# Chrysler down, GM Next?



## GuitarsCanada (Dec 30, 2005)

Well, Chrysler is in chapter 11. I am thinking there may be no other avenue for GM other than to do the same. Without breaking my own rules on political threads... I will just say that there is a lot of political aspects to this bankruptcy and will be with GM too.

For any of you caught in the crossfire, hang in there and hope for the best. See what they can manage out of this craziness. Fiat deal was signed so at least that is something they have to look for on the other side of this.


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## Robert1950 (Jan 21, 2006)

My dad worked at Chrysler, my brother works at Chrysler. My mother, who will be 90 this month, still receives a Chrysler spouse's pension. My dad was the one who organized the first CAW clerical union at the the now defunct Ajax plant some 45 years ago. So as you see, I have a biased opinion about the restructuring, bailout and how this whole thing turns out.


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## keeperofthegood (Apr 30, 2008)

A week or ten days back, one of the 'analysts' had made a comment that about 50% of GM's holdings on their own have value, and bankruptcy would let them lose off the other 50%. 

For all the announcements this week of ending Pontiac, ending Saturn, ending one other that escapes me at this time, and the 100's of dealerships they are closing, I am wondering what 50% of GM has value?

At the least, as far as I read in the news, the warranty has been garunteed by at least Ontario on GM vehicals, and parts manufacture for them as well. That at least is good. I do not know (have not heard) what became of the pension issues, that one will be the hotter political side judging by the worker responce.

:/ once upon a time our government bought a money loser. It sunk gobs of cash into it. Suddenly they were raking in the cash as the market turned around. Hibernia became a money maker and not a white elephant. I can only hope our national and provincial investment in Chrystler does the samn.


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## GuitarsCanada (Dec 30, 2005)

Robert1950 said:


> My dad worked at Chrysler, my brother works at Chrysler. My mother, who will be 90 this month, still receives a Chrysler spouse's pension. My dad was the one who organized the first CAW clerical union at the the now defunct Ajax plant some 45 years ago. So as you see, I have a biased opinion about the restructuring, bailout and how this whole thing turns out.


I'm with you on that. I still have some blue running through my veins. My Father worked at GM for 42 years, he is 78 and on a pension. I worked directly for GM for 13 years and then sold to them for another 12. hard to get it out of your system.


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## Milkman (Feb 2, 2006)

Yup. As (I think)most of us predicted, Chrysler was the first to fall. This is big. I said it would happen, but not with any desire to _see_ it happen.

The impact to the other OEMs is now showing signs of happening. The supply chain is starting to colapse and as a result I'm so freaking busy at work it's tough keeping up. Travelling every week. 


I wish the best of luck to Chrysler employees, and to all the employees at suppliers impacted by this. It's possible in my opinion, that Chrysler may emerge leaner and with new direction in a partnership with Fiat.

Look at what Carlos Ghosn managed to do with Nissan. It's one of the most remarkable come backs I can remember seeing in the auto industry (or any industry for that matter). Let's cross our fingers and hope.


We'll see about GM, but I wouldn't be surprised to see them file chapter 11 June 1.

This is like the perfect storm. The "end of the world" folks must be wringing their hands. Between Swine Flu and the ongoing recession from hell, all we need is a huge natural disaster to make their day.


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## keeperofthegood (Apr 30, 2008)

Milkman said:


> ...
> 
> This is like the perfect storm. The "end of the world" folks must be wringing their hands. Between Swine Flu and the ongoing recession from hell, all we need is a huge natural disaster to make their day.


+1 for the optimistic views :rockon2:


I should PS and say, it can be seen coming, and has been for months now. It is a shame the workers and families of all affected are caught up in the middle. Without pay, you cannot purchase, without purchasing corporations have no funds, without funds... I have had friends in person as well directly affected by this, part of the decay of the supply chain for GM. I am sure there will be more yet to come before things begin to heal and become better again.


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## Milkman (Feb 2, 2006)

keeperofthegood said:


> +1 for the optimistic views :rockon2:
> 
> 
> I should PS and say, it can be seen coming, and has been for months now. It is a shame the workers and families of all affected are caught up in the middle. Without pay, you cannot purchase, without purchasing corporations have no funds, without funds... I have had friends in person as well directly affected by this, part of the decay of the supply chain for GM. I am sure there will be more yet to come before things begin to heal and become better again.


I'm actually pretty upbeat but I've just seen _so_ many good people lose jobs in the past three years (we were actively "right-sizing" for a couple of years before the recession hit) it's sobering. I think we'll start to see light at the end of the tunnel around November, but no real ramp up until well into the first or even second quarter of 2010.


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## Luke98 (Mar 4, 2007)

It's terrible to think how hard of a time families will have because of this whole mess. I can only sympathize... I believe the world (especially of automobiles) will be a much different place in a few years, however long it takes to pull out of the recession...


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## fraser (Feb 24, 2007)

> It's terrible to think how hard of a time families will have because of this whole mess. I can only sympathize


why? because now those folks are stuck living like the rest of us now?
that seems twisted somehow.


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## Guest (May 2, 2009)

I look forward to the leaner, more innovative, more competitive machine that will rise from the ashes. Could even be machines, plural. We're about to start a new era for automotive innovation in North America.

http://globaleconomicanalysis.blogspot.com/2009/04/new-lease-on-life-for-chrysler.html


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## GuitarsCanada (Dec 30, 2005)

fraser said:


> why? because now those folks are stuck living like the rest of us now?
> that seems twisted somehow.


Thats brutal man, losing a job is losing a job. Anyone taking any pleasure whatsoever with the failure of these companies needs to re-think the situation. These auto companies affect every single one of us in one way or the other. The residual effects are too many to list. Would you also lump in the kid that will lose his $9.00 an hour job washing cars at the dealership? Or the single mother of three at the reception desk, pulling down 25K a year?

The effects are enormous and widespread.


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## Wild Bill (May 3, 2006)

fraser said:


> why? because now those folks are stuck living like the rest of us now?
> that seems twisted somehow.


What's that german word? Schadenfreude? Taking pleasure in someone getting what they deserved?

I too feel sorry for anyone losing their job but like you Fraser I still have some mixed feelings about it.

My industry collapsed at the end of 2001 and has never recovered. Thousands of us no longer had a career. We were left to scrape for what ever we could find. The media never noticed. No one cared about us!

Back in 1980 I had just sold my Chrysler van. Biggest piece of crap I could have bought! I was just a young kid and it was my first new vehicle. It had a 2 year warranty and in the 3rd year it nearly put me in the poorhouse. The quality was just so bad. Finally I dumped it!

I bought a VW Rabbit convertible. What a helluva lot of fun! I did a lot of 'fun' driving in those days and was used to paying about $350 a month for gas. The first month with my Rabbit I spent $50! That gave me almost enough in savings to pay my financing bill!

The first summer my girl friend/future wife and I went up north and rented a cottage on a lake with some friends. We got up that first morning and there was a guy walking by who had stopped to look at my car. "Is that a Volkswagon?" he asked?

After a bit he asked me "Doesn't it bother you that you are taking away some local guy's job?"

Turns out he worked for Chrysler in Windsor, making transmissions and stuff for cars and the very van I had dumped!

We of course got into it. I told him flat out that I just couldn't afford to drive another Chrysler product and that why should I save his job when he likely made 3 times as much as I ever had?

We agreed to disagree!

Now I fully understand how the collapse of the auto sector hurts us all. I can grudgingly accept the idea of bailouts with my tax money. I certainly understand that laid off workers anywhere have families too!

Still, I've never made as much as many of those autoworkers. My industry never got any bailouts. 

Perhaps I shouldn't feel resentful but I just can't help it.

:food-smiley-004:


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## Milkman (Feb 2, 2006)

GuitarsCanada said:


> Thats brutal man, losing a job is losing a job. Anyone taking any pleasure whatsoever with the failure of these companies needs to re-think the situation. These auto companies affect every single one of us in one way or the other. The residual effects are too many to list. Would you also lump in the kid that will lose his $9.00 an hour job washing cars at the dealership? Or the single mother of three at the reception desk, pulling down 25K a year?
> 
> The effects are enormous and widespread.


Exactly right. Here's a simplified chain of events for anyone who thinks this is somehow isolated to the Detroit Three.

1. Chrysler fails
2. Chrysler's major suppliers fail
3. Those suppliers also supply Honda, Toyota, Nissan
4. Honda, Toyota, Nissan can't build cars

et cetera, et cetera


We've already had to go to one of our suppliers and pull tooling and materials because they went bankrupt as a result of the Detroit Three's drastically slashed output.


I don't like the unions, but this involves much more than that.


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## GuitarsCanada (Dec 30, 2005)

I am not sure where all the "autoworkers are rich" thing ever came from to begin with. They make 'good" money, buts it's not insanely good money. I worked for GM for many years and I think my best year there was around $48,000

I know some guys there that have made upwards of 70K a year but these are major grinders and essentially work 7 days a week to make that. Where the difference was is in the benefits. The benefits by all means got out of hand starting in the early 80's. There is no need for a lot of things that were given that ended up costing the company way too much in total wages. 

Now, your supply base makes nowhere near what the big three factory worker makes. These are men and women making around $15.00/hr with moderate benefits. Many of these people will lose their jobs. Many have already lost them. Before I quit my last job the company had closed 3 of seven plants and shed around 400 jobs. These were not you "high paid" auto worker. Thats one company in a list of thousands that have dropped employees or closed plants.


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## bagpipe (Sep 19, 2006)

As always, these guys are the true winners in any of these bankruptcy dealings. They must be rubbing their hands with glee!

http://www.bloomberg.com/apps/news?pid=20601103&sid=a6H2Wa0kmZL8&refer=us


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## Rugburn (Jan 14, 2009)

IMO one of our biggest problems is the weakness of our domestic economy. We've allowed big business to out-source so much of our manufacturing base, that all we really have left is the auto sector. Now that it's in serious trouble, we have to bail them out. A statistic that the CAW kept repeating was that the average labour costs for the automakers is 7%. Yet, they are being made to shoulder a disproportionate share of the "restructuring" costs. This is an industry that fought over-regulation, moved factories to Mexico in good times and continued to build and design very expensive and wasteful automobiles, despite it's successes with electric vehicles in the 90's.(many auto publications/reviews sited Ford's EV as the best electric automobile design in the world at the time. It was also featured in the film "Who Killed The Electric Car?".) Now in crisis due to mismanagement, they're begging North America's governments for taxpayer money. I honestly don't know what people expect. There are more cars and trucks in North America than North Americans want or are willing to buy. Yet we're going to lend these companies billions to keep the factories building more cars and trucks. It's like watching a friend with a serious drug problem. You give him ten bucks and hope he spends it at the super market, but you know he's going to do what he's always done.

Shawn


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## fraser (Feb 24, 2007)

GuitarsCanada said:


> Thats brutal man, losing a job is losing a job. Anyone taking any pleasure whatsoever with the failure of these companies needs to re-think the situation. These auto companies affect every single one of us in one way or the other. The residual effects are too many to list. Would you also lump in the kid that will lose his $9.00 an hour job washing cars at the dealership? Or the single mother of three at the reception desk, pulling down 25K a year?
> 
> The effects are enormous and widespread.


sorry, i didnt intend to sound like i took pleasure in it.



> What's that german word? Schadenfreude? Taking pleasure in someone getting what they deserved?


yup bill, thats the word.


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## james on bass (Feb 4, 2006)

GuitarsCanada said:


> Thats brutal man, losing a job is losing a job. Anyone taking any pleasure whatsoever with the failure of these companies needs to re-think the situation. These auto companies affect every single one of us in one way or the other. The residual effects are too many to list. Would you also lump in the kid that will lose his $9.00 an hour job washing cars at the dealership? Or the single mother of three at the reception desk, pulling down 25K a year?
> 
> The effects are enormous and widespread.



Good post. I was automotive for about 6 years. We were CAW and many of the guys on the floor were spoiled little brats. In a way, I am very happy to see my old place close down and these guys out of work with no skills and actually having to face a little reality.

Okay, rant over. 

GC, you hit the nail on the head. So many residual jobs people don't think about. They think if they buy a Honda made in Ontario, they are more patriotic than buying a GM made in Mexico. That GM in Mexico has thousands upon thousands of Canadian and US jobs supporting the build of that vehicle, while the Honda is more or less just shipped over then assembled here with only a couple residual factories in the area supplying them.

The trickle down effect of any of the Big 3 going down, is almost unthinkable and people just don't get it still.


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## Milkman (Feb 2, 2006)

james on bass said:


> They think if they buy a Honda made in Ontario, they are more patriotic than buying a GM made in Mexico. That GM in Mexico has thousands upon thousands of Canadian and US jobs supporting the build of that vehicle, while the Honda is more or less just shipped over then assembled here with only a couple residual factories in the area supplying them.



Sorry, while I agree that the impact of the Detroit Three collapse is much worse than some folks would like to believe, I have personal first hand knowledge of Honda's operations in North America and I'm afriad you're mistaken about their assembly operations.


The Civic, Accord, Odyssey, Ridgeline and Element are built in Canada and the US. Much of the supply base is domestic. Certainly there are many parts coming from South Easy Asia and China, but that's also true of the Detroit Three.

In Alliston alone there are three factories employing several thousand Canadians, the vast majority of which will sing the praises of their employer.

The same is true for the Honda plants in Ohio, Indiana and Alabama.


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## Jim DaddyO (Mar 20, 2009)

It was Chevy that made the EV-1 that was on the show "who killed the electric car". Toyota and Honda do not buy all that much from suppliers that service the domestic market. They have a chain of other suppliers that supply them with parts. Places like Aisin, Hyashi, etc., and all they do is a specific part for Toyota (Carpets, seats, etc.). I worked in a world leading supplier up until getting injured. We supplied GM, Chrysler, Ford, BMW, Mercedes, Harley Davidson, Audi, but very little to Japanese companies, who prefer to deal with other Japanese companies, even if they are based in North America.
I made great money at my job, but they have opened up a Mexican plant and there are huge layoffs. They also have other plants worldwide, and shift production to where it is cheaper (Asia, former Soviet block countries, South America). But still, for a world leader in their field, not much in the way of supplying japanese manufacturing. This is not the first plant I have worked in that is in the same position. I have worked CAW and non union plants. Some of the benefits in the union plants are just stupid. I think the union ought to go back to its roots of fair wage for a good job. Stop protecting the jobs for some dog effer that does not appreciate it. Let the dead wood go. I don't care if the company I am working for is making billions in profit. I just want a decent wage, some reasonable benifits, and to be treated fairly. 
That being said, I need a new career. WSIB will retrain me, but I cannot figure out what has a future ahead of it. It most certainly is not in manufacturing, even if I could do it. Anyone have a crystal ball?


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## james on bass (Feb 4, 2006)

Hey Jim, manufacturing for the environmental sector is probably where it's at. I've heard of a couple companies in my area re-tooling from auto-motive to supply the wind turbine industry, which is right in your neck of the woods. 

I tried very hard to get into something environmental because I beleive that is the future, but I got into the next best thing - the food industry. I plan on staying. 

I agree with you on the union thing. It's an outdated concept. All it did was protect those that should be out kicking stones; deadbeats that bring everyone else's morale down.


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## Jim DaddyO (Mar 20, 2009)

Well, I was aiming for the Alternative Energy Engineering Technology program at Lambton College in Sarnia. WSIB, screwed me around long enough that I missed the enrollment date, the pricks. They expected me to drive over 2hrs. one way, everyday, all winter, down the coast of Lake Huron. So now I have to wait another year. Still considering it though. WSIB were all in a big hurry to get my assessment done, then sat and did nothing with it for 6 weeks while I was on sick leave for an operation. They never even phoned to ask questions about the logistics of getting back and forth. I think they should change their motto to DUH!


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## Milkman (Feb 2, 2006)

Jim DaddyO said:


> It was Chevy that made the EV-1 that was on the show "who killed the electric car". Toyota and Honda do not buy all that much from suppliers that service the domestic market. They have a chain of other suppliers that supply them with parts. Places like Aisin, Hyashi, etc., and all they do is a specific part for Toyota (Carpets, seats, etc.). I worked in a world leading supplier up until getting injured. We supplied GM, Chrysler, Ford, BMW, Mercedes, Harley Davidson, Audi, but very little to Japanese companies, who prefer to deal with other Japanese companies, even if they are based in North America.
> I made great money at my job, but they have opened up a Mexican plant and there are huge layoffs. They also have other plants worldwide, and shift production to where it is cheaper (Asia, former Soviet block countries, South America). But still, for a world leader in their field, not much in the way of supplying japanese manufacturing. This is not the first plant I have worked in that is in the same position. I have worked CAW and non union plants. Some of the benefits in the union plants are just stupid. I think the union ought to go back to its roots of fair wage for a good job. Stop protecting the jobs for some dog effer that does not appreciate it. Let the dead wood go. I don't care if the company I am working for is making billions in profit. I just want a decent wage, some reasonable benifits, and to be treated fairly.
> That being said, I need a new career. WSIB will retrain me, but I cannot figure out what has a future ahead of it. It most certainly is not in manufacturing, even if I could do it. Anyone have a crystal ball?



Yes The Japanese OEMs do tend to deal with Japanese suppliers (although not exclusively), but most of those Japanese suppliers have factories in Canada and the US employing, yes, you guessed it, Canadians and Americans. 

It's also important to note that there is also a strong "buy American" mentality at many American and Canadian manufacturers. It works both ways.


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## Guest (May 4, 2009)

There is a saying that goes like this "Companies get the unions they deserve".
Chrysler was renown for its mediocre employee relations. In return they got a bloodthirsty union that stopped at nothing to get everything it could. Had the company been less profit driven in the first place it might not have had a union to contend with altogether. Honda and Toyota come to mind. Just look at it as two really tough customers who beat each other into the ground. From where I stand blame is to be shared pretty equally.


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## GuitarsCanada (Dec 30, 2005)

GM confirmed today that it has issued up to 300 letters to Canadian car dealerships to inform them that they will be closed. So remember what I had mentioned earlier about some that are quietly having a little chuckle at all the autoworkers that are going to be out of work. It does not stop at the plant level. It's going to trickle down right to the kid washing cars at the service bay.


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## allthumbs56 (Jul 24, 2006)

GuitarsCanada said:


> GM confirmed today that it has issued up to 300 letters to Canadian car dealerships to inform them that they will be closed. So remember what I had mentioned earlier about some that are quietly having a little chuckle at all the autoworkers that are going to be out of work. It does not stop at the plant level. It's going to trickle down right to the kid washing cars at the service bay.


It'll be interesting to see how it all plays out. GM doesn't own the dealerships - they are all franchises. I do assume that those that carry the Pontiac brand may be the most likely to go.

Several years ago I worked in sales at a GM dealership and most of the time my competition wasn't from another manufacturer but from the half-dozen other GM dealerships in the area.


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## GuitarsCanada (Dec 30, 2005)

allthumbs56 said:


> It'll be interesting to see how it all plays out. GM doesn't own the dealerships - they are all franchises. I do assume that those that carry the Pontiac brand may be the most likely to go.
> 
> Several years ago I worked in sales at a GM dealership and most of the time my competition wasn't from another manufacturer but from the half-dozen other GM dealerships in the area.


It will play out just like Chrysler. The dealers can huff and puff and say they have a contract but in the end they are going to close them and thats it. In or out of bankruptcy. The Chrysler dealers are screaming but to deaf ears. You can bet that buried somewhere in the 10,000 tiny words in that franchise agreement there is a way out for GM.


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## keeperofthegood (Apr 30, 2008)

Hey just another 2cents here. I am also thinking it is like acne. You know, the kind that swells and gets big and hurts like a real SOB. Doesn't begin to feel good until it pops, oozes and begins to heal.

I am seeing that many companies that have downsized, or reduced staff, or pay, are ones that are dependent or affected by whichever way GM goes. I think once a definitive statement of either bankruptcy or the end of the need to fear bankruptcy happens, a lot of business will ease up and start moving again.

Worst place to be, sitting wondering "will it fall?" when your business is one onto which it could fall.


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## al3d (Oct 3, 2007)

Our local dealer...biggest seller in all Quebec will be closing. not that it's gonna be a shame..owner was a freaking crook.


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## GuitarsCanada (Dec 30, 2005)

keeperofthegood said:


> Hey just another 2cents here. I am also thinking it is like acne. You know, the kind that swells and gets big and hurts like a real SOB. Doesn't begin to feel good until it pops, oozes and begins to heal.
> 
> I am seeing that many companies that have downsized, or reduced staff, or pay, are ones that are dependent or affected by whichever way GM goes. I think once a definitive statement of either bankruptcy or the end of the need to fear bankruptcy happens, a lot of business will ease up and start moving again.
> 
> Worst place to be, sitting wondering "will it fall?" when your business is one onto which it could fall.


I think you can almost count on it going Chapter 11. It's really the only smart and economical way for GM to proceed. They will emerge a much healthier company in terms of financials. They need to shed all the creditors and bankruptcy is about the only way they can do that, legally. The only thing that remains is how much they can squeeze out of the unions between now and then. The company sees this as a huge opportunity to claw back many of the benefits and wages that have been gained over the last 20 years. I think they will be very successful in doing that. So in the end, the only people that will have suffered are the actual workers (salaried as well as hourly). The investors will get their returns as long as they hang on to the stock. The executives will remain highly paid. 

The consumer will still be able to buy a GM vehicle, not on every street corner as they do now but in big urban centers. Your cost savings? Try zero.


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## bagpipe (Sep 19, 2006)

GuitarsCanada said:


> I think you can almost count on it going Chapter 11. It's really the only smart and economical way for GM to proceed. They will emerge a much healthier company in terms of financials. They need to shed all the creditors and bankruptcy is about the only way they can do that, legally.


Chapter 11 allows companies to "get away" with a lot more than they can in normal circumstances. My company is involved with Nortel who are currently under Chapter 11 bankruptcy protection. This allows them to shed existing employees without giving them a severance package. Those ex-employees then become unsecured creditors who may eventually get their package. Pretty unlikely though as the secured creditors are first in line at the feeding trough.


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## allthumbs56 (Jul 24, 2006)

GuitarsCanada said:


> The investors will get their returns as long as they hang on to the stock.


Actually, under Chapter 11, 99.9 % of the time the stock is worth virtually zippo - the "owners" (shareholders) are the very last in line to collect. Their stock, which once traded at over 70 bucks a share is at just over a buck, only being bought by "long shotters" who could POSSIBLY make out like bandits if GM somehow doesn't go into bankrupcy. Otherwise it'll be "pennies-on-the-dollar". 

Last week even the top execs were dumping all their holdings.


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## GuitarsCanada (Dec 30, 2005)

*CAW - GM Reach New Deal*

The details are not being released yet but apparently the deal includes concessions that would get GM an addition $16.00/hr out of wages/benefits

The deal also stipulates that Oshawa car and St Catharines plants cannot be shut down.

We will see how this plays out.

http://cnews.canoe.ca/CNEWS/Canada/2009/05/22/9537741-cp.html


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## Guest (May 22, 2009)

GuitarsCanada said:


> The deal also stipulates that Oshawa car and St Catharines plants cannot be shut down.


What does that mean "cannot be shut down"? If no one is buying the cars they make, if the company is tanking, why can't they be shut down? What are they supposed to do? Pay people to push dust bunnies around manufacturing floors?


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## GuitarsCanada (Dec 30, 2005)

iaresee said:


> What does that mean "cannot be shut down"? If no one is buying the cars they make, if the company is tanking, why can't they be shut down? What are they supposed to do? Pay people to push dust bunnies around manufacturing floors?


It simply means that if demand exists, those plants stay open and they would have to close another location that makes the same or similar parts. Clearly, if there is no demand then all bets are off. But as long as there is, those plants get used first.


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## Guest (May 22, 2009)

GuitarsCanada said:


> It simply means that if demand exists, those plants stay open and they would have to close another location that makes the same or similar parts. Clearly, if there is no demand then all bets are off. But as long as there is, those plants get used first.


So even if they could produce, or are producing, the same parts in another location for less, with high consistency and quality, if demand slips the better, lower cost site gets the axe?


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## GuitarsCanada (Dec 30, 2005)

iaresee said:


> So even if they could produce, or are producing, the same parts in another location for less, with high consistency and quality, if demand slips the better, lower cost site gets the axe?


Thats correct, Sir. Thats what happens at the negotiation tables... you give, I give. I can say for myself though that I would much rather see my boy's here in town working then the Mexicans. No offense. On the other hand, quality wise you would be hard pressed to beat these plants locally. Oshawa as well. They have always had stellar quality ratings.


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## lbrown1 (Mar 22, 2007)

GuitarsCanada said:


> Thats correct, Sir. Thats what happens at the negotiation tables... you give, I give. I can say for myself though that I would much rather see my boy's here in town working then the Mexicans. No offense. On the other hand, quality wise you would be hard pressed to beat these plants locally. Oshawa as well. They have always had stellar quality ratings.


that's just how we do things here in these parts!


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## Guest (May 23, 2009)

GuitarsCanada said:


> Thats correct, Sir. Thats what happens at the negotiation tables... you give, I give. I can say for myself though that I would much rather see my boy's here in town working then the Mexicans. No offense. On the other hand, quality wise you would be hard pressed to beat these plants locally. Oshawa as well. They have always had stellar quality ratings.


The mind reels. How a CEO stays in charge of a company making deals like that is beyond me. Auto manufacturer is truly another world. That sort of deal would go over like a ton of bricks in high tech.


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## prsrick (May 15, 2009)

CEO is only there to collect big bonus even the company is in deep trouble.
Look at Nortel!


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## GuitarsCanada (Dec 30, 2005)

So as of yesterday, GM's creditors have rejected the settlement offer. This now makes it about a 99.9% chance that GM will file for chapter 11 next week. So with the new labor agreements reached with the UAW and CAW, the planned closure of dozens of plants and shedding another several thousand jobs, GM is poised to enter chapter 11, force the creditors to take whatever they get offered. After that, with a little luck they will come out of it all smelling like roses with a much smaller workforce getting paid substantially less. Things are looking up.


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## Milkman (Feb 2, 2006)

Yup,

They'll file for Chapter 11 on Monday or Tuesday. Hold on to your hats folks. That's a big assed rock that's being tossed into the pond.


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## GuitarsCanada (Dec 30, 2005)

So we enter into a new chapter in the history of the North American Auto industry. Never thought I would see the day... part of it was a natural progression, the other arrogance and unwillingness to change and the rest bad luck. Lets see how it all shakes out in court.


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## bagpipe (Sep 19, 2006)

Apparently one of the first actions they've taken is to unload the Hummer brand to a Chinese company. Hummer was always a high cost, low volume line. This looks like a step in the right direction for GM:

http://business.brisbanetimes.com.a...mmer-brand-to-chinese-firm-20090603-burn.html


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## Guest (Jun 3, 2009)

bagpipe said:


> Apparently one of the first actions they've taken is to unload the Hummer brand to a Chinese company. Hummer was always a high cost, low volume line. This looks like a step in the right direction for GM:
> 
> http://business.brisbanetimes.com.a...mmer-brand-to-chinese-firm-20090603-burn.html


Huh. So does that mean the Chinese Government now makes the U.S. militaries light transportation vehicle of choice? Or does manufacture of the military version of the Hummer stay in the US? Man, I hope it stays in the US -- I'll be mighty ticked if it doesn't. Huawei was all set to buy Nortel's Metro-area stuff and the US Gov't scuttled it because they were worried about all the Nortel networking infrastructure they had deployed being owned by the Chinese Gov't. ARGH!


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## GuitarsCanada (Dec 30, 2005)

iaresee said:


> Huh. So does that mean the Chinese Government now makes the U.S. militaries light transportation vehicle of choice? Or does manufacture of the military version of the Hummer stay in the US? Man, I hope it stays in the US -- I'll be mighty ticked if it doesn't. Huawei was all set to buy Nortel's Metro-area stuff and the US Gov't scuttled it because they were worried about all the Nortel networking infrastructure they had deployed being owned by the Chinese Gov't. ARGH!


Thats a good question. They are basically two different vehicles. The Hummer is the civilian version of the vehicle. The Humvee is the military version. The Humvee was built by AM General until GM got involved and at first all you could get was the military version minus the weapons systems. Thats when people like Arnold (terminator) were buying them for enormous sums. But being the military version, they were were barely street legal and very wide. Too wide for most of the roads they were used on. So the Hummer was created for civilian use. Very much the same vehicle. Then came the H2 and H3 versions. Each watered down and made lighter and cheaper. 

I would be surprised if any of the military systems were included in any sale, since that is something that the governments "adds on" the vehicles and that would be all top secret stuff.


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## pattste (Dec 30, 2007)

iaresee said:


> So even if they could produce, or are producing, the same parts in another location for less, with high consistency and quality, if demand slips the better, lower cost site gets the axe?


A car company owned by three governments and a union. I'm sure that's gonna work well.


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## pattste (Dec 30, 2007)

I hope the following isn't going to be considered a political comment and against the rules, considering that all political parties support the government bailout of the two losers:

You take the $13 Billion that they're "investing" in GM/Chrysler (until they come asking for more) and you can loan One Million Dollars each to 13,000 small and medium size Canadian businesses.

Which scenario will create and sustain the most jobs?

Which scenario has the greatest likelyhood of repayment?


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## keeperofthegood (Apr 30, 2008)

pattste said:


> I hope the following isn't going to be considered a political comment and against the rules, considering that all political parties support the government bailout of the two losers:
> 
> You take the $13 Billion that they're "investing" in GM/Chrysler (until they come asking for more) and you can loan One Million Dollars each to 13,000 small and medium size Canadian businesses.
> 
> ...



I will agree that, as it is all levels of government on many nations behalf (no just a Canada thing) that this is not a political perspective or statement other than to say that the whole 'bailout' deal has shown how bonehea... well, staying the sane side of politics is hard.

SO GREAT, we own 13%(ish and maybe more) of a sinking ship that is also breaking up and winging itself off in all directions. We did (as a nation, Canada did that is) the same with Oil and those projects have since raked in the $$$. To do the same with cars AND rake in the $$$ our governments will need to actually build cars...

...

...

 I know, I am also trying to imagine the Canada Built Car, but all I see is the acronym.


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## Guest (Jun 3, 2009)

GuitarsCanada said:


> Thats a good question. They are basically two different vehicles. The Hummer is the civilian version of the vehicle. The Humvee is the military version. The Humvee was built by AM General until GM got involved and at first all you could get was the military version minus the weapons systems. Thats when people like Arnold (terminator) were buying them for enormous sums. But being the military version, they were were barely street legal and very wide. Too wide for most of the roads they were used on. So the Hummer was created for civilian use. Very much the same vehicle. Then came the H2 and H3 versions. Each watered down and made lighter and cheaper.
> 
> I would be surprised if any of the military systems were included in any sale, since that is something that the governments "adds on" the vehicles and that would be all top secret stuff.


Yup. You got it right: Miltary Humvees are still made by a separate company and not included in the deal. I guess China just bought the car equivalent of junk bonds?


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## Fader (Mar 10, 2009)

At General Motors of Canada Ltd. alone, the rescue package could amount to a staggering *$1.4-million for every job saved*, with no guarantee that the bailout will ensure the long-term survival of the company's remaining auto assembly and engine plants.


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## GuitarsCanada (Dec 30, 2005)

Fader said:


> At General Motors of Canada Ltd. alone, the rescue package could amount to a staggering *$1.4-million for every job saved*, with no guarantee that the bailout will ensure the long-term survival of the company's remaining auto assembly and engine plants.


Make no mistake that this whole thing is a well orchestrated plan to bring a company back to profitability. They are shedding a ton of debt in terms of labour, capacity and costs that without this whole "economic downturn" would not have been possible. The whole idea is to make money. Be it GM, Chrysler or Walmart. The economic and human devastation that would have occured should the natural process be allowed to happen would have been too much for government to absorb. So this was the best of the two evils shall we say. There are still going to be a lot of lost jobs and pain, but there will be many jobs saved and in the long run that is the best thing for the government and the people.

Give GM and Chrylser two years and I predict they will return to profitability and in a big way. The governments will pull out at the earliest opportunity. Whats left to see is if they will return to their old ways 5 years from now. Expanding into areas they dont belong. They need to concentrate on the core business and they will be successful. If anyone thinks that GM or Chrysler or Ford cannot compete and make just as good a vehicle as anyone on earth they are wrong. There is no magic to it. They already have the best powertrains. They need to stop screwing around and concentrate on design and delivering to the market what people want to drive and be willing to spend the money on.


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## allthumbs56 (Jul 24, 2006)

Pardon me Mods if I walk the political line for a moment but I think it is essential that the Canadian and US governments back out of these deals as soon as they possibly can because they just can't keep their meddling hands off of anything. Really, what automotive companies need in order to survive and flourish is at cross-purposes with what governments must champion. Think about it: Government = "environmentally friendly, green, bikes-vs-cars, public transit, reuse/recycle" Business = "more, bigger, cheaper, convince customers to throw-away-and-replace".

Really, what the world needs is a "fully sustainable-always repairable-never-needs-replacing-cheap to operate forever vehicle". But how long can you stay in business if you only sell one vehicle per person's lifetime? It's like that commercial for the gum that lasts too long.

Hmmmm ..... I just had a provoking thought ....... let's say that Philip Morris needed a government bailout in return for a 60% ownership share ........ Now wouldn't that have been something ....9kkhhd


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## Milkman (Feb 2, 2006)

While I understand the significance and impact of GM filing Chapter 11, I question laws that allow a company to completely rape their shareholders, get massive bail outs from the tax payers (some of which are ALSO shareholders) and emerge as a more profitable entity afterwards.

If you own stock in GM, how do you feel about this?


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## GuitarsCanada (Dec 30, 2005)

Milkman said:


> While I understand the significance and impact of GM filing Chapter 11, I question laws that allow a company to completely rape their shareholders, get massive bail outs from the tax payers (some of which are ALSO shareholders) and emerge as a more profitable entity afterwards.
> 
> If you own stock in GM, how do you feel about this?


Fortunately, I sold all my GM stock about 2 years ago. Did pretty good on it. I would not be pleased if I owned it today.


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## allthumbs56 (Jul 24, 2006)

Milkman said:


> If you own stock in GM, how do you feel about this?


Taken directly from the bankrupcy filing:



> Common equity, 60.8 percent of which will be owned by the U.S.
> Treasury, 11.7 percent of which will be owned by the Canadian and
> Ontario governments, 17.5 percent of which will be owned by the New
> VEBA, and 10 percent of which has been reserved for GM for the benefit
> of the unsecured bondholders and other unsecured creditors of GM


Add up the above allocations. What's leftover belongs to the shareholders.


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## torndownunit (May 14, 2006)

GuitarsCanada said:


> Give GM and Chrylser two years and I predict they will return to profitability and in a big way. The governments will pull out at the earliest opportunity. Whats left to see is if they will return to their old ways 5 years from now. Expanding into areas they dont belong. They need to concentrate on the core business and they will be successful. If anyone thinks that GM or Chrysler or Ford cannot compete and make just as good a vehicle as anyone on earth they are wrong. There is no magic to it. They already have the best powertrains. They need to stop screwing around and concentrate on design and delivering to the market what people want to drive and be willing to spend the money on.


I don't share your optimism. I am likely a younger generation than you (32) and I know exactly 2 people who drive GM, Ford or Chrysler. That is, other than friends parents. 

I mentioned this in another post on the topic, but they already did their damage with my generation. Back when I first started buying cars they offered NOTHING that competed with what companies like Honda and Toyota offered. Now they do, but during my early years buying cars I have owned 3 foreign cars, have been extremely happy with the vehicles and the service, and have no reason to venture to another brand. Those companies lost me as a customer a long time ago. And again, most people *I* know are in the exact same vote.

I think there is a pretty big generation gap when it comes to this issue. I appreciate the importance of the issue, but I am also not going to feel bad about the car I drive or my reasons for driving it. It's especially harsh when people on pensions, from a generation who actually knew the words 'job security' and 'benefits' insult me for driving what I can afford to drive. I am not saying anyone in this thread is doing that, but I actually do get crap like that from people frequently. And I can guarantee you, it does nothing to motivate anyone to buy domestic.


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## Guest (Jun 3, 2009)

torndownunit said:


> I don't share your optimism. I am likely a younger generation than you (32) and I know exactly 2 people who drive GM, Ford or Chrysler. That is, other than friends parents.
> 
> I mentioned this in another post on the topic, but they already did their damage with my generation. Back when I first started buying cars they offered NOTHING that competed with what companies like Honda and Toyota offered. Now they do, but during my early years buying cars I have owned 3 foreign cars, have been extremely happy with the vehicles and the service, and have no reason to venture to another brand. Those companies lost me as a customer a long time ago. And again, most people *I* know are in the exact same vote.


Hey, I'm your exact age and just as skeptical. I would have preferred they let it die. Out of the ashes new, more agile and forward-thinking companies would have risen. I saw it happen in the .com bust, no doubt it'd happen here.

As for damage done -- I find NA car loyalty is very town-specific. In the GTA there's little of it. Go East and you get it. Go West: not so much. Here in Ottawa it seems to be a bigger NA car town. All the siblings and sibling-in-laws drive Malibus and Impalas -- they think I'm some slacks-and-cardigan wearing weeny in my poser Pathfinder. 

Anyhow, it's planned obsolence that has and will continue you to keep me away from GM cars in particular. Bad Karma. I want none of that.


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## shoretyus (Jan 6, 2007)

iaresee said:


> Anyhow, it's planned obsolence that has and will continue you to keep me away from GM cars in particular. Bad Karma. I want none of that.


I have a problem that they always seem to elimanate their best cars. We have a Saturn has cost didlly in 300kms. Cavaliers, Acadians they went for ever. But the high end stuff that they made money on were crap. I can't look at an Olds with out thinking how many trannies they had replaced. 

Sixteen offers for Saturn .. whats that tell ya ? Somedody will make money at them. 

This is truck country. I may be odd I could never figure out who in hell came up with the brilliant design of a 6 ft box..... If I was in the market I would have hard time finding a real one. They all have had their problems and have said for years if you could take parts off all of them you could have a good one. 

Sorry I now the Toyotas and such like have a good reputation but I paid $10,000 in repairs on a Camray that we paid $10,000 for. Never again. 

No loyalty from me but I just want something that works.


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## GuitarsCanada (Dec 30, 2005)

torndownunit said:


> I don't share your optimism. I am likely a younger generation than you (32) and I know exactly 2 people who drive GM, Ford or Chrysler. That is, other than friends parents.
> 
> I mentioned this in another post on the topic, but they already did their damage with my generation. Back when I first started buying cars they offered NOTHING that competed with what companies like Honda and Toyota offered. Now they do, but during my early years buying cars I have owned 3 foreign cars, have been extremely happy with the vehicles and the service, and have no reason to venture to another brand. Those companies lost me as a customer a long time ago. And again, most people *I* know are in the exact same vote.
> 
> I think there is a pretty big generation gap when it comes to this issue. I appreciate the importance of the issue, but I am also not going to feel bad about the car I drive or my reasons for driving it. It's especially harsh when people on pensions, from a generation who actually knew the words 'job security' and 'benefits' insult me for driving what I can afford to drive. I am not saying anyone in this thread is doing that, but I actually do get crap like that from people frequently. And I can guarantee you, it does nothing to motivate anyone to buy domestic.


If they want to survive they need to change that. You are 100% correct in your evaluation of what they did to your generation. They had nothing that made a younger person want to drive their cars. When I was that age we had the Trans Am and Firebirds and Mustangs. They gave you guys the Sunbird. The future is there for the taking, just have to make it happen. Pontiac used to "build excitement" at one time.


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## Guest (Jun 4, 2009)

shoretyus said:


> I have a problem that they always seem to elimanate their best cars.


So true. The Saturn brand started off really strong too -- no haggling, etc. And they kind of fubar'ed it all up along the way. Plus, I really like the little Saturn 2 seater. And the Solstice it's based on.



> Sorry I now the Toyotas and such like have a good reputation but I paid $10,000 in repairs on a Camray that we paid $10,000 for. Never again.


I too had a Camry, an '89, that I paid all of $4k for and then poured another $4k into before I wised up and ditched it. For Toyota it's all about the truck. They make a truck that really is something else. See the Top Gear videos. 



> No loyalty from me but I just want something that works.


Ultimately that's how I shop as well. I wouldn't say I'm 100% never going to by a GM. But if I was out to buy a car today I'm feeling very Subaru lately.


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## pattste (Dec 30, 2007)

When GM closed the Boisbriand plant several years ago (where were the governments with their bags full of cash then?) the medias went to get comments from the layed off workers. Many were in tears as they were leaving the plant driving their Honda or Mazda. They didn't know how to build a good car, but they sure knew where to buy one.


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## Fader (Mar 10, 2009)

“You have no guarantee that two years down the road, they'll say: ‘Well, this Canadian factory is not up to snuff, so we've got to close it.' What are the governments going to do then?” That is what happened with GM's car assembly plant in Quebec, which received $220-million in federal and provincial interest-free loans in 1987 only to pull out of the province in 2002. None of the money has been repaid.

http://www.theglobeandmail.com/report-on-business/14-million-for-every-job-saved/article1158733/


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## torndownunit (May 14, 2006)

GuitarsCanada said:


> If they want to survive they need to change that. You are 100% correct in your evaluation of what they did to your generation. They had nothing that made a younger person want to drive their cars. When I was that age we had the Trans Am and Firebirds and Mustangs. They gave you guys the Sunbird. The future is there for the taking, just have to make it happen. Pontiac used to "build excitement" at one time.


Lol, ya exactly, the Sunbird. That car pretty much sums up everything they were doing wrong at the time. What an ugly, rusting, malfunctioning car.


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## GuitarsCanada (Dec 30, 2005)

Word is Roger Penske has purchased Saturn. There will be an announcement either later today or tomorrow sometime. Lets see what he can do with this.


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## torndownunit (May 14, 2006)

GuitarsCanada said:


> Word is Roger Penske has purchased Saturn. There will be an announcement either later today or tomorrow sometime. Lets see what he can do with this.


I heard this on the way home on the radio. It seemed like it was confirmed.


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## danbo (Nov 27, 2006)

Don't worry, I can fix it knuckleheads!


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## keeperofthegood (Apr 30, 2008)

torndownunit said:


> GuitarsCanada said:
> 
> 
> > Word is Roger Penske has purchased Saturn. There will be an announcement either later today or tomorrow sometime. Lets see what he can do with this.
> ...


As long as there is some greater sense of smart in a broke econemy than:

http://news.bbc.co.uk/2/hi/business/8087637.stm

Though, honestly, of all the GM makes, I have known people to go to odd lengths to own their Saturn. No so with any of their other cars. I am surprised that THIS would be one for their chopping block.

OH and has anyone caught their "we're not going away, we're just restructuring" commercial? I wonder how many months ago they had that one produced. I so could not stop laughing at it, such a comedy!


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## bagpipe (Sep 19, 2006)

keeperofthegood said:


> OH and has anyone caught their "we're not going away, we're just restructuring" commercial? I wonder how many months ago they had that one produced. I so could not stop laughing at it, such a comedy!


Yeah, I caught that one on the weekend. Funny indeed. (Probably funded by taxpayer dollars too!).


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## keeperofthegood (Apr 30, 2008)

bagpipe said:


> Yeah, I caught that one on the weekend. Funny indeed. (Probably funded by taxpayer dollars too!).


;p I worked on a series of commercials with a non-profit group ooo 20 years ago now. The time between writing, approval of writing, to casting, approval of casting, test shots, approval of test shots/re-write, to full shoot, to edit, to re-shoot, to re-edit, to approval, back to re-shoot to shave 2 seconds (the spot was 10 seconds and at that point we were at 12), to the final approval to the slotting on TV to airing was 9 months.

It was a fricken baby as we all went around saying of the spots.

:wave: Yes, probably a fair few tax dollars at work in their commercial promising BETTER fuel economy  <-- Lyk WTF Batman, what wur u selling b4! (unless they do something REALLY sneaky. Like, add up ALL their vehicles economies and average and then do so again WITHOUT the Hummer in the equation, then say "see, we have overall improved our fuel economy.)


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## GuitarsCanada (Dec 30, 2005)

So GM entered the tunnel and now they emerged on the other side a lot leaner. Let's see where they take this thing now. I see they have retained the services of Bob Lutz. He is getting pretty long in the tooth and 77 but we will see if he has any gas left in the tank.


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## Starbuck (Jun 15, 2007)

I don't get it though, and maybe I'm having a brain cramp, but how can you be bankrupt one moment and not the next?


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## GuitarsCanada (Dec 30, 2005)

Starbuck said:


> I don't get it though, and maybe I'm having a brain cramp, but how can you be bankrupt one moment and not the next?


It's all about Chapter 11. When you file bankruptcy under chapter 11 that is a "re-organization". Essentially you enter this with the full intentions of coming out of it. It is a way for a court to decide who is going to get paid and which assets can be sold etc etc. GM went in owing almost 200 billion in debt. They are coming out somewhere around 48 billion. Most of that owed to the US and Canadian Gov as well as some to the pension fund. 

So they are shedding a ton of debt as well as losing product lines and over capacity. They are emerging with Chev, Buick, GMC and Cadillac. Thats all there will be going forward. They are shedding another 6000 white collar and closing 16 more plants. The bottom line for them is they will be able to operate at a profit for the first time in years.


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## Milkman (Feb 2, 2006)

GuitarsCanada said:


> It's all about Chapter 11. When you file bankruptcy under chapter 11 that is a "re-organization". Essentially you enter this with the full intentions of coming out of it. It is a way for a court to decide who is going to get paid and which assets can be sold etc etc. GM went in owing almost 200 billion in debt. They are coming out somewhere around 48 billion. Most of that owed to the US and Canadian Gov as well as some to the pension fund.
> 
> So they are shedding a ton of debt as well as losing product lines and over capacity. They are emerging with Chev, Buick, GMC and Cadillac. Thats all there will be going forward. They are shedding another 6000 white collar and closing 16 more plants. The bottom line for them is they will be able to operate at a profit for the first time in years.



They're "shedding" their debt onto the backs of the tax payers and investors.


That 200 billion in debt didn't evaporate.

I've always had a problem with the ability of a company to declare bankruptcy and then start right back up with no responsibility to those who were owed money.

On a smaller scale I've seen this done in bars. The same bar has opened three or four times with the same owner, under different names and each time the only folks who got screwed were suppliers.

Oh well. That's the way the cookie crumbles I guess.


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