"GM Will Rise Again"

[z28luvr01]

Source: Newsday

President Barack Obama pushed General Motors Corp. into bankruptcy on Monday and said it was part of a "viable achievable plan that will give this iconic company a chance to rise again."

Obama said he hoped the firm would emerge quickly from bankruptcy court, and said the government was ready to commit an additional $30 billion to help the company get on its feet.

He said the government would own 60 percent of the new GM, and acknowledged that could prove controversial with some.

Seeking to ease those concerns, Obama said, "What I am not doing, what I have no interest in doing, is running GM."

"Our goal is to help GM get back on its feet ... and get out quickly," he said of the federal government.

Obama spoke as GM entered bankruptcy court at the same time Chrysler was looking to emerge after a two-month reorganization.

Over the weekend, a bankruptcy judge gave the No. 3 automaker approval to sell most of its assets to Italy's Fiat, part of a plan under which the U.S. government will own somewhat less than 10 percent of the firm.

Ford Motor Co., the other large U.S. automaker, has said it can weather the current economic and industry crises on its own.

Under the GM plan envisioned by Obama's auto industry taskforce, the federal government will wind up with 60 percent ownership in the one-time pillar of American capitalism.

That comes in addition to its smaller stake in Chrysler, as well as significant interests in banks, insurance giant AIG and two mortgage industry giants, Fannie Mae and Freddie Mac.

Speaking at the White House, where he was flanked by Cabinet secretaries and economic advisers, Obama said the coming restructuring will "take a painful toll on many Americans" with the closure of additional plants and the loss of jobs.

The president did not pause to answer questions, but Republicans had plenty.

"The only thing it makes clear is that the government is firmly in the business of running companies using taxpayer dollars," said House Republican Leader John Boehner of Ohio.

"Does anyone really believe that politicians and bureaucrats in Washington can successfully steer a multinational corporation to economic viability? It's time for the administration to fully explain what the exit strategy is to get the U.S. government out of the board room once and for all," Boehner said.

[z28luvr01]

Seeking to ease those concerns, Obama said, "What I am not doing, what I have no interest in doing, is running GM."

Hopefully this quote puts all rumors about the death of everything cool and fun to rest.

[Justin Bimmer]

What? the government is not going to run GM?

[Intrepidation]

Yeah, if people would actually watch/read credible news and not every harebrained article that some attention whore writes, the government has stated repeatedly it doesn't want to run Chrysler or GM. t wants them restructured and released ASAP.

[FAPTurbo]

What's this?! Republican's demanding an exit strategy for something!?

My brain cannot process the irony.

[G. David Felt]

Yup let them run wild without the baggage of past responsibility. We will watch to see if they learned from the past so they can move forward without truly dying.

I do believe that GM will not only survive, but grow and come back as a much superior company.

[Justin Bimmer]

Wait.................

So the government is NOT going to run them?

[A Horse With No Name]

Actually this should "clean up" much quicker than the partial nationalization of railroads under Conrail, methinks.

It will still however be painful.

Chris

[CaddyXLR-V]

Hopefully this quote puts all rumors about the death of everything cool and fun to rest.

The government said it wouldn't do a lot of things when they injected capital into banks, but that proved to be untrue. I'll believe it when I see it.

[ZL-1]

Yummy picture!

Seriously... the filing entered today, and plenty of deals were struck before the filing was delivered. President Obama said what he was supposed to say, what a President in office was supposed to say given the circumstances. Let's give it some time and see how the bankruptcy judge and all parties involve handle this... say a month or two.

Edited June 1, 2009 by ZL-1

[Teh Ricer Civic!]

.gov has too much of a reputation for saying things are temporary and then never getting rid of them for me to believe this until i see it.

[Z-06]

Yummy picture!

Seriously... the filing entered today, and plenty of deals were struck before the filing was delivered. President Obama said what he was supposed to say, what a President in office was supposed to say given the circumstances. Let's give it some time and see how the bankruptcy judge and all parties involve handle this... say a month or two.

I still will repeat this, GM went into bankruptcy not completely because of itself, but partially because of the economic environment. GM had made great efforts to clean its crap up over the past 4 years. What it could not do is clean the UAW and dealers which were the real albatrosses, bankruptcy will make it stronger. There will be opposition, but hopefully it won't be as strong as Chrysler because of all those negotiations.

[CaddyXLR-V]

I still will repeat this, GM went into bankruptcy not completely because of itself, but partially because of the economic environment. GM had made great efforts to clean its crap up over the past 4 years. What it could not do is clean the UAW and dealers which were the real albatrosses, bankruptcy will make it stronger. There will be opposition, but hopefully it won't be as strong as Chrysler because of all those negotiations.

I still blame GM. They had 30 years to get their act together. Did they think there would never be another recession?

[Camino LS6]

Obama may not want to run GM, but Congress won't be able to resist.

GM had better move fast, faster than it ever has...

[Z-06]

I still blame GM. They had 30 years to get their act together. Did they think there would never be another recession?

Past is the past no one can correct it, but failing to accept it and moving on is another stigma. What is important are the strides GM took restructuring almost 4 years ago after accepting the failures and putting efforts in bringing in the right products. Large companies with complicated labor contracts and dealer agreements cannot be changed overnight, but the insight was there. Yes GM had looked at the scenario of recession and had made its business plans for a market of 12M vehicles, not 10M vehicles which we saw, that is when everything went wrong. Just ask Toyota, despite of its so called efficiency, it still managed to post a bigger quarterly loss than the company teetering on bankruptcy. Oh, and what about Porsche was it mismanaged for 30 years too?

[CaddyXLR-V]

Past is the past no one can correct it, but failing to accept it and moving on is another stigma. What is important are the strides GM took restructuring almost 4 years ago after accepting the failures and putting efforts in bringing in the right products. Large companies with complicated labor contracts and dealer agreements cannot be changed overnight, but the insight was there. Yes GM had looked at the scenario of recession and had made its business plans for a market of 12M vehicles, not 10M vehicles which we saw, that is when everything went wrong. Just ask Toyota, despite of its so called efficiency, it still managed to post a bigger quarterly loss than the company teetering on bankruptcy. Oh, and what about Porsche was it mismanaged for 30 years too?

GM has been restructuring for the past 20 years. It has ALWAYS been, wait until the next gen of vehicles come out. It was only a matter of time before the next recession came. GM didn't have it's house in order when that recession came. While the current management can't be blamed 100%, GM as a company can, because it let itself get to the position it was in over many decades.

[CaddyXLR-V]

Porsche and Toyota still had enough cash put aside to withstand the recession. GM didn't.

[MRDETROITMETAL]

AHHH, well ya know it worked back in the day with Chrysler....but NOW even Iaccoca has LOST His Pension !!!....I still think GM is running the show, but....the "little guy" is gonna get it up the A## on this deal...again. America Lost it bY NOT stepping up to PROVIDE for Pension & Healthcare costs 10 years ago, (LIKE IMPORT GOVERNMENTS DO) & giving away factories, jobs & Tax free incentives to Import companies, while NOT allowing Detroit the Same advantages....the bill has come DUE, ...NOW WE ARE GONNA PAY.

Edited June 1, 2009 by MRDETROITMETAL

[Z-06]

GM has been restructuring for the past 20 years. It has ALWAYS been, wait until the next gen of vehicles come out. It was only a matter of time before the next recession came. GM didn't have it's house in order when that recession came. While the current management can't be blamed 100%, GM as a company can, because it let itself get to the position it was in over many decades.

True about 20 years, but the results were there after the major restructuring in 2006/7 when GMNA actually made profit in two consecutive quarters despite of write downs and not counting any sales of assets. The management has/were giving serious thoughts on product portfolio and majority have been hits than duds contrary to what it was in the past. GM got in the mess 5 years ago from the mess that was created 30 years ago. But the current mess it is in cannot be blamed on GM alone because GM actually made efforts to get out of the mess.

[Z-06]

Porsche and Toyota still had enough cash put aside to withstand the recession. GM didn't.

Yeah that is why Volkswagen and German government gave money under the table to Porsche and Japanese government handed Toyota 25B through the veil of Toyota's financing arm.

[G. David Felt]

Yeah that is why Volkswagen and German government gave money under the table to Porsche and Japanese government handed Toyota 25B through the veil of Toyota's financing arm.

That is so Freaking True!

[CaddyXLR-V]

Yeah that is why Volkswagen and German government gave money under the table to Porsche and Japanese government handed Toyota 25B through the veil of Toyota's financing arm.

I have no respect for Toyota anyway, and it still amazes me that their cars top the sales charts over superior cars.

Porsche is understandable(though this is the first time I have heard of that), because they are a small vehicle line operating independently offering luxury vehicles during a recession.

My point is, GM should have never let itself get into a position of weakness, coming from being the largest auto maker in the world. They should have adapted with the times in 1970. Toyota may never have become as big as it is today if GM would have corrected it's problems early on, instead of sweeping them under the rug for managers years later to deal with.

[Teh Ricer Civic!]

Porsche is understandable(though this is the first time I have heard of that), because they are a small vehicle line operating independently offering luxury vehicles during a recession.

Yep, its always a brilliant idea to bail out people who got a little over zealous with their risk taking... That's how you teach companies to be responsible!

[Z-06]

I have no respect for Toyota anyway, and it still amazes me that their cars top the sales charts over superior cars.

Porsche is understandable(though this is the first time I have heard of that), because they are a small vehicle line operating independently offering luxury vehicles during a recession.

My point is, GM should have never let itself get into a position of weakness, coming from being the largest auto maker in the world. They should have adapted with the times in 1970. Toyota may never have become as big as it is today if GM would have corrected it's problems early on, instead of sweeping them under the rug for managers years later to deal with.

That is the curse of being #1, you start thinking everything is trivial even if it is a line of ants entering your giant fortress. The most important thing is that it is never too late to mend, and GM was making an effort to mend, but it could not mend labor and dealers beyond a certain point without getting into a big mess. Bankruptcy is the perfect way it can get rid of those two, so GM bankruptcy is in someways blessing in disguise and should not be considered terrible as people think out or make it out to be.

[Z-06]

Porsche is understandable(though this is the first time I have heard of that), because they are a small vehicle line operating independently offering luxury vehicles during a recession.

The fact that amazes me is the stakes are so high in this automobile game that country like Germany wants to protect a small manufacturer in volume, yet our country wants to get rid of the World's #2 auto manufacturer.

[CaddyXLR-V]

Yep, its always a brilliant idea to bail out people who got a little over zealous with their risk taking... That's how you teach companies to be responsible!

Well I haven't heard anything about it. The last I remember reading about Porsche was that they made $8B last year by manipulating their ownership in VW.

How much did they receive from the German govt?

Also, I see nothing wrong with VW giving money to Porsche. They have close ties, with Porsche owning a significant stake in VW, and share technology. Isn't Porsche also upping their stake in VW to above 51%?

[Z-06]

Well I haven't heard anything about it. The last I remember reading about Porsche was that they made $8B last year by manipulating their ownership in VW.

How much did they receive from the German govt?

Also, I see nothing wrong with VW giving money to Porsche. They have close ties, with Porsche owning a significant stake in VW, and share technology. Isn't Porsche also upping their stake in VW to above 51%?

Here it is.

I cannot translate the German article.