Volt production has started, public sale moved forward to October

What part of the task-force assessment of "too little, too slowly" needs explanation?

The analogy of a sinking ship comes to mind. GM's bucket is too small and they can only maintain the effort for so long. When the water starts rushing in at a faster rate, then what?

In other words, as long as gas prices stay under $3 and the demand for competitive fuel & emission technology remains flat, they'll be fine. But later when that changes, what will they compete with?

Volt is unprofitable in its most competitive configuration. It also depends upon tax-credit money.
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And in addition to that, GM has said they cannot use the technology in a vehicle that is either bigger or smaller, so they'll never expand the Volt concept: It will never be more than a small 4-passenger car; it will never be more than one vehicle in their line-up.

Meanwhile, Toyota is committed to offering an HSD version of every vehicle it makes. And more and more companies are committing to building full-on electric vehicles.

 

How much does GM still owe the taxpayer ? 55 Billion or so ?

Call me when it is repaid with market interest rates.

 

The government owns about 60% of GM. That won't last forever. When GM gets back on its feet, they'll sell off their share and hopefully make a profit on that $60 mil.

It's interesting that, with the government going after Toyota for what appears to me to be frivolous things, they actually have a conflict of interest in owning a controlling interest in one of Toyota's competitors.

 

Forget market interest rates! Was there any interest on the "loan"? You can bet your booties it was not market rate.

Speculation in stock is always a risk. In the long term, the market has traditionally gone up. But individual stocks have become worthless when companies go bankrupt, and in the short term there are unpredictable fluctuations. And try selling 60% of a company! The price will plummet.

You can vote your Apple shares if you like. If you own a thousandth of one percent of the company, your voice is weak. But if you owned 60% you could name the entire board of directors. When you sell your shares you get the profit if the stock went up, but you take a loss if the share price went down.

Your notion that the government's 60% stake in GM will be worth more at some point than we paid is admirably optimistic, but it's more likely to be worth less, and we'll lose money.

In allowing the same old crooks to keep running GM, the government has chosen not to exercise its voting stock. And it is absurd in the extreme to assert blindly that we'll make a profit when we sell the shares. The whole point of the bailout was to keep this criminal and incompetent corporation alive. We paid far over market value for our 60% stake in the company, and the odds are we'll accept far below market value when we sell it back.

When was the last time you went to a broker and announced that you wanted to pay twice market value for a badly-run company because you were certain you'd make a profit selling it for half of market value a year later? And in the mean time you'd refrain from voting your stock, so the bad management could continue! Of course you would not. But that's basically what our government did. Except for the part about expecting to make a profit. The government knows this is not a profit-making deal: It's a graft and corruption deal to keep the GM crooks in their jobs with their astronomical salaries.

 

i had an epiphany last night. the problem is not gm, it's their customers! most of their customers want larger vehicles. when that base is reduced due to various reasons, gm's market share contracts. and then, there are not enough profits to keep up with their obligations. the volt will not save them, it is a figurehead only to government officials and the few people here that will switch from the prius. what they need to do is the same thing they've needed to do for the last 50 years. develop competitive small and medium size cars. they need more of the corolla/camry market. and that won't be easy with all the korean surge. are they even trying?

 

This is incorrect. The issue is NOT their customers. It is that GM has no or poor offerings outside of the big vehicle market.
You ended with this, but the beginning premise that is the 'fault' of the customers is wrong.
Markets change over time. If GM can't adapt it will go bankrupt again.

 

true, but it's like a drug. do you blame the drug or the junkie? when gas is reasonable, there are enough customers to keep them hooked.

 

Advertising is the flaw in your reasoning. Advertising works. If it didn't, it would not be a multi-billion-dollar industry. GM's advertising creates the demand for profitable gas-guzzling behemoths. The mother of a three-year-old believes the advertising lies and thinks her child will be safer in an SUV, and that trumps every other concern.

And of course, the criminals running GM don't care if the company goes bankrupt again, because they know the government will bail them out again.

 

Mil? We only wish it were that small. Per Taxpayers Unlikely to Recover GM, Chrysler Investment (Update2) - Bloomberg.com

Interestingly, GM's Exit From Bankruptcy 101 says

Not sure sure which figure it right and how the company's total was counted in Bloomberg's statement.

 

I thought you were supposed to be arguing against me.

 

i think GM will sell the Volt at a price more competitive especially since the Leaf pricing is public knowledge

 

age of article is irrelevant

It doesn't matter what the age of the article is... here's another tidbit:
G.M. Is Taking Taxpayers for a Ride - DealBook Blog - NYTimes.com

CNSNews.com - Taxpayers Unlikely to Recover $80 Billion Given to Chrysler, GM, GAO Says says the same thing.

http://www.gao.gov/new.items/d10151.pdf also has the same $66.9 billion on page 27 under "Equity value of company necessary to recoup investment (amount equity must be worth/60.8 percent for GM and 9.85 percent for Chrysler)".

And, really? GM has larger market share now? Are you talking about in the US? http://www.nytimes.com/2009/10/29/business/29auto.html and http://dealbook.blogs.nytimes.com/2009/08/05/gm-chairman-vows-to-defend-market-share/ talk about 20 or 21% and now http://www.businessweek.com/autos/autobeat/archives/2010/04/gm_pushes_for_b.html says

 

why does this remind me of the climate threads?

 

Many topics, diesel for example, go absolutely no where. They just endlessly persist.

It all boils down to sales & profit.

Marketshare doesn't mean much if money is lost in the process with no means to quickly change that... which is exactly what Volt faces. Making it profitable & affordable prior to the tax credit expiring is a major undertaking... which simply doesn't look realistic. How will that "nicely under $30,000" goal be achieved in just a few years?
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