Phil LeBeau; Finger On The Pulse...

[longtooth]

So once again, in my opinion, Phil LeBeau distills GM's 'situation' down into it's essence..

[the article]

Saving GM: Inside the Crisis, Automobile Industry, Bailout, Business, Manufacturing

Behind the Wheel - Phil Lebeau

Talk about a re-structuring.

In one full swoop, the White House has made it clear it will re-make America's largest auto maker from the top down.

This goes way beyond dumping the CEO of a company gasping for air.

This is the start of the Treasury Department actively changing who and how GM operates.

So what happens next for GM?

Here's my take on the biggest questions swirling around GM.

- Wagoner out/Henderson in

The White House asked GM chairman and CEO Rick Wagoner to step down. Call him a political sacrificial lamb if you want, but the White House is sending a strong message that GM needs a new approach, new ideas, and new leadership. Fritz Henderson has long been considered Wagoner's heir apparent so his move to the top job is not a surprise. He's also a long time GM executive who was the architect of the company's recent restructuring plans. It brings up the question as to whether he is an interim CEO to get GM through this re-structuring or if he will keep the job long term.

- How active will the White House be in re-shaping GM?

Very active. Put it this way, the White House says it will have people in Detroit working to make GM leaner, more efficient, and likely a more conservative company. Don't be surprised if GM cuts more plants and sheds even more brands as Washington strips this company down to a more manageable, and hopefully, more profitable level.

- Will GM go into bankruptcy?

Maybe. The White House says it may consider a "quick rinse" pre-packaged bankruptcy that would let the government use the bankruptcy code to eliminate costly liabilities. That's code for Washington telling GM bond holders, "You better agree to cut the company's debt even further or we'll force that to happen in bankruptcy court." There is a lot of saber rattling in that threat aimed at GM bond holders, but it is also a very real threat.

- Will GM become smaller?

Probably. I expect the White House to pursue a Toyota-type strategy (similar to what Ford is doing) of paring the company down to three brands (Chevy, Cadillac, GMC) and focusing on a more limited line-up of vehicles. Also, the government will back GM developing more fuel efficient models like the Chevy Volt.

[end quote]

http://www.cnbc.com/id/29954963/site/14081...C&par=yahoo

[FUTURE_OF_GM]

Too bad I'm not interested in buying any of those 3 brands...

And I don't really see what the number of brands has to do with anything, anyway.

GM is not Toyota and it will never succeed as Toyota.

[PurdueGuy]

The people cry about how inefficient, inept, and corrupt the government is. I know, let's have them also run our auto industry! They'll do a great job! (Same applies to healthcare, etc.)

[Robert Hall]

Too bad I'm not interested in buying any of those 3 brands...

And I don't really see what the number of brands has to do with anything, anyway.

GM is not Toyota and it will never succeed as Toyota.

Well, it's certainly not been remotely succeeding as GM with it's traditional brand structure in recent years...

In the past decade, GM has lost double-digit percentages of market share, billions and billions of dollars, and a huge amount of stock price...

Edited March 30, 2009 by moltar

[CaddyXLR-V]

Well, it's certainly not been remotely succeeding as GM with it's traditional brand structure in recent years...

In the past decade, GM has lost double-digit percentages of market share, billions and billions of dollars, and a huge amount of stock price...

I think GM missed the deadline of when they needed to restructure to become a viable business, and it was about 20 years ago. After that point, anything GM did right would only slow the decline.

[Robert Hall]

I think GM missed the deadline of when they needed to restructure to become a viable business, and it was about 20 years ago. After that point, anything GM did right would only slow the decline.

They did a restructuring under Rodger Smith 25 years ago, Chevy/Pontiac/Canada, Buick/Olds/Cadillac, Truck& Bus. That didn't seem to be successful.

I started reading a new book yesterday--- 'GM: Why it Matters'...about 50 pages in, I've seen a few errors, but so far it's an interesting read.

[CaddyXLR-V]

They did a restructuring under Rodger Smith 25 years ago, Chevy/Pontiac/Canada, Buick/Olds/Cadillac, Truck& Bus. That didn't seem to be successful.

I started reading a new book yesterday--- 'GM: Why it Matters'...about 50 pages in, I've seen a few errors, but so far it's an interesting read.

Well, I meant a successful restructuring. I honestly think it's too late, and anything GM does now wont help, short of ch 11 bankruptcy, or some other govt forced reduction in costs.

[FUTURE_OF_GM]

And I really don't see why GM would go with a Chevrolet, GMC, Cadillac set up... I honestly don't ever see them giving up their 4 core brands in america, as GMC and Buick essentially constitute one division and both have a damn good case for survival. I'm sure Pontiac will be thrown out with the trash though..

Even *IF* GM went down to 3 division, Buick with it's global presence and more unique product possibilities would certainly win out over GMC.

[Robert Hall]

And I really don't see why GM would go with a Chevrolet, GMC, Cadillac set up... I honestly don't ever see them giving up their 4 core brands in america, as GMC and Buick essentially constitute one division and both have a damn good case for survival. I'm sure Pontiac will be thrown out with the trash though..

Even *IF* GM went down to 3 division, Buick with it's global presence and more unique product possibilities would certainly win out over GMC.

Yeah, GMC just seems completely redundant...all it's models have Chevy, Saturn, and Buick equivalents.

At this point, I'm not sure how to save GM besides Chapter 11... and even that, what will come out of it?

[daves87rs]

The real question is, Outside detroit, is any one besides a few car nuts going to even notice that other brands are even gone?

I'm guessing not...

[Robert Hall]

The real question is, Outside detroit, is any one besides a few car nuts going to even notice that other brands are even gone?

I'm guessing not...

Very few outside of the Midwest, I would think. So many car buyers in the mainstream today are content w/ the modern 'Big 3' brands--Hondas, Toyotas, Nissans...not to mention all the other Japanese brands, the Koreans, Volkswagen, etc.. if GM goes into Chapter 11, who besides the faithful will seriously consider buying from them?

Edited March 31, 2009 by moltar

[Chicagoland]

All the middle price brand fans have to wake up and 'smell the coffee'. GM failed at trying to keep all the nostolgic brands around to please dealers and loyalists [who end up getting used cars anyway].

"I'm not interested in those 3 brands", well the rest of the world has moved on from the outdated "My Pontiac is better", even tho its the same $@$@!# car!

[daves87rs]

Very few outside of the Midwest, I would think. So many car buyers in the mainstream today are content w/ the modern 'Big 3' brands--Hondas, Toyotas, Nissans...not to mention all the other Japanese brands, the Koreans, Volkswagen, etc.. if GM goes into Chapter 11, who besides the faithful will seriously consider buying from them?

Not many..and sadly, I already know a few diehard GM fans who gave up and moved on...

[Robert Hall]

Not many..and sadly, I already know a few diehard GM fans who gave up and moved on...

Ya...I know a couple of serial (over 20 years) GM owners that have moved on in the last 2 years...both married, around 40, originally Midwesterners... one guy that had had a Grand Prix, a couple Camaros, a Blazer, a Trail Blazer, now has an Eclipse and a Pilot. Another that had a couple Cutlasses and most recently an Intrigue and a Silhouette now has an Accord and an Odessey. Sad.

[balthazar]

GM will not survive Chap 11. The perception that they have railed against for x-number of years will smother the Corp completely, and the only exit will be Chap 7.

[CaddyXLR-V]

All the middle price brand fans have to wake up and 'smell the coffee'. GM failed at trying to keep all the nostolgic brands around to please dealers and loyalists [who end up getting used cars anyway].

"I'm not interested in those 3 brands", well the rest of the world has moved on from the outdated "My Pontiac is better", even tho its the same $@$@!# car!

What is my GTO the same as again? Or the G8 the same as? GM did fail, and it was because they didn't try. It was because they decided to spend billions on Saturn to start it, and more recently with a brand new lineup, whos sales have yet to reach Pontiacs.

[SAmadei]

Ya...I know a couple of serial (over 20 years) GM owners that have moved on in the last 2 years...both married, around 40, originally Midwesterners... one guy that had had a Grand Prix, a couple Camaros, a Blazer, a Trail Blazer, now has an Eclipse and a Pilot. Another that had a couple Cutlasses and most recently an Intrigue and a Silhouette now has an Accord and an Odessey. Sad.

Interesting, so one burned by the departure of Olds... one halfway burned due to the loss of coupes. Can't explain the Blazer->Pilot thing... unless they didn't want to buy the same old 25 year old design for a third time.