OT: GM Still Considering Bankruptcy

After taking US government bailout funds, GM is still considering bankruptcy, according to a story in the Saturday Wall Street Journal.
WSJ: GM Considering Bankruptcy

How can this be, after they LOWERED their credit standards so more people without the ability to pay, and after shystering the government into giving them billions of taxpayer dollars so they can continue to build shoddy vehicles, and pay huge hourly rates to union members to build the vehicles that no one wants, like the Hummer.

Looks like comrade messiah needs to whistle up a miracle.

Be careful on who you say builds shoddy vehicles. Last year Toyota set a record for the number of recalls on a single vehicle in one year. That"s 18 for the Camry.
Of the 17 million new vehicles sold last year, 12 million were produced by GM.
Shystering the government out of money? Turn your eyes to Barney Frank and Chris Dodd.

Gm does make a good product, I own 2 of them.

GM needs to do something drastic and make an offer to the retirees of say $40,000 as a payoff amount to get them off the payroll. If they dont accept the $40k then a bankruptcy judge will decide the benefits of the retirees to make sure GM survives.

The time has come.......Either eliminate many off the payroll who no longer produce for GM or go down the toilet---it is that simple.

Why not jst walk in and say "You're Fired" to all the employees they don't need thats what most companies do?

I figured as much, they will have to quit (bankrupt) and come back as a much leaner company. Thats what should have happened in the first place. The money they got would have been better used for the heat it provided while it was being burned than as a stop gap measure for a failing company. IMHO

My understanding is that money GM and the others got is a loan and has to be paid back. So I suppose if they file bancruptcy then they may have to pay back part of it at least. I don.t think they have much choice in order to clean things up.

They need to get the Unions in line with other manufactures an the only way is bankruptcy. I never liked the fact that a union could so big that it was ten time more powerful than the company I would like to the AFL-CIO get the axe and get things back to the local workers against the local company. But probably won't live long enough for that to happen.
Walt

Now, if the retirees get dumped, you know who gets the bill? The Taxpayers. Ever hear of the Pension Guarantee Corp.? Every time an unethical company weasels out of its pension obligations, the government--that is, the taxpayers--gets stuck with the tab.

So I guess the choice is, do we pay for an attempt to rebuild a viable GM, or do we pay for their retirees because the company didn't put enough money into the pension fund in the good years? Or do we get stuck paying for BOTH?

I don't think the retirees should have to "suck it up" just because the company didn't plan for the future properly. GM should've thought about the retirees before paying out millions in salaries and bonuses to the white-collar folks in good times and bad. Dumping the retirees off on the taxpayers is a chickens#it way out...let 'em go after Roger Smith and a few other execs and take back some of the millions in compensation THOSE folks got from GM first, before the taxpayers have to foot the bill.

I agree with what you are saying, but since Uncle sam can print money and give it to anyone they want--what the H3ll right? Does the pension guar. program insure full money compensation? Or just a partial.

I agree that GM is run poorly at all levels, Hourly, salaried, mang. and executives. My sister works there as a manager and is Wayyyy overpaid.

The pension guaranty corp isn't exactly a straight taxpayer funded corp. All corps with employe pension funds pay insurance premiums to the PGC and those fund out the retirement pay of those who get caught in a bankruptcy. Also, I believe that when a corp does go belly up, the pension funds are transferred to the PGC to help out those in that corp who go into that pool. A corporation isn't allowed to touch pension funds for operations. The only drawback is that a corporation can make investments on behalf of the fund to try to grow it for the retired employes. The GM hourly pension fund is approximately 10% underfunded and the salaried pension fund is about 10% overfunded, so those separate accounts would go to the PGC in case of bankruptcy.

Also, there now two tiers of both hourly and salaried workers. The old time UAW members up to a certain date get higher pay and pension funding, while newer employes get less hourly pay and have to pay their own 401k retirement plans. Pretty much the same for salary.

Yes, GM is in a world of hurt right now, some self-inflicted, and some just simply due to low car sales and inability to make the elephant nimble enough in the short time span since the market melted. I guess we'll all find out tomorrow, huh?

And the waste is just beginning. Now everybody and their brother will have a chunk of 800 billion to blow. It boggles the mind to think up how many ways that money will be flushed down the toilet. Anybody remember "midnight basketball"? Maybe we can bring that back along with every community having another cop on the street,paid for for a year or so by the federal government. Sorry,little flashback to the Clinton years there. I'm OK now.

why? can you say; unions? there man is now in the white house, anyone not in a union (88% of working americans) will now become second class citizens.

The current Pelosi/Reid boondoggle will make the GM chapter 11 look like when yer BIL ------ his weeks paycheck away inna bar.

If GM retirees need to lose their pensions, how about others on pensions? Like all taxpayer funded pensions for former government employees? Will social security be next? Where does this stop?

If the Government takes over the retirement they'll get in the range of 12-18k a year instead of 30-60k a year.

BEST THING TO HAPPEN TO GM SINCE PACKARD WENT UNDER!! CC

Donald nnalert has taken many of his companies through Chapter 11 to shead loans and is still swinging.

For the one's who followed United Airlines in Chapter 11 they came back swing. Gutted the unions and retirees and present workers. So GM maybe soon to do this to come to grips with run away employee cost. Ford for some reason is setting good with large off shore operations. GM has a BIG problem of geting out something to equal the rice burners for sales. Now that Nisson had shown it's hand of lay off's most of the rice burners to follow in the future.

A company that I worked for "not at the time I worked for them". A few years after they Fired me " they called it termination " said they didn't need me anymore. I was a salared worker.
One day they called all the salared workers in and told them thay were Fired . Then told them they would be rehired with a 40% wage cut. But the company would rehire in the order they wanted to , meaning they had lost all senority . when you are salared worker you have no rights & no recourse.

Has the sound's of GUEST WORKER????

why doesn't the union just agree to take some reasonable cuts so that the members can keep their jobs instead of losing them completely. I just read that the UAW people walked out of the negotiations today.

Now what bothers me the most about a union other than them making people believe that unskilled labor should be paid as much as skilled labor is that all the time those Union leaders are telling the members to strike, walk the line, take that strike pay which is really low, They are still making their high salary, still getting the full check and not having to sell anything to pay the bills or not take vacations or get into the savings.

I have always thought the best way to lead was by example and that is not it. then again I can't see why the union members can't see it either.

I guess if the people who need the jobs can't take a cut in some things and keep their jobs then they don't deserve to have them. Everyone is having to make cuts and concessions and they are not different.

I have heard I don't know how many times that "the company owes me this! Guess what? A company owes you your paycheck, anything else is a perk.

And on the other side, when you have management officials in the company making what most working people see as obscene salaries and they won't take any cuts either then the company deserves to fold under. The problem with most upper management is that they aren't concerned with the good of the company anymore but with how much they can get for themselves. Who do you know that honestly deserves a $50 million bonus?? I mean come on people. And I don't care what form that bonus is in, money, stock, whatever. No one is worth that and especially a person who is supposed to be making the company run profitable and isn't doing it. Guess what? If your company was making a profit before someone is hired to lead it and they are losing money afterwards, THEY AREN'T DOING THEIR JOB!!!!!!

I've just got a high school education and can figure that one out. My dad and another man own a business, when things are good everyone that works there does good. When things are tight and slow like now, The employees might get a smaller Christmas bonus but dad and his partner don't get one at all, I have seen them go for several months without a paycheck to make sure the employees get one. WE have painted presses and cleaned floors many times to keep people from being laid off.

But the management took the first hits not everyone else. Maybe these large corporation managers need to go back to thinking about the company first instead of themselves. And if it is a union company, the members need to think about if they are going to have a job at all to pay their bills instead of not one at all and lose everything.

Back in 1947 Henry Ford II decided that he needed to know what it cost to build each vehicle and to make sure that Ford was making a profit on that vehicle. If Ford wasn't making a profit then there was little reason to build the vehicle.

For example, asset utilization (normalized for sales volume), days of inventory, cost of scrap, etc. in the factory. Available engineering hours utilized in product design. Managers were then rewarded for making numerical targets using methods developed by staff experts that managers rarely understood. A good way to make many of these numbers was to make products in large batches in order to achieve high asset utilization and low cost per individual step. The total value creation process from end to end -- which had been so clear to Henry Ford -- was gradually lost from view.

Soon Ford executives using the financial measures developed by finance czar J. Edward Lundy were even more rigorous in analyzing the performance of their area of control than GM executives. Robert McNamara and the Whiz Kids were the exemplars. And Ford did regain competitiveness as a GM clone, claiming a stable second place in the auto industry.
In addition, by the late 1940s Ford was one of three U.S. auto companies using the same management system in the same town with the same union. With high investment barriers to entry, a remarkable era of stability was put place, lasting nearly forty years until the transplant Japanese factories succeeded in the U.S. in the later 1980s.

Ford CEO Alan Mulally needs to fundamentally rethink the supplier management system. Fundamentally rethink the product development system. And fundamentally rethink the production system from order to raw materials and from raw materials to delivery, with special attention to the information management system. (Much can still be learned from Ford's Mazda subsidiary, which became an able pupil of Toyota after a crisis in 1973.) Above all, fundamentally rethink what mangers do and how they do it in order to regain the gemba consciousness that originally took Ford to world dominance. In brief, Ford needs to remake itself once more, this time in the image of the company that copied Ford's original system: Toyota.

Ford needs refocusing of the remaining brands on what customers really want -- sophisticated, hassle-free transportation in every price range.

While Ford has constantly hired outside consultants to monitor and predict the futuire market they find it hard to forcast an anomally like the price of fuel doubling in price in just a few months because of speculation. When will it happen again? Therefore the autos must find alternate forms of energy to fend off the price os speculation on a commodity that is critical to their continued sales.

The predictions of over capacity where there back in the early 90's but the price of fuel and availabilty of that product is virtually impossible to predict long term.

Trotman, Nasser, Bill Ford, Mark Fields and Al Mullaly have been downsizing the fixed cost of both salaried and hourly labor. Automation, outsourcing and headcount reduction are the three ways to reduce the labor costs.

Also their has been a constant drive to increase the knowledge of their work force. that effort will result in a worker that is more quality and cost conscious than ever before and have the necessary tools at their finger tips to make the porducts that will sell. Education is mandated where the workers must continually take and pass classes in Ford's Technical Education Program. The salaried workers must virtually apply for their job position every year as a part of their employee review. They must design their own education enhancement in concert with the company guidlines and must demonstrate that they have achieved their goals on a quarterly basis.

The wisdom you exhibit in making such a remark is simply amazing. rw

That same 88% will be the ones that refuse to buy a new car and then we will reallize our real power and who REALLY holds the cards in this game.People don't NEED new cars!!! Let them die. They and the unions that run them are going to find out exactly what FREE ENTERPRISE really means!