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Boost it!

GM Making "Difficult Decisions" To Survive

Sarcastic1 submitted on 7/15/2008 Official Bell & Ross Timestamp: 12:01:12 PM

18 user comments | Category: Misc News | Source: | SOURCE: money.cnn.com

NEW YORK (CNNMoney.

com) -- General Motors Corp. said Tuesday it will suspend its dividend, sell off $4 billion to $7 billion worth of assets and cut 20% worth of salaried cash costs in an overall plan to save billions of dollars.

"We need to take some very tough actions to ensure our survival and success," said Chief Executive Rick Wagoner, in a press conference, referring to the current market conditions as an "unprecedentedly difficult time."

GM (GM, Fortune 500) stock dropped about 5% on the news, but it bounced back later in the session to rise about 1%.

In an earlier broadcast to employees, Wagoner said that these were "difficult decisions," but necessary for the company to prevail in the weak economy beset by high oil prices, which he called GM's "greatest concern."


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Sarcastic1

Have: 2003 Volvo S60 2.4T Want: E46 M3

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User Comments

EnnNorak

The only available decisions are never difficult -- they are simply painful. Pain is better than death. I'd like to know the terms under which that $7 billion credit is available.

The truck market belongs to the first manufacturer out of the gate with a lightweight aluminum and carbon fiber truck powered by a smaller diesel designed for longevity and reliability.

— EnnNorak (View Profile)

Posted on 7/15/2008 2:38:14 PM | reply to this comment | Votes: 3   

91z4me

Sorry but the aluminum/carbon fiber truck isn't coming from anyone anytime soon. First off all there would need to be a LOT of aluminum in that frame to have the same capability as a steel frame, so there goes a lot of the weight savings right there. Second of all I don't think to many people are willing to shell out enough dough for a truck to make a model w/ those requirements profitable.

— 91z4me (View Profile)

Posted on 7/15/2008 4:27:18 PM | | Votes: 1   

MadibaP

Yes lets just cancel the truck, its a stupid vehicle anyway!

— MadibaP (View Profile)

Posted on 7/16/2008 2:50:35 AM | | Votes: 1   

Maverick2020

These weren't difficult decisions--that is pure spin.

A difficult decision would have been to address the too many brands/models/dealers issue to ensure GM's long-term success.

What will it take for GM's executive team to finally tackle this problem? How bad will it have to get? How low will GM's stock price have to go before it addresses what we all know must be done?

— Maverick2020 (View Profile)

Posted on 7/15/2008 2:48:00 PM | reply to this comment | Votes: 0   

Whelan

The next move from the whole hybrid and fuel efficiency is going to be weight savings. Back years ago small cars were able to get high 30's in MPGs and I've seen people here and there talk about their little old cars. But that was years ago before airbags, crumple zones, stronger frames, etc. all came into play and all added weight. Each of those killed the efficiency and the engine can only be tuned so much for fuel mileage. Shed some weight with lighter materials like CF and aluminum and you can make a BIG difference.

Thinner sound deadening and insulation materials such as those offered by GrafTech who make a Carbon Fiber bades insulation/deadener for aircraft would be a great start. It's just a matter of becoming affordable. But when you make a product less than half as thick as regular insulation and deadeners that offers superior quality, why not.

— Whelan (View Profile)

Posted on 7/15/2008 3:01:00 PM | reply to this comment | Votes: 4   

MadibaP

Yup! We need light wight and low speed! The cars should not be able to go more than 100km/h.

— MadibaP (View Profile)

Posted on 7/16/2008 2:52:47 AM | | Votes: 0   

eamaxson

If we could only get government management (the administration) to do the same...

— eamaxson (View Profile)

Posted on 7/15/2008 5:21:50 PM | reply to this comment | Votes: 3   

TurboSpyder

Is it just coincidence that GM, Chrysler and Ford are teetering on the brink of bankruptcy at the same time that the US government and the average US household also have huge debts that they're going to find very difficult to pay off?

— TurboSpyder (View Profile)

Posted on 7/15/2008 6:05:56 PM | reply to this comment | Votes: 5   

MercedesBenz00Z

This is what happens if you keep producing junk cars that don't last long. GM supported Nazi Germany in the 30's, it tried to make fake hybrids just to compete with Toyota but miserably failed, and now it is near bankruptcy.

And Ford is pretty much the same. Seriously, let the American workers work for the German or Japanese car factories, that is the only way to save the U.S. economy.

— MercedesBenz00Z (View Profile)

Posted on 7/15/2008 6:51:22 PM | reply to this comment | Votes: -3   

jackson63

GM has came along way in terms of quality,however they did produce alot of inferior products in the past.I dont know about the German automakers but Toyota sends about 73% of their profit back home where as GM keeps
over 90%in the USA.So as far as working the Japanese or any other foreign company no thanks.

— jackson63 (View Profile)

Posted on 7/15/2008 9:40:24 PM | | Votes: -1   

ChicaneShooter

LOL!

90% of ZERO = Zero.

you shoulda said gm keeps 90% of their LOSSES here.

— ChicaneShooter (View Profile)

Posted on 7/16/2008 3:29:43 AM | | Votes: -2   

zorbeeze

"you shoulda said gm keeps 90% of their LOSSES here"

How does that make any sense???????????

— zorbeeze (View Profile)

Posted on 7/16/2008 8:56:41 AM | | Votes: 0   

91z4me

If you want to talk about supporting the Nazi movement Henry Ford would be the person to look at not the company GM, he and Hitler were big fans of each other (part of a huge PR problem for Ford Inc at the time). If you have a problem with GM and it's Nazi involvement what do you think of VW, Porche, and Audi?

— 91z4me (View Profile)

Posted on 7/16/2008 6:29:10 PM | | Votes: 1   

shabaru

GM is one of the biggest car companies in the world!?!?!?..... but where's their R&D?... a company that huge is dying?... I honestly think that all the legacy GM has been through is kind of sick if it was to come to an end....

— shabaru (View Profile)

Posted on 7/15/2008 8:04:02 PM | reply to this comment | Votes: 2   

91z4me

GM has R&D in all of it's operations. Currently R&D is setup in 'homerooms'. GMNA does trucks/SUVs, Caddy cars, and Corvette. GM Holden is doing volume RWD large and midsize cars. GM Daewoo is doing subcompact cars/SUVs, compact SUVs, and micro cars. GM Europe is doing FWD/AWD cars. GM Brazil is the current homeroom for compact pickups and SUVs.

— 91z4me (View Profile)

Posted on 7/16/2008 6:32:24 PM | | Votes: 2   

audirevolution

Poor GM. It's sad that they are on the brink of bankruptsy right when they started making great products such as the Lambda Crossovers and the new CTS.

— audirevolution (View Profile)

Posted on 7/15/2008 9:23:08 PM | reply to this comment | Votes: 1   

jackson63

Over 90% of their investments.To be able to lose money I think that means they have some to lose.

— jackson63 (View Profile)

Posted on 7/16/2008 9:25:26 PM | reply to this comment | Votes: 1   

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