Does A Company As Big As GM Have A Responsibility To The Nation Or Just The Shareholders?

Is this a trick question?

No but Mary Barra won't be in charge much longer. When you get the UAW and Trump against you, you're done.

Any firm has to balance the needs of its shareholders, its employees and its customers. You cannot have a healthy business without that. For several decades GM was run on the basis of the contractual requirements of its employee unions. They have to pay the employees and their benefits regardless of market conditions so the goal was to keep the plants going turning out vehicles the customers didn't want and keeping earnings low. That led to bankruptcy. European car companies still have to do that. In the bankruptcy shareholders lost as they were supposed to, the bondholders, who were supposed to have senior financial rights, got screwed to protect the employees. Technically against the law. The new GM did offer buyouts to the salaried employees in this situation with the warning that if not enough signed up there would have to be layoffs. That's pretty common as a way to deal with gross changes in nonunion companies. The problem here is that the union contracts get in the way of doing that with the plant workers.

The USA has the unique view among nations that its multinational businesses and ex pat citizens for that matter belong to the USA. So they pay taxes in the location where the operate or live, but then the USA turns around and taxes them on that income again. Unique in the world. Nobody else does that. GM, like other large USA headquartered businesses (Apple, Google, IBM, etc.) aren't arms of US government policy, but have to do what's best for their global shareholders, and employees and customers if they want to survive. In this case its survival.

“The USA has the unique view among nations that its multinational businesses and ex pat citizens for that matter belong to the USA. So they pay taxes in the location where the operate or live, but then the USA turns around and taxes them on that income again. Unique in the world. Nobody else does that.”

Tell me about it, having lived and worked overseas and a small business overseas that whole idea is bizarre. Nobody else I worked had to do this, Even countries like Greece that could use the revenue did not make their citizens pay taxes twice.

I'm not an Obama fan, but it is deeper than him.

There come a point when you take the money and run or do what is right for the nation you live in. Which did GM do?

The Fed lost about $11.2 Billion on the GM bailout, yet a decade later they are bailing out on the industry the Fed invested in them to preserve. Kind of stings the taxpayer.

So how do you propose to solve the problem ? Industries change as technology advances and customers change what they want. Look at the electronics business.
In the 1970s lots of workers were required to load individual components onto circuit boards to make the products work. In the 1980's those components were replaced by a few integrated circuit chips. In the 1990's robots did the loading work and there was more software in the products. In the 2000's software took over and a smartphone replaced a lot of the individual products. Today that industry needs a mere handful of the manufacturing workers it had in the 1970s. In needs lots of highly educated software and engineering personnel. What the bailout did was try to preserve jobs that were going away anyhow. It would have been far better to let GM and Chrysler go through a regular bankruptcy without government aid. They would have emerged as much smaller but more nimble firms.
While our government folks extol FCA for keeping the manufacturing jobs in the USA, many on this forum have pointed out that FCA doesn't have much of a future. So FCA is stopgap.Look at the Tesla plant. Designed to be totally automated for a vehicle that is much simpler to make. Ergo a lot fewer assembly workers (if they can achieve their goal. They haven't yet). That's part of the future GM sees. BTW since the majority of GM's business is in China, should they move their headquarters there?

GM should pay back the $11.2 billion bailout regardless if they keep the jobs or not. They got to keep the company alive at the expense of tax payers, they should pay back instead of lining their executives' pockets with stock buybacks and compensation packages.

The government didn't stipulate back in 2009, that they want "all of the money back".

GM needs to stay relevant, and if this is how they see fit, then they must. GM failed in 2008 because they were too big, clumsy, had way too much excess capacity, too many brands. Mary Barra has made it a priority to get away from heavy incentives to move vehicles, which typically leads to lower sales volumes and higher profits. As usual Trump just speaks out of his A*s and caters to the lowest common denominator. If Trump really wants to do something(along with all the other boneheads in Washington), our economy needs a complete rethinking, because it is broken. $21 trillion in debt and growing, yearly government budget deficits, are going to make GM shedding 14K jobs inconsequential.

Companies have to put product development and efficiency first if they are to survive. For some time our country has been transitioning from a manufacturing economy to a service and software driven economy. Manufacturing always chases low cost labor to compete effectively globally. GM simply hasn't kept pace competitively on multiple fronts.

"Does A Company As Big As GM Have A Responsibility To The Nation Or Just The Shareholders?"

Should ask a similar question to our politicians.

You guys tired of winning yet?

https://youtu.be/3FMu_jNOUwY

Who are the shareholders? All of us. Anybody who has a pension plan, 401k, IRA, college 529 fund, you name it. And the people who run those plans are are pretty tough on companies to be profitable and grow. Even those of you who have a government job, governments invest in the stock market to try grow the pot as fast as possible. Having been a public company CEO, my experience is that the public employee pension funds push the hardest. Mary Barra was rewarded by these pension fund managers with a stock price jump because she had the guts to do this. Its hard but the bloated backward looking GM has to change and this is part of it. GM probably has to do even more to survive long term.

Agreed. With 75 plants worldwide GM will be cutting and closing more plants in the future. Under performing car and truck models as well as plants that are below capacity are not going to be part of their future. I am sure others will follow this path in time.

Both

Flag This >>> I am in agreement with EVisNow and CanadianComments

GM full size truck sales are occupying #3 level after Ram and Ford.
The brand new Sierra has turned out to be a turkey.

Trust me on this. Chevy/GMC dealers are angry and I would not be surprised to see Mary Barra get canned for his gross mismanagement of GM.

Barra works primarily for the shareholders, not the dealers. One botched model, even their top seller, is unlikely to get her fired if the corp. profitability is there. Depends on how quickly they fix it. Graft the Tahoe nose onto the Silverado? Drop the 4 banger? Stick a Vette engine in it? Lots of things they can do to fix it. She does need to shake up GM design quickly. Needs a modern Harvey Earl, Bill Mitchell. Good question for the Spies. Who should GM bring in to head up Design.

I do not think the BOD and the CEO really care much about the U.S. since they are moving many of the vehicle assembly plants to Mexico, China and possibly Vietnam. Their engine and powertrain plants will be next too!

I would agree with you. I've met MB and believe she loves GM, her dad spent his life there as has she, and she was mentored by the best. I also think she was a Hitlary voter which is simply crazy..

That said she is filling big shoes and I'm just not sure she is getting it done. Autonomous and EV's might be the future but the future is not here yet so they'd better get what the market is currently buying right, which they are not. There are alot of excellent people at GM but I think an outsider might be best to turn the culture upside down. I'm not holding my breath for GM which is really disappointing...

at least one of the north american car companies will die. as it should. this isn't a socialist country and business needs to look out for its own interests. having said that there is nothing that is too big to fail. stop treating capitalism like its kindergarten.