GM loses $9 billion in 2005

[MRT144]

Originally posted by Kidicious


Why do you think he's doing it?

make a statement like a brat teenager would.

[Kidlicious]

You have to be rich to think like that I guess.

[JohnT]

Originally posted by Kidicious


The $23 billion bid wasn't a serious bid. Kerkorian was just trying to manipulate management. I have no idea why Kerkorian is trying to sue Daimler now. He doesn't have a case.

Actually, he lost the lawsuit.

[Kidlicious]

Ok, I'm doing some research on this now at school.

This is interesting. Kerkorian already got GM to appoint Jerry York to the board. This plan is York's. I don't know yet exactly how it's suppose to work, but it's suppose to generate lots of cash.

[JohnT]

Note that I'm talking about Kerkorian/Chrysler, which was in the 1990's, not Kerkorian/GM, which is this decade.

[Kidlicious]

Originally posted by JohnT
Note that I'm talking about Kerkorian/Chrysler, which was in the 1990's, not Kerkorian/GM, which is this decade.

I know.

This is the outline of the plan from a speech that York gave in January. It's not very detailed though.

York will urge management to follow these points from his January speech: (1) Match costs to realistic market share and revenue expectations, (2) cut product offerings, (3) review the entire company with a clean-slate perspective, (4) sell or close noncore businesses, and (5) instill a "sense of purpose."

-Fortune Magazine

[Dinner]

The only time car companies turn around is when they invest big in new product line ups and actually produce cars that people want to buy. Chrysler did that in the 1980's/early 90's Nisaan did that in the late 90's GM has just kept releasing a lot of bad designs; high quality bad designs but still bad designs.

Yes, cost cutting is important as is concentrating on core businesses but the bottom line is a successful car company needs to have cars people want to buy. Starting in the early 1990's GM let it's car line up rot and concentrated on big trucks and SUVs. Everyone knew that the SUV craze would one day end but GM's management was so obsessed with short term profits that they let the company's long term prospects go down the toilet. That's just bad management.

[Kidlicious]

I'm pretty sure GM isn't going to invest in new product developement. That would suck up a lot of cash. Notice that Chrysler didn't do much new product developement after Kerkorian became a major shareholder. The're going to sell it off piece by piece after they cut it down to the bone.

[Dinner]

You cannot cut a company to success. You have to invest in new product line ups or you'll just keep getting less and less market share. If GM's plan is just to asset stripe until the company ends up in bankruptcy then they're doing a good job other wise they're doing a crap job.

[Kidlicious]

Originally posted by Oerdin
You cannot cut a company to success. You have to invest in new product line ups or you'll just keep getting less and less market share. If GM's plan is just to asset stripe until the company ends up in bankruptcy then they're doing a good job other wise they're doing a crap job.

What is success? To investors it's getting a return on your investment. To managers maybe it's making a company strong, but when those to goals become incompatible the investors tend to win out. That's what happened to Chrysler.

[Ted Striker]

Originally posted by Oerdin
You cannot cut a company to success. You have to invest in new product line ups or you'll just keep getting less and less market share. If GM's plan is just to asset stripe until the company ends up in bankruptcy then they're doing a good job other wise they're doing a crap job.

They're just buying time and hoping for a Hail Mary