General Motors Death Watch 60: Bankruptcy is Good

[Intrepidation]

3 March 2006

By Robert Farago

It’s official: bankruptcy is good for GM. In their recent ass-covering exercise for the Securities and Exchange Commission (SEC), The Ford Motor Company listed "adverse effects from the bankruptcy or insolvency of a major competitor" as a significant risk to its financial future. Translation: if GM goes bankrupt, The General will slough off its excessive labor costs and become… wait for it… competitive. So competitive, in fact, that Ford reckons GM’s products would gain an important price advantage. Well how about that?

Obviously, there’s more to it than that. Ford’s SEC filing also alerts investors that GM’s Chapter 11 could destroy The Blue Oval’s supply chain. Both automakers share a large number of mission critical parts suppliers; if GM’s submersion sucks vital parts makers into bankruptcy-- which it most assuredly would-- Ford will lose access to the bits and pieces it needs to build Fords. In fact, it’s hard to see how Ford could survive a GM bankruptcy. Or why it would want to. The automotive community is slowly (and quietly) beginning to conclude that bankruptcy is both the only thing and the BEST thing that can happen to GM, and, by extension, Ford.

To review: GM can’t build competitive vehicles at a profit. It’s got too many models, brands and dealers. Too much bureaucracy, waste and inefficiency. Its labor costs are too high, its capital investment is too low and its supply chain is about to snap. And GM can’t change a thing. The United Auto Workers (UAW)’s contract prevents any wage or benefits cuts, and precludes any alteration to their Byzantine working practices. Legal obligations also stop GM from trimming its distended dealer network or euthanizing fatally wounded brands. To survive, GM needs to lower its costs and revamp its business. And it can’t do that without Chapter 11.

Oh, OK, it could, if everyone pulled together: investors, management, unions, dealers, suppliers and customers. But they won’t. It’s not in their nature. And even if it was, GM CEO Rabid Rick Wagoner is singularly incapable of tackling this monumental leadership assignment. And even if Rabid Rick could unify all the negatively charged particles in the GM universe, it’s too late. The General doesn’t have enough cash to weather the turbulence between business-as-usual and the end result of a lengthy, radical, difficult and dangerous overhaul. Nobody’s going to give them the extra money-- at least until The General declares bankruptcy. As Ford publicly acknowledged, only bankruptcy can give GM the wiggle room it needs to implement necessary changes to the way it designs, builds, markets and sells its products.

So be it. As I said at the beginning of this odious odyssey, GM will emerge from this multi-decade debacle a smaller, leaner and better automaker or, preferably, automakers. And that’s why Ford’s worried. Of course, they’re not the only ones. The prospect of revolutionary change is making everyone involved apprehensive, frightened, angry, defensive, aggressive, desperate and, well, crazy. We’re already seeing some strange behavior emerge from GM World: a public pledge to end to discounts followed by a “March madness” incentive campaign, exciting new cars announced and cancelled and re-announced; a Board Member and Car Czar squabbling over a moribund Swedish car brand, etc. It’s the End of Days, Detroit style.

As GM’s fate reaches its terrifying conclusion, workers will get all the attention. The moment the axe falls, whether by a slow strike or a lightning default, the spotlight will shift to “the little guy.” Needless to say, the media will depict them as victims. They’ll highlight the most desperate cases and blame their fate on management incompetence, outsourcing, the Japanese, the Chinese, foreign trade policy, currency manipulation, oil prices, George W. Bush, the anti-GM press, anyone and anything other than the workers themselves. Never mind that a huge number of these workers performed two hours work for eight hours pay. Never mind that thousands were willing to receive full pay and benefits for doing nothing whatsoever. It will always be someone else’s fault.

Understand this: GM’s workers are no better or worse than any of the other players in this sad saga. All of them work for a company where personal responsibility doesn’t exist. Where everyone thinks they deserve to be well-paid, no matter what they or the company does, or doesn’t do. Yes, there are plenty of good people within GM. And here’s the kicker: most of them can’t wait for the company to file. They want to see an end to the waste, laziness, greed, corruption, inequality and stupidity they see around them. When GM becomes the world’s largest bankrupt, these good men and women will be satisfied, knowing that there is justice in the world. And they’ll be hopeful; that something good will replace something bad.

from The Truth About Cars

--

So what does evryone think of this article? Some things make sense, some I dunno. I just came across this while looking at car reviews, heh.

Edited March 5, 2006 by Dodgefan

[Croc]

Nah...there are other ways for this to happen that don't involve bankruptcy.

[Simon C]

The United Auto Workers (UAW)’s contract prevents any wage or benefits cuts, and precludes any alteration to their Byzantine working practices.

Sorry Brunno, but your wrong. The UAW has and still is working with GM to reduce costs. We (the UAW) just saved GM 15 billion over the next few years by having our retirees pay for their Healthcare, and current workers gave up pay increases and COLA, that we had coming in the near future. And, they (the UAW) is still working with GM and Delphi to get that thing settled.

I'm just tired of reading people saying that the UAW isn't doing anything. It just isn't true.

[Ghost Dog]

Sorry Brunno, but your wrong. The UAW has and still is working with GM to reduce costs. We (the UAW) just saved GM 15 billion over the next few years by having our retirees pay for their Healthcare, and current workers gave up pay increases and COLA,  that we had coming in the near future. And, they (the UAW) is still working with GM and Delphi to get that thing settled.

I'm just tired of reading people saying that the UAW isn't doing anything. It just isn't true.

The Retiree Healthcare thing is likely to be thrown out in court.

Leroy McKnight is one of hundreds of UAW retirees expected to appear Monday in federal court in Detroit to voice their opposition to a deal between their union and General Motors Corp. that would force them to pay more for health care.

McKnight, who retired in Haslett after more than 30 years with GM, says he speaks for most retired UAW workers when he says the union had no right to agree last year to cut some of his benefits.

http://www.freep.com/apps/pbcs.dll/article...4/-1/BUSINESS07

[Guest buickman]

Two words describe the cause... Richard Wagoner. Time to place the blame, accountability, and responsibility squarely where it belongs, on the man at the top who has guided the ship straight down.

Buickman

[greg_nate]

Its about time someone pointed out that the emperor has no clothes.

Does it benefit anyone by postponing the inevitible for another 5 years, possibly ruining GM beyond repair?

I say cut the losses now. Start with a clean, competitive slate as soon as possible. There are too many parties involved to achieve any kind of positive cooperation. And contrary to some people's posts on here, the UAW is not being cooperative. The only reason they agreed to legacy benifit cuts was because they knew that they would be challenged in the courts.

The best case scenario is if:

- GM files for bankrupcty

- Unions are busted.

- Excessive executive compensation is halted. Change of CEO.

- Workers who want to actually work, go back on the job with competitive benefits akin to what Toyota and Honda offer here.

- Ford follows suit.

- GM is then allowed a fair playing field with its Asian competitors.

- GM is allowed to focus on innovation and quality, sinking much needed money into development.

- Ford follows suit.

- American auto industry and auto workers then get a chance to show their true excellence and competetiveness. They gain dominant market share once again, and return to the status of an industry that is a keystone of our economy.

Edited March 4, 2006 by greg_nate

[SimonDavid]

Its about time someone pointed out that the emperor has no clothes.

Does it benefit anyone by postponing the inevitible for another 5 years, possibly ruining GM beyond repair? 

I say cut the losses now.  Start with a clean, competitive slate as soon as possible.  There are too many parties involved to achieve any kind of positive cooperation. And contrary to some people's posts on here, the UAW is not being cooperative.  The only reason they agreed to legacy benifit cuts was because they knew that they would be challenged in the courts.

The best case scenario is if:

- GM files for bankrupcty

- Unions are busted.

- Excessive executive compensation is halted.  Change of CEO.

- Workers who want to actually work, go back on the job with competitive benefits akin to what Toyota and Honda offer here.

- Ford follows suit.

- GM is then allowed a fair playing field with its Asian competitors.

- GM is allowed to focus on innovation and quality, sinking much needed money into development.

- Ford follows suit.

- American auto industry and auto workers then get a chance to show their true excellence and competetiveness.  They gain dominant market share once again, and return to the status of an industry that is a keystone of our economy.

I agree with this

GM will lose a bit of market share during this, but its the price they are going to have to pay. Whatever emerges from chapter 11 will be a viable competitive business

It will be interesting to watc tozota through this ß they dont want a GM bankruptcy - they want GM to limp along for a few more years

. Interesting article recently - Delphi is now a critical supplier for Toyota as well.

[FAPTurbo]

Its about time someone pointed out that the emperor has no clothes.

Does it benefit anyone by postponing the inevitible for another 5 years, possibly ruining GM beyond repair?

I say cut the losses now. Start with a clean, competitive slate as soon as possible. There are too many parties involved to achieve any kind of positive cooperation. And contrary to some people's posts on here, the UAW is not being cooperative. The only reason they agreed to legacy benifit cuts was because they knew that they would be challenged in the courts.

The best case scenario is if:

- GM files for bankrupcty

- Unions are busted.

- Excessive executive compensation is halted. Change of CEO.

- Workers who want to actually work, go back on the job with competitive benefits akin to what Toyota and Honda offer here.

- Ford follows suit.

- GM is then allowed a fair playing field with its Asian competitors.

- GM is allowed to focus on innovation and quality, sinking much needed money into development.

- Ford follows suit.

- American auto industry and auto workers then get a chance to show their true excellence and competetiveness. They gain dominant market share once again, and return to the status of an industry that is a keystone of our economy.

I wholly agree with this argument. We gotta see change: starting with the union busting and the replacement of the CEO. Honestly, I'd like to see a board with as few grey haired people as possible, (maybe keep Lutz) and is willing to take a few risks and inject life into the brand.

[Croc]

Two words describe the cause... Richard Wagoner. Time to place the blame, accountability, and responsibility squarely where it belongs, on the man at the top who has guided the ship straight down.

Buickman

[FUTURE_OF_GM]

It’s official: bankruptcy is good for GM.

WOW!! You cn tell that this guy is f*cking clueless even before the second sentence.

In their recent ass-covering exercise for the Securities and Exchange Commission (SEC), The Ford Motor Company listed "adverse effects from the bankruptcy or insolvency of a major competitor" as a significant risk to its financial future. Translation: if GM goes bankrupt, The General will slough off its excessive labor costs and become… wait for it… competitive. So competitive, in fact, that Ford reckons GM’s products would gain an important price advantage. Well how about that?

Ass covering exercise?!?!??! care to justify that statement??? Or is it just more smart assed media banter?

WELL DUUUUUUUUUHHHHHHH!!!!!! Anybody with ANY basic sense knows that bankruptcy protection would make GM uber competitive... That isn't even the issue.

Obviously, there’s more to it than that. Ford’s SEC filing also alerts investors that GM’s Chapter 11 could destroy The Blue Oval’s supply chain. Both automakers share a large number of mission critical parts suppliers; if GM’s submersion sucks vital parts makers into bankruptcy-- which it most assuredly would-- Ford will lose access to the bits and pieces it needs to build Fords. In fact, it’s hard to see how Ford could survive a GM bankruptcy. Or why it would want to.

And SAC, just like that, the media and self loathing americans will have destroyed yet another once great american industry... But then, who cares?!?! After all, we can all just gain employment and sense of accomplishment through our HUGE "SERVICE" industry servicing all those imports..., Then, of course, the media has been "servicing" the imports for YEARS now.

The automotive community is slowly (and quietly) beginning to conclude that bankruptcy is both the only thing and the BEST thing that can happen to GM, and, by extension, Ford.

That's right.... ACCEPT DEFEAT!!!! And the anti-Detroit people are WILDLY proclaiming victory. You can hear it in the tone of all the cynical anti-Detroit articles.

Detroit was written off 3-4 years ago when the media blitz against them began. The media KNEW what would happen... They were well on their way to RUINING Chrysler (The weakest) until the company got whored out to the Germans. Then they targeted Ford and pretty much ran them into the ground (Many analysts have said that Ford would've WENT bankrupt had they not been a household name _OR_ that thy would've been sold too had the Ford family NOT still held so much of the company) and now it's GM's turn.

But that is the goal right? To destroy, run off or sell off all of what made america, america right??? Oh it's not? Well, you could've fooled me, with all the self loathing, throat cutting, legislating FOR imported goods and making american industries uncompetitive.

To review: GM can’t build competitive vehicles at a profit.

Oh really?!?!?!

GMT900..... C6, XLR, CTS, STS, SRX, LUCERNE, G6, AURA, THE LAMBDAS etc etc etc...

It’s got too many models, brands and dealers.

STILL this tired argument!!!!

GM's brands and dealers are an ASSET... Why would anyone with GM's best interest at heart want them to "give up" gained ground?!?!?!

Too much bureaucracy, waste and inefficiency.

Facts please.

its supply chain is about to snap.

This guy is the ONLY person I've heard EVER say this... Apparently he has some well placed resources or he's blowing smoke up our ass; you pick.

The United Auto Workers (UAW)’s contract prevents any wage or benefits cuts, and precludes any alteration to their Byzantine working practices.

Good thing it's coming up for renegotiation in a year.

euthanizing fatally wounded brands.

fataly wounded brands?!?!?! YOU KNOW, the same brands that saw RETAIL SALES INCREASES LAST MONTH and have 3 of the hottest products at GM.

And even if it was, GM CEO Rabid Rick Wagoner is singularly incapable of tackling this monumental leadership assignment.

A WHOLE lotta

The General doesn’t have enough cash to weather the turbulence between business-as-usual and the end result of a lengthy, radical, difficult and dangerous overhaul.

Ummm.... okay

We’re already seeing some strange behavior emerge from GM World: a public pledge to end to discounts followed by a “March madness” incentive campaign,

GM NEVER said that they would COMPLETELY kill incentives an they have ALWAYS said that incentives are here to stay and are an extensive part of doing business competitively.

exciting new cars announced and cancelled and re-announced;

That's called: AN IGNORANT MEDIA THAT DOESN'T HAVE A CLUE AS TO THE REALITY OF THE SITUATION AND THUS FORMULATES STORIES AND PASSES THEM OFF AS FACT... ALL automakers go through decision making, yet none are scrutinized, fantisized or bandied about like GM.

a Board Member and Car Czar squabbling over a moribund Swedish car brand,

That's because, at the time the "board member" wasn't a "board member" and didn't have ANY of the FACTS of the situation...

As GM’s fate reaches its terrifying conclusion, workers will get all the attention. The moment the axe falls, whether by a slow strike or a lightning default, the spotlight will shift to “the little guy.”

Screw the little guy... His union is A LOT of the reason GM is in such bad shape right now.

Needless to say, the media will depict them as victims.

OF COURSE, anything to kick dirt in Detroit's face before lowering them into their grave.

They’ll highlight the most desperate cases and blame their fate on management incompetence, outsourcing, the Japanese, the Chinese, foreign trade policy, currency manipulation, oil prices, George W. Bush, the anti-GM press, anyone and anything other than the workers themselves.

I've bolded the REAL problems which should be blamed

This guy is a f*cking idiot....

You should automatically KNOW his bias and opinion by the TITLE OF THE SERIES...

- American auto industry and auto workers then get a chance to show their true excellence and competetiveness. They gain dominant market share once again, and return to the status of an industry that is a keystone of our economy.

YEAH RIGHT...

The anti-Detroit people would NEVER allow this to happen... They've worked vigorously for 30 years to try and oust Detroit. This is VICTORY for them. If we give up, then we give up.... PERIOD there will be NO domestic auto industry.... Share will fall through the floor, MORE people will be "enlightened" to Japan Inc. GM and Ford will AT BEST struggle for 5-10 years trying to convince a NAIVE and BLIND public that they HAVE changed and ARE safe to buy from; all the while, the media will once again be working overtime against them. Then they will likely be bought by a bigger (Japanese) foreign firm (You know, bought like THE REST of american industry)

If anything, GM and Ford will be niche players like the Euros after bankruptcy and will kill each other trying to reclaim the share that they were screwed out of.

:twocents:

[FAPTurbo]

Two words describe the cause... Richard Wagoner. Time to place the blame, accountability, and responsibility squarely where it belongs, on the man at the top who has guided the ship straight down.

Buickman

Ok. I have an idea. Work with me here guys.

Lets imagine that a few years ago, Buickman is granted a wish (by either God or Satan... your choice) and he wishes to be the CEO of the worlds largest car company!

So, instead of Ricky Wagoner, Buickman takes the helm of the "ship."

So here is my challenge: to all of our seasoned members who have dealt with Buickman, I would like you to give us the "alternate future" of what GM would look like today if Buickman were the head honcho. Make sure you factor in his logic and statements. I know many of you have tangled with this guy before, and he always seems to blame Ricky for all of GM's problems.

So... would GM be better off if Buickman took the top job? Will GM be a proud automaker that sees profits and has a diverse, well buillt lineup?...

... Or will it end up being Hyundai's brake pad supplier?

Either start up a new message board, or lets use this one. I hope this goes forward... it'd be awesome if it did!

[Croc]

Well, since Wagoner hired Lutz, I would say that Buickman wouldn't have even had Lutz on his radar (Lutz isn't a marketing guru) and therefore Lutz wouldn't be at GM. Therefore Lutz wouldn't have ordered the Regal/LaCrosse redo, the STS redo, the Lucerne melt and repour, or any of the other myriad of positive changes Lutz has brought about. Therefore, I would say Buickman would be CEO of a company with even more uncompetitive product, though the marketing might be a bit better.

We also would not have had the GTO, we wouldn't have the Solstice or SKY, the SSR would likely still have the wimpy engine, etc. The commercials would likely be better, but that's it.

[91z4me]

Two words describe the cause... Richard Wagoner. Time to place the blame, accountability, and responsibility squarely where it belongs, on the man at the top who has guided the ship straight down.

Buickman

Didn't you get banned from this like many other enthusiest websites?

Seriously FOG wrote it out this article is pure crap.

And to Dodgefan, GM is already doing much of what you have listed. But some things take time.

[buyacargetacheck]

Two words describe the cause... Richard Wagoner. Time to place the blame, accountability, and responsibility squarely where it belongs, on the man at the top who has guided the ship straight down.

Buickman

Buickman is right. Wagoner's performance has been terrible on just about every metric. Yet, strangely, he still has a job.

And what's all this talk about Buickman seriously thinking he could be chairman? If he wrote/said this it was probably meant as hyperbole. I'm sure Jim Dollinger (like all of us) would be satisfied with any American executive who understands the car biz and who can get the job done with integrity. I guess I don't understand all these attacks on him. He's on our team after all. Why attack him just because you think he's smokin' crack?

[Croc]

Why attack him just because you think he's smokin' crack?

That seems like a pretty good reason to me...

I cannot say Wagoner's performance has been bad. He's hired and turned product development over to Lutz. You think that's bad? We haven't seen but glimpses of the new product. Just wait. Obviously Wagoner still has a job because none of "his" and "Lutz's" products have been released yet. Just be patient grasshopper.

[PeterPuck]

No, no. It really is this simple.

Rick Wagoner is the source of GM's current woes.

Wagoner inherited a perfectly healthy company, with thirty years of excellent cars, stylish designs, consumer goodwill, excellent executive decisions, small legacy costs, a happy and cooperative union, and a high level of efficiency.

He flushed it all down the toilet because he is the embodiment of incompentence.

Right?

[CaddyXLR-V]

No, no.  It really is this simple.

Rick Wagoner is the source of GM's current woes.

Wagoner inherited a perfectly healthy company, with thirty years of excellent cars, stylish designs, consumer goodwill, excellent executive decisions, small legacy costs, a happy and cooperative union, and a high level of efficiency.

He flushed it all down the toilet because he is the embodiment of incompentence.

Right?

Hahaha. Exactly. It's not like GMs marketshare was declining since the 70s or anything. Those vegas and chevettes and cavaliers, perfect cars. Why did Wagoner have to F them up and give us the Cobalt SS SC. Why did he have to go and ruin the interiors, the GMT-800s interiors were so damn perfect, and now we have the mess they call an interior in the GMT-900s. What was Wagoner thinking?

[91z4me]

No, no.  It really is this simple.

Rick Wagoner is the source of GM's current woes.

Wagoner inherited a perfectly healthy company, with thirty years of excellent cars, stylish designs, consumer goodwill, excellent executive decisions, small legacy costs, a happy and cooperative union, and a high level of efficiency.

He flushed it all down the toilet because he is the embodiment of incompentence.

Right?

Sure because Zallera didn't want to make the next fullsize trucks FWD based unibodies. And he didn't want EVERYTHING outside of Caddy and Corvette FWD. And he didn't want the CTS-V to be a turbo V6 instead of the cheaper, lighter, more powerful LS6.

Zellera was running GM into the ground Rick is fixing the product and that is the most important thing he could do at this point.

Say it with me Jim "It is ALL about the product, ALL about the product!"

[Petra]

As much as I despise Farago for being a pompous, pretentious prick, he's got some valid points.

its supply chain is about to snap.

This guy is the ONLY person I've heard EVER say this... Apparently he has some well placed resources or he's blowing smoke up our ass; you pick.

I refer you to this article:

http://www.thetruthaboutcars.com/content/1...49391580627324/

[I hope GMRULES again]

This is an interesting read. I just wish something major would happen even if it is bankruptcy, that would be better than another 10 years of market share loss and plant closings. May as well go for broke instead of dying a slow death.

[FUTURE_OF_GM]

As much as I despise Farago for being a pompous, pretentious prick, he's got some valid points.

This guy is the ONLY person I've heard EVER say this... Apparently he has some well placed resources or he's blowing smoke up our ass; you pick.

I refer you to this article:

http://www.thetruthaboutcars.com/content/1...49391580627324/

Yes, I know. I read that. But, it's from the same source.

[ellives]

Sorry but this comment is too simplistic. You simply can't blame one person for the problems at GM, whether you happen to like this person or not. If RW was really the cause, the board would oust him. They didn't, so either he really isn't that bad or the board is incompetent.

While the article at the start of this thread is gloomy, there is some modicum of substance in things being said, particularly about the union and compensation overall. GM needs major change and I really don't like the idea of bankupcy but to the point of the article, if they parties can bring themselves to solve the issue, maybe bankrupcy is the answer. This is a lot like an argument a friend of mine has with me. He believes the congress is incapable of enacted legislation that directly impacts them, such as congressional term limits and points to Ted Kennedy as proof.

Two words describe the cause... Richard Wagoner. Time to place the blame, accountability, and responsibility squarely where it belongs, on the man at the top who has guided the ship straight down.

Buickman

Edited March 12, 2006 by ellives

[Guest buickman]

MAO vs. NAO

The Long March

It was a military feat which not only preserved the Chinese Communist party and the Red Army, but enabled Mao Zedong to eliminate his internal opposition.

The Long Decline

It has been a business strategy to eliminate American unionism and move production overseas, simultaneously reducing franchised dealers to one day allow factory owned distribution channels.

Hundred Flowers Campaign

"Let a hundred flowers bloom, let a hundred thoughts contend." It was launched on May 1, 1957 by Mao with an invitation to criticize the Chinese Communist party, as well as the government. Six months later the Great Leap Forward program was launched, and this involved sending intellectuals and trained personnel, such as doctors and engineers, to the countryside. The campaign against the intellectuals finally culminated in the Cultural Revolution.

Hundred Years

After saying there were no plans to close Oldsmobile after 100 years of existence, Rick Wagoner did just that. (and we're to believe him about bankruptcy?)Ask yourself, was Olds that poorly managed, or intentionally closed? How can a division selling in excess of 1,000,000 units with such a rich heritage be run into the ground? Like Mao, Rick refuses to listen to intellectuals who know and understand the retail automotive market. Today, the Great Leap Backward continues as Buick and Pontiac struggle to survive, starved of product by a corporation hell bent on wasting capital with Fiat, Saab, Saturn, Subaru, and Izusu. Consequently, the United States itself is experiencing a Cultural Revolution of it's own, as the American middle class and standard of living disappears as a result of incompetent management who blame workers and the government for the decline caused by executive ineptitude.

Chairman Mao vs. Chairman Rick

In truth Mao was no Communist, he was simply another in a long line of Emporers who ruled with an iron fist. He hid behind the mask of Communism in order to justify his own methods of achieving a personal agenda.

Today, we are suffering the effects of actions by a leader who is giving Capitalism a bad name. The track record of "Red Ink Rick" since becoming head of NAO (North American Operations) in 1994, defies logic when considering how in the world the Board leaves this man in charge. The answer most likely lies in the fact that these men and women know exactly what the game plan is. Simply, we must realize that there are forces at work well beyond the leadership of General Motors. International bankers who control most of Corporate America, as they control the Federal Reserve, are implementing a well conceived and coordinated effort to do away with pensions and health care for millions of our citizens. It's men like G Richard Wagoner who give capitalism a bad name. Although he takes marching orders from undisclosed sources, the man is morally guilty of a crime against humanity.

Sources:

"Companion to Chinese History" by Hugh B O'Neill 1987

and plain old common sense.

Buickman

Edited March 12, 2006 by buickman

[Guest buickman]

Au Contraire.

Wags is no terrorist. He is a pre-ordained flunky having zero credentials and absolutely no credibility.

Buickman

PS

He's goin' down bro!

[Robert Hall]

Sorry but this comment is too simplistic. You simply can't blame one person for the problems at GM, whether you happen to like this person or not. If RW was really the cause, the board would oust him. They didn't, so either he really isn't that bad or the board is incompetent.

While the article at the start of this thread is gloomy, there is some modicum of substance in things being said, particularly about the union and compensation overall. GM needs major change and I really don't like the idea of bankupcy but to the point of the article, if they parties can bring themselves to solve the issue, maybe bankrupcy is the answer. This is a lot like an argument a friend of mine has with me. He believes the congress is incapable of enacted legislation that directly impacts them, such as congressional term limits and points to Ted Kennedy as proof.

GM has had problems for years...certainly going back to at least the dark days of Roger Smith.

[91z4me]

Fly, Josh,

I thought buickman was banned from here a while ago.

BTW Jim, I have a feeling if you try to call for Rick's removal again you may be laughed out of the room.

[Guest buickman]

Guarantee you this much. Wouldn't have blown $4 Billion on Fiat and Buick would be strong as hell, printing profits.

Buickman

[91z4me]

Guarantee you this much. Wouldn't have blown $4 Billion on Fiat and Buick would be strong as hell, printing profits.

Buickman

Because Buick is the most important brand at GM right? Face it you DON'T know how to be objective on the subject and because of where you are and your lack of diversity of experience. You are NOT the person to tell GM what to do.

[CaddyXLR-V]

Guarantee you this much. Wouldn't have blown $4 Billion on Fiat and Buick would be strong as hell, printing profits.

Buickman

Wasn't there a different CEO at the time that deal was signed? What would GME's marketshare have been without the much needed diesels they got out of the deal? And I'm sure you wouldn't have purchased daewoo and formed GMDAT either would you? They are one of GMs most valuable assets right now. You have 75% percent of this website against you, dont you think you should quit while your behind?

[Guest buickman]

Here's an editorial plus a bit from last year's annual meeting. Given that last year stockholders and media waited up to four hours to speak with me after the meeting, I seriously doubt I'll be escorted anywhere.

Arm's Length vs. Hand in Pocket

Jim Dollinger

Friday, February 24, 2006

"Enron was not the first company to compromise the work of it's auditor. Before anyone had heard of Enron, Just For Feet, a sorry-a##, Super-Bowl-ad-running shoe store chain, went from a market cap of $700 Million to zero in three years with Deloitte & Touche's accountants on watch. Deloitte's consulting arm hit the company up for business to fix its internal control problems.

"Because the auditors and consultants are typically partners, the accountants benefit when the advisors get work. And not all that 'independent' of an independent auditor."

David Faber

At last year's Annual Meeting, I questioned Mr. Wagoner as to why we have retained the same audit company for over 70 years. This is the same audit company we had when one of our franchisees, Mr. McNamara burned us for over $400 Million through false invoicing of non-existent vehicles, supposedly sent to the mid-east by his dealership. Mr. Lovejoy, head of GMAC at the time, was moved laterally to GMSPO, and to my knowledge, no one was held accountable.

"Most of the time auditors simply miss fraud. But sometimes the auditors have a motive to help the fraud along. The other services provided by the big accounting firms often put them into a conflict of interest.

"The larger the company, the larger the percentage of fees paid for services other than actual audits."

D Faber

As auditors for Parmalat and Adelphia, Deloitte was guilty of a dereliction of duty and failed to properly protect the shareholders from fraud.

"Parmalat discloses an account in the Cayman Islands supposedly worth nearly $5 Billion is fake"

New York Times

My suggestion at the Annual Meeting was to "rotate the audit company every three years". Although this would not serve as a cure all to the issue of discovering and correcting fraud and corruption at General Motors, it is a logical first step and would at least provide the appearance of an arm's length relationship.

Not surprisingly, Mr. Wagoner replied, "thank you Mr. Dollinger" and did nothing.

Coming soon: Resignation vs. Indictment

Buickman

[Chicagoland]

Buickman would have had GM making the A bodies [Ciera, Century], forever. With fake convertible tops, wire hubcaps, and velor bench seats. Yay, say some of C&G, but why not just bring back hand crank starters and wooden wheels?

Meanwhile the Real World couldn't care less about old dated cars. "Marketing" is all the matters? Like buyers are so dumb all they need are huge rebates and free T-shirts?

[CARBIZ]

But that is the point: in the '80s, Oldsmobile for a couple years sold more cars than Ford did. At that point, the Cutlass Ciera (velour and all) is what people wanted. Even though this was before Wagoner's watch, is there any coincidence that the rise of Saturn paralleled the fall of Oldsmobile? Surely we can see that funds had to come from somewhere to build up Saturn. Oldsmobile could and should have been the import fighter.

I am sure there is plenty of blame to go around, but the traces of GM's rot clearly do go back to the Smith era and the lack of product leadership. Mid-80s Cadilllacs, for example - a joke that paved the way for Acura and Lexus.

This Delphi thing really worries me. How could a company be "spun off" if the parent company is still on the hook for legacy costs? That is just silly.

I hope that Wagoner and his cronies have aces up their sleaves and are speaking out of both sides of their mouthes because they have to. Hiring Lutz is one sign of encouragement.

Or am I just being naive?