GM posts $9.6B 4Q loss

[DBeaSSt]

http://apnews.myway.com/article/20090226/D96J8RGG0.html

GM posts $9.6B 4Q loss, burns through $6.2B cash

Feb 26, 7:40 AM (ET)

By TOM KRISHER and KIMBERLY S. JOHNSON

DETROIT (AP) - General Motors Corp. (GM) (GM) posted a $9.6 billion fourth-quarter loss and said it burned through $6.2 billion of cash in the last three months of 2008 as it fought the worst U.S. auto sales climate since 1982 and sought government loans to keep the century-old company running.

The nation's biggest domestic automaker said Thursday it lost $30.9 billion for the full year and expects an opinion from its auditors as to whether the company remains a "going concern" when its annual report is issued in March. That means the auditors will determine whether there is substantial doubt about the automaker's ability to continue operations.

Chief Financial Officer Ray Young said the determination will depend a lot on whether GM gets further government loans and whether it can accomplish its restructuring goals.

The company has received $13.4 billion in federal loans since Dec. 31 and says it needs up to $30 billion to stay out of Chapter 11 bankruptcy protection. Top GM executives were in Washington, D.C., Thursday to meet with the Obama administration's auto task force to talk about restructuring and additional loans.

"2008 was an extremely difficult year for the U.S. and global auto markets, especially the second half," Chairman and CEO Rick Wagoner said in a statement. "These conditions created a very challenging environment for GM and other automakers and led us to take further aggressive and difficult measures to restructure our business."

GM reported a net loss of $15.71 per share for the fourth quarter, compared with a loss of $722 million, or $1.28 per share in the year-ago period.

Quarterly revenue fell 39 percent to $30.8 billion from $46.8 billion, as credit availability froze across the globe, and a lack of consumer confidence and fears of job losses kept people from buying vehicles.

Excluding special items, GM's fourth-quarter adjusted loss was $5.9 billion, or $9.65 per share.

That was worse than Wall Street expected. Analysts surveyed by Thomson Reuters predicted a quarterly loss of $7.40 per share on sales of $35.1 billion.

For the full year, the loss was $53.32 per share, the second-worst annual result in the company's history. The worst loss occurred in 2007, when GM lost $38.7 billion, or $68.45 per share, in 2007, due largely to charges for unused tax credits.

GM shares fell 22 cents, or 8.6 percent, to $2.33 in premarket activity.

[FUTURE_OF_GM]

What's that I hear??!?

I think it's the wheels falling off.

[buyacargetacheck]

GM only earned about $47 Billion between 1994-2004. Those were good solid profitable years, the height of the SUV craze. We've heard "loan" numbers like $100B needed before GM is back on its feet either through bankruptcy or federal assistance. Clearly, GM is not viable and hasn't been in quite some time. It had a loss 3 straight years prior to the credit crisis. No, at this point it's all about national politics: preserving jobs in a depression and restructuring American industry.

[6t5frlane]

How long can GM and Chrysler hang on. I hope you all like Fords. Sad very sad

[ZL-1]

Things appear so good for GM right now that leftlanenews was speculating the DT7 would go on EpsilonII. Now that's what I call 'Standard of the World EXCITEMENT!!!!!!!!!' :rotflmao:

[daves87rs]

Not looking good.

[daves87rs]

What's that I hear??!?

I think it's the wheels falling off.

Wheels? It's the roaring flames you hear....

[carman21]

One can only hope that GM is spending most of this on great new products.

Three years of losses are more likely the results of pay down obligations and a massive investment in product development. In the last three years, GM has come out with more great cars and other vehicles than GM has produced in over 30 years if not 60 years. By 2012, if GM is able to survive, it will with TARP access, GM will have the best products out there.

[turbo200]

GM only earned about $47 Billion between 1994-2004. Those were good solid profitable years, the height of the SUV craze. We've heard "loan" numbers like $100B needed before GM is back on its feet either through bankruptcy or federal assistance. Clearly, GM is not viable and hasn't been in quite some time. It had a loss 3 straight years prior to the credit crisis. No, at this point it's all about national politics: preserving jobs in a depression and restructuring American industry.

though your point is well taken, the situation with renegotiating contracts, the bond swaps, etc should leave GM in a position to be really profitable. if they make it.

[buyacargetacheck]

Even if GM is able to negotiate the debt down to a manageable level it'll be a much smaller company operating with much less demand industry-wide. And the products in demand will be small cars or alt fuel cars with little to no margin. Meanwhile GM is on track to borrow something like $39B from the Feds. If GM becomes as profitable as it was in the 90s (which it won't for said reasons) it would take them 10 years to pay the government back. Imagine if they end up borrowing $100B!!! BTW, the payback time assumes none of the profits would be injected back into capital investment. Nor does it account for debt service.

Believing that GM in its present form can become a viable business is at best faith-based. At worst, delusional.

though your point is well taken, the situation with renegotiating contracts, the bond swaps, etc should leave GM in a position to be really profitable. if they make it.

[vonVeezelsnider]

Time for a backed Chapter 11 Filing and the hope that they can pare themselves down to something viable... if not I guess I'll have to get used to the idea of buying Fords...

[FUTURE_OF_GM]

Time for a backed Chapter 11 Filing and the hope that they can pare themselves down to something viable... if not I guess I'll have to get used to the idea of buying Fords...

Meh...

The persecution won't stop with GM. The media and "street" tried to break Ford a few years ago (unsuccessfully) and seriously weakened it. (ironically, or not, on THEIR centennial)

Once Chrysler is liquidated and GM is man handled to where Ford is now, the new focus will be on finding cracks in Ford's armor and executing a tirade of negativity on them.

Even now, the "positive" media that Ford gets for not receiving government aid is BEGRUDGING at best. All the while, the media continues to include them in the over all "bailout" agenda and continues to FOIST Toyota and Honda as 'hero' companies that started from nothing and are "losing out because [supposedly] they get no government support"

[Satty]

Have you bothered reading anything in the media about the new Fords? Every article I've read regarding the new Fusion and Taurus have made it sound as if those cars are the second coming. Go flip through the March issue of Automobile, they rave over the Taurus, and commend Ford on being in the best financial situation of the Big 3. One of the mags (I dont recall which) was gushing over the Fusion hybrid as well.

Edited February 27, 2009 by Satty

[vonVeezelsnider]

Have you bothered reading anything in the media about the new Fords? Every article I've read regarding the new Fusion and Taurus have made it sound as if those cars are the second coming. Go flip through the March issue of Automobile, they rave over the Taurus, and commend Ford on being in the best financial situation of the Big 3. One of the mags (I dont recall which) was gushing over the Fusion hybrid as well.

I like that new Lincoln MKS too...

[G. David Felt]

I will pass on the Fix or Repair Daily auto's. Too Small, Plasticy ineriors and not up to par.

Back on Topic, I really hope that GM does make the major changes and cuts they need and get the loans to survive. It would be a sad day to have the General go Bankrupt.

[Satty]

Really, you've already sat in the 2010 Taurus and Fusion?

[G. David Felt]

Really, you've already sat in the 2010 Taurus and Fusion?

--------------------------

Nope, Sat in the 2009 models on the ford lot here in Kirkland WA, looked at the pics of the 2010 and still not impressed with ford products. Only ford I ever owned was the only one built by Mazda for Ford, their 1991 Ford Escort GT. That was a hot little number and then the next year they dumb it down due to complaints from the insurance industry.

But still not impressed with the ford products. Even the latest Ford Mustangs I looked at still are not that great, especially when they have rust all over them. Just helped my wifes Boss buy his new Expedition XL or what ever they called the longer version. Much nicer than his 97 Expedition he had but not as nice as my GMC or Escalade. Only thing I will give them points for is the fold down seats into the floor on the 3rd seat option. That GM should have done from the begining.

But back on Topic, The Cash that GM is burning has to stop, they have got to make the hard decisions and not drag out the end results. Cut and kill product lines now even my loved Hummer line. Kill em and move forward with what can really survive in todays economy.

[ShadowDog]

I will pass on the Fix or Repair Daily auto's. Too Small, Plasticy ineriors and not up to par.

You know, that saying has been around almost as long as people have been complaining about GM's lacklustre quality and plastic interiors as well.

IMHO, it's attitudes and old-school thinking from, both, consumers and the media that has held GM back as they claw their way out of the pit they dug for themselves. The only problem is with each milestone of progress they reach, a previous negative one keeps jumping out to bite them in the ass; and not by having a vehicle out that continues to have the same sub-par standards, but by constantly bringing up the memory of them. It's been said that GM could build the best car ever seen for the cheapest price possible and they still would have some dorks from the media say, "Who'd have thunk the car maker responsible for the [insert $h!-car here] could make this!" If we look at the many examples today of what would seem to be the best output from the Big3 (disregarding the questionably designed exteriors for some) in... well, ever, then what the heck are people smoking?

...and no, not everything has to be the best performing, most exciting, eye-popping designed and engineered vehicle each and every time; however, the masses are far too critical these days. It's unfortunate that the Big3 were finally in the groove to changing these preconceived notions. Either that, or these lousy consumers and auto journalists have been kicking the bucket. Maybe enough of them haven't died for the domestic-front to see their way out of this mess.

[GXT]

Meh...

The persecution won't stop with GM. The media and "street" tried to break Ford a few years ago (unsuccessfully) and seriously weakened it. (ironically, or not, on THEIR centennial)

Once Chrysler is liquidated and GM is man handled to where Ford is now, the new focus will be on finding cracks in Ford's armor and executing a tirade of negativity on them.

Even now, the "positive" media that Ford gets for not receiving government aid is BEGRUDGING at best. All the while, the media continues to include them in the over all "bailout" agenda and continues to FOIST Toyota and Honda as 'hero' companies that started from nothing and are "losing out because [supposedly] they get no government support"

It is a strange coping method to blame everything on the media. Do you do that when you spill the milk? Stub your toe?

You know who is losing out because of government support? Ford.

Ford HAS been broken for quite some time and there are lots of reasons for that, the least of which is the media. All they've got going for them is they took out a HUGE loan (15 billion???) while they still could. They are chewing through the cash and will be in GM's position shortly.

Maybe if GM/Chrysler were allowed to go under then Ford could survive.

[FUTURE_OF_GM]

Have you bothered reading anything in the media about the new Fords? Every article I've read regarding the new Fusion and Taurus have made it sound as if those cars are the second coming. Go flip through the March issue of Automobile, they rave over the Taurus, and commend Ford on being in the best financial situation of the Big 3. One of the mags (I dont recall which) was gushing over the Fusion hybrid as well.

It's pretty obvious that I was NOT referring to product reviews.

It is a strange coping method to blame everything on the media. Do you do that when you spill the milk? Stub your toe?

I don't balme everything on them media. I merely make sure that people know how they affect things. And if you think they don't affect every aspect of the situation, we as a country, are in today then you're living under a rock.

I don't "cope" with anything... I saw the writing on the wall 3 years ago. (Read my posts from then when I was predicting the downfall of the big 3 as well as the downfall of this country)