem as though we are all headed to a much lower position globally, if we do not start thinking of our own greed, and not of our country's survival. What happened to all of those people who used to boycott NIKE for using slave labor etc. What about shopping at Wal-Mart. Do all of the people who manufactured those goods get a decent living wage and a 401k or any retirement package? How about good healthcare and workerscomp, and dental care, and good EPA environment regulations to protect their lungs? What about lawyers to help them sue their employers an win the lottery? Of course not, but the big three auto makers are stuck doing just that. How can they offer a competitve product, with all of the costs associated with retirement , healthcare, litigation, insurance etc. How would you suggest they eliminate these costs? Pleas specify what you do for a living, so we know where you are coming from. Oh, and for the record, even though I do own a bunch of American cars, I did just buy my wife a Mercedes. But I still will never shop at a Wal-Mart.
 

Vic

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I am an elevator construction and service contractor, our family has been in the USA before there even was a USA, coming from England in 1640.

Our business has several trucks, and the Fords have been very, very good, which surprised me, since there a time when I swore I would never buy another Ford. I think Ford has made some great strides in their quality. One of our trucks is a GMC, and honestly, it doesn't seem very well made. The exhaust rattles, and the wipers don't even flip up. Seems behind the times, sad. My wife had two Cadillacs, but her last one was so awful, she got a Lexus. I know American cars have problems, quality needs to continue to improve, but I still "root for the home team", even if they are behind. Thats one reason I liked the Viper so much when it came out, it represented a rennaisance of sorts, in the American car industry. I don't dislike foreign cars, in fact I respect a lot of them, and I have no illusions about American cars, all I was trying to do was stir some patriotism.

I hope Americans can continue to enjoy a high standard of living. But it is clear that the economics of industry is shifting towards the third world. The US will be left a hollowed out, service based economy. It is a sad development, and comes not only from the failure of American car manufacturers and unions to change with the times, but also from the effects of NAFTA and GATT. Another example is the US steel industry. The quality of the steel was not the issue, it was the lower labor costs of foreign steel, dumped on US shores, that led to the demise of the US mills. Even if America produces a quality product, but can't compete on price, we are doomed. Manufacturing gravitates towards the cheapest labor.

A nation must produce something, and sell it to other nations, to stay strong. With a multi-billion (and growing) trade imbalance, the wealth of this country is slowly leaving. If we don't produce something, we cannot support a large military structure forever. Without the ability to wage war, we are left weak, and the American era of world dominance is over. Chrysler has been bought out, Ford and GM are now reduced to selling "junk bonds", where is this all going?

Looking back through history, the nation of Spain had some similar parallels to our own history. At the peak of Spain's power, they controlled the seas (and thusly commerce) with their impressive Spanish Armada. Spanish galleons were laden with gold, the victor collecting the spoils of their global trade dominance. Soon the Spanish nation was flush with wealth, and began to export their menial labor jobs of leather, glass blowing, brass works, etc. They became a net importer of goods, rather than an exporter. After a while, Spain did not generate enough cash flow to support their huge fleet. The English clipper ships (adaptive!) were also a factor, of course, turning on a dime, coming around with cannons blazing, ripping the slow lumbering Spanish galleons to shreds. Without their sea power, Spain faded from the scene, and was a world power no more. What is to keep the USA from going the same route? NAFTA and GATT serve to hasten the demise of the American era. And granting the communist nation of China "most favored nation" trade status was an egregious error.
 

Camfab

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Vic thank you, you took the words out of my mouth. I unlike the majority of you am a union worker. I have been on both sides of the fence, I was a general contractor prior to my current position. I buy American products whenever I can, regardless of cost differential. I put my money where my mouth is period. From what I'm understanding some of you feel that workers, particularly union workers should not receive health care benefits after retirement. The most important point in ones life to be covered by healthcare. This way they can lose their homes and assets to stay alive right? Increasing the burden on our already failing healthcare sytem. You guys are the same whiners trying to save another nickel on a group buy of made in CHINA lifts, right! By the way many of those japanese cars are made with American Union labor.

Let me make something clear, I'm not saying their isn't a problem with American manufacturing and with labor. The real problem is that as a nation we have become a bunch of greedy #@%#'s that care only about ourselves and not our co-workers. We fall prey to the unscrupulous lawyers that feed off creating bogus healthcare claims and workers compensation claims, fraudulent insurance claims etc. This is the true problem with our country, no one takes resposibility for their actions, if they break the rules at work and get hurt, some scumbag lawyer is out their trying to figure out a loop hole to make thousands off the company. Am I blaming all the lawyers, No...because it takes another scumbag individual to make that happen. I know this, because I was victimized by these jerks. A great worker is one who takes pride in what they do and works hard at it. This should be accompanied by a safe and sound work environment where the employee feels appreciated by his or her employer regardless of union or non union status. I AM AN AMERICAN AND PROUD OF IT.
 

Got Venom

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:usa: Vic, I got you beat ;-) I have books that trace my fathers , fathers, fathers, etc., to coming over here form Suffolk England in 1638 on the ship "Elizabeth"

Armen,
Union workers are not evil people, I'm sure there are plenty of hard working ones. It's just that the system can not support automatic pay raises and automatic retirement programs anymore. Just like Government workers who complain that they don't get their automatic raises, or that they will get 75-95% of their pay per year when they retire. This is unheard of in our private industries that are going up head to head with the Asian competition. My workers had to take a 30-45% pay cut a few years ago. I finally gave them a small raise a year ago. I raised their deductable to $25 copay so that the insurance premiums would come down, and maybe they would think twice about going to the doctor for just a sniffle. "The money has to come from somewhere" People think that the Government should help out, well guess what, somebody has to give the Government the money.... I'm sure you are a hard woking guy, but it is an increasing burden on the automakers in this country to try and support the old system. By the way, I totally agree with the burden lawyers and litigation put upon our society. I wonder what would happen if the lawyers in this country tried to pull that stuff on some Chinese companies. I think they would dissappear???
 

Camfab

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Dennis,
I agree with what your saying regarding automatic pay raises. I do not work in the auto industry. I live in So Cal and work in the motion picture industry. Our locals have given concessions time and time again regarding healthcare as well as limitations in pay increases and decreased pay scales. The burden which GM has on a per vehicle basis is large, but if sales were similar to Toyota we wouldn't be talking about this. The healthcare issue is huge, but interestingly they always go after the workforce when things get slow. I really wonder how many of those financial execs who insisted GM should invest billions in Fiat, lost their jobs. I see healthcare as a cover up for for poor product design and archaic dealer networks. I had always been a Chevy guy. My last purchase was a new 2500HD, I bought it even though I felt the designers ruined the look of the truck. I have a great rapport with the local parts guy at the dealership so I decided to buy it. I felt the Dodge trucks were beautiful but I had such a bad experience with the Local Dodge service guys with my wifes Liberty that I decided against the Dodge. This is bad altogether, why?, because I'm buying a new vehilcle and already assuming I'm going to have issues. That's why GM is in trouble! Lets not forget the fact that, besides the trucks and the Vette they only make rental cars. If I'm wrong someone please tell me. GM's design team should be fired from the top down. Sorry if I'm steppimg on some toes, but it's the truth.
 
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