U.S. preparing Chrysler for Chapter 11
- Thread starter bwalker25
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wannafbody
wannafbody
Good idea Scott. By the time it's all over we'll have one car manufacturer owned by the US government and all be driving Aveo's.
Setec Astronomy said:Looking at the sales numbers I'm not really sure I understand it, but they do say this: ""There was a time, a long way back now, when you knew exactly what Pontiac stood for," which is akin to my comment that they forgot who they were.
So true Setec, the brand (Pontiac) is barely a shadow of it's former self.
Setec Astronomy
Well-known member
99blackSE said:
I dunno, it's complicated...part of my frustration is...I guess it felt like Pontiac was saying "if only we can come up with a Corvette everything will be fine", but you know the Chevy guys knew that if they only sold Corvettes they'd be out of biz in 2 days.
Bunky
Detailing Gnosis
Setec Astronomy said:
Detroit always seemed to be chasing that wow car concepts unlike Honda/Toyota who focused on making great not so hot 4 door sedans (Corolla, Camry, Accord, etc). That is, the hot cars may be the rage for a while but not enough to sustain the business long term. They chased the SUV market, etc when most new gas long term would go up or at least be very cyclical.
Detroit was cutting corners on the actual product (cheaper designs) to pay for all the overhead (labor, retirement in addition to the usual ongoing development costs, capital expenses for toolings) so you got less car for the money to meet a certain price point.
Toyota/Honda built NEW state of the art plants in the south without union labor while Detroit was often stuck with just spending a lot of money to refurbish existing less ideal locations.
Setec Astronomy
Well-known member
I don't think they were "always" chasing the "wow" car concept. In fact Roger Smith went right at the Honda/Toyota benchmark when he initiated Saturn in the early 80's.
IMO the "wow" factor came more into play in the last 20 years when the top mgmt. was more interested in the short term, rather than the long term (like virtually every other big company in the US, at least those not run by founders). In the day, the "wow" car was for showroom traffic, to try and get the masses into the Chevy showroom (to see the Indy Pace Car or something like that) instead of the Ford or Dodge before they bought their family hauler. In recent years, the "wow" car went from a traffic-producer to "salvation".
We've certainly had these threads before, and labor certainly had a role over the years, but when you're an executive earning millions of dollars a year, isn't part of your job to say "boy it's great making all this money on these huge trucks, SUV's, and powerful (thirsty) sedans, and who would have thought 20 years ago that gas would still be $2 a gallon now, but what are we going to do if we have another oil price increase or shortage like in 1973 or 1979? Honda and Toyota have hybrid cars that actually get a lot better mileage than a normal car (unlike our "lip-service" hybrids), aren't they going to stand a lot better chance than us if there is a gas price spike?" I guess the answer when they asked that was "who cares, I've made so much money I don't care if we go belly up or if the President gets me fired".
It's simply known as "not putting all your eggs in one basket", and that concept has been around a lot longer than cars.
IMO the "wow" factor came more into play in the last 20 years when the top mgmt. was more interested in the short term, rather than the long term (like virtually every other big company in the US, at least those not run by founders). In the day, the "wow" car was for showroom traffic, to try and get the masses into the Chevy showroom (to see the Indy Pace Car or something like that) instead of the Ford or Dodge before they bought their family hauler. In recent years, the "wow" car went from a traffic-producer to "salvation".
We've certainly had these threads before, and labor certainly had a role over the years, but when you're an executive earning millions of dollars a year, isn't part of your job to say "boy it's great making all this money on these huge trucks, SUV's, and powerful (thirsty) sedans, and who would have thought 20 years ago that gas would still be $2 a gallon now, but what are we going to do if we have another oil price increase or shortage like in 1973 or 1979? Honda and Toyota have hybrid cars that actually get a lot better mileage than a normal car (unlike our "lip-service" hybrids), aren't they going to stand a lot better chance than us if there is a gas price spike?" I guess the answer when they asked that was "who cares, I've made so much money I don't care if we go belly up or if the President gets me fired".
It's simply known as "not putting all your eggs in one basket", and that concept has been around a lot longer than cars.
Setec Astronomy
Well-known member
Holy crap! GM to cut 21,000 US factory jobs--what is that going to leave them with, about 4 guys building the cars?
GM to cut 21,000 US factory jobs, shed Pontiac
GM to cut 21,000 US factory jobs, shed Pontiac
Bunky
Detailing Gnosis
Setec Astronomy said:
Yes, 4 guys plus several hundred vice presidents.
the other pc
New member
jaymz said:
Hey, those were decades ago. GM's had plenty of time to learn their lessons.
jaymz said:
Uh, never mind.
pc.
imported_Jakerooni
New member
Mmm the mustang is looking better and better these days LOL... All part of doing business poorly I suppose though.
GM cuts jobs, dealers, drops Pontiac - Apr. 27, 2009
Does this mean that 40% of dealers including their workers, lot men, sales people, etc are out of jobs as well?
that 21,0000 to 23,000 jobs is that just manufacturing jobs, or is that including the dealer network? If its not both combined then we could be looking at even more than 23,000 jobs lost as a result.
What will the impact be on the parts suppliers once this happens? More cuts there too I bet.
cnnmoney.com link above said:
Does this mean that 40% of dealers including their workers, lot men, sales people, etc are out of jobs as well?
that 21,0000 to 23,000 jobs is that just manufacturing jobs, or is that including the dealer network? If its not both combined then we could be looking at even more than 23,000 jobs lost as a result.
What will the impact be on the parts suppliers once this happens? More cuts there too I bet.
beabout
New member
Chrysler has until 4/30 to make deals with:
1. UAW on wages/retirement/healthcare. check
2. Secured Dept Holders on haircut style. Won't happen (they would get better deal in C11/7)
3. Fiat merger. Won't happen (Fiat could wait for C11/7 and buy up the pieces)
GM (Government Motors) has until 5/31 to make deals with:
1. UAW on wages/retirement/healthcare. maybe/maybe not
2. Bond holders/Feds on haircut style. again, won't happen
My prediction:
1. Chrysler in C7 - Fiat and others to fight over remains.
2. GM in C11 - More cuts in capacity and brands.
a. GM's buick sells like hot cakes in China
b. merger of GMC & Chevrolet trucks into one brand.
1. UAW on wages/retirement/healthcare. check
2. Secured Dept Holders on haircut style. Won't happen (they would get better deal in C11/7)
3. Fiat merger. Won't happen (Fiat could wait for C11/7 and buy up the pieces)
GM (Government Motors) has until 5/31 to make deals with:
1. UAW on wages/retirement/healthcare. maybe/maybe not
2. Bond holders/Feds on haircut style. again, won't happen
My prediction:
1. Chrysler in C7 - Fiat and others to fight over remains.
2. GM in C11 - More cuts in capacity and brands.
a. GM's buick sells like hot cakes in China
b. merger of GMC & Chevrolet trucks into one brand.
I bet Chrysler failes and files Chapter 11, I dont see Fiat coming to the rescue now, and I certainly dont see the bond holders taking a hit like they would if they accept the deal.
GM on the other hand is a hard one.
I think the workers will accept concessions and thus net GM a little bailout money. However I think this will give false hope to a Titanic of a ship and it will fail before year end. In fact my bet is that by Thanksgiving 2009 GM/Chrysler will have filed Chapter 11.
I do not believe Chrysler has what it takes to re-emerge from C11, and it may attempt such a recovery but will then close doors for good soon after they try.
GM with its current business plan is IMHO not a company that can stand on its own, they have demonstrated a lack of self control, lack of care and knowledge of money management. They also have showed they care about there company, but I think they have waited FAR to late to try to get out of this. IF they make it out (and thats a BIG IF), I dont think we are done with their job cuts. I would look for 60% or more reduction in output/labor/factories (manufacturing). I would also try to keep dealers open ONLY in heavily populated cities, thus saving money through the dealer network.
IMHO they need to run a skelaton crew for a long while, perhaps 3 shifts of the bare minimum it takes to run an assembly line and perhaps only have output set to around 10 - 15% per factory.
Its clear it would take an idiot of a bond holder to accept the haircuts GM has offered...
Sure its drastic but we are talking the largest manufacturing company ever, thats in trouble and one hell of a problem for the US Economy if they fail.....
GM on the other hand is a hard one.
I think the workers will accept concessions and thus net GM a little bailout money. However I think this will give false hope to a Titanic of a ship and it will fail before year end. In fact my bet is that by Thanksgiving 2009 GM/Chrysler will have filed Chapter 11.
I do not believe Chrysler has what it takes to re-emerge from C11, and it may attempt such a recovery but will then close doors for good soon after they try.
GM with its current business plan is IMHO not a company that can stand on its own, they have demonstrated a lack of self control, lack of care and knowledge of money management. They also have showed they care about there company, but I think they have waited FAR to late to try to get out of this. IF they make it out (and thats a BIG IF), I dont think we are done with their job cuts. I would look for 60% or more reduction in output/labor/factories (manufacturing). I would also try to keep dealers open ONLY in heavily populated cities, thus saving money through the dealer network.
IMHO they need to run a skelaton crew for a long while, perhaps 3 shifts of the bare minimum it takes to run an assembly line and perhaps only have output set to around 10 - 15% per factory.
Its clear it would take an idiot of a bond holder to accept the haircuts GM has offered...
Sure its drastic but we are talking the largest manufacturing company ever, thats in trouble and one hell of a problem for the US Economy if they fail.....
salty
Active member
Let 'em fall. Unless they get the billions or trillions like the crooked financial sector received, they are done as we know them.
Cut jobs, sell off or cancel divisions, make worthless promises. What kind of company does this, that is worth saving?
They have had 100 years to be the best, GM was the most profitable and biggest company in the world, 10 or so years ago. Now besides their equity they are almost worthless.
What is most of this being blamed on, economy, poor management, poor sales, etc.
It's bad insight and a coalition with oil companies and other behind the seen forces.
An electric car has being around longer than a gas car, hmmm, maybe they should have taken the last 100 years to think about a better future, instead of lining their pockets with money.
Take some time and watch, and then make your own conclusions.
Where did the EV1 go? Do you remember that car?
Who Killed The Electric Car - The Passionate Eye Sunday Showcase | CBC Newsworld
Cut jobs, sell off or cancel divisions, make worthless promises. What kind of company does this, that is worth saving?
They have had 100 years to be the best, GM was the most profitable and biggest company in the world, 10 or so years ago. Now besides their equity they are almost worthless.
What is most of this being blamed on, economy, poor management, poor sales, etc.
It's bad insight and a coalition with oil companies and other behind the seen forces.
An electric car has being around longer than a gas car, hmmm, maybe they should have taken the last 100 years to think about a better future, instead of lining their pockets with money.
Take some time and watch, and then make your own conclusions.
Where did the EV1 go? Do you remember that car?
Who Killed The Electric Car - The Passionate Eye Sunday Showcase | CBC Newsworld
Setec Astronomy
Well-known member
bwalker25 said:
salty said:
Well, I dunno about the last hundred years, but "strategy" (as in long term) rather than "tactics" (as in what can we do for the numbers this quarter) hasn't been in almost any CEO's vocabulary in the last 10 years.
It's truly sad, but I guess that's what happens when your top guy's aptitude and background is in ledger books and spreadsheets instead of in stamping presses and engineering drawings. I wonder if we would be having this discussion if Lloyd Reuss had been made CEO instead of Wagoner.
Big Leegr
Swirls?!?! NNOOOOOOO!!!!!
Well, looks like Chrysler officially is going for broke:
salty said:
Isn't that what Lee Iacocca did about thirty years ago? It worked once, hopefully whomever the new CEO of Chrysler is can pull it off again.
Al Dunlap did the slash jobs and divisions on Scott Corp to keep it from being flushed in the toilet.
Sometimes it works, sometimes it does not. Who knows this time.