Comments on: GM reports $42.84 billion loss in 2007

By: tran

tran — Sat, 23 Feb 2008 13:42:07 +0000

The best car in the world is the Toyota Corolla! It is cheap and is the best drive! haha Who cares about GM!

By: Joel

Joel — Thu, 14 Feb 2008 02:58:34 +0000

Eitherway – GM, Ford and Cyrsler have no one to blame but themselves and i have absolutely no sympathy for them what so ever. Thier past orragance has come about to bite them in a very harsh and swift manner. Serve themselves right as this world without GM would be no lose.

By: dlr1

dlr1 — Thu, 14 Feb 2008 02:52:00 +0000

Joel- you’re preaching to the choir man!

I agree, manufacturing practices, corporate structure, brand image… there are more issues than you can point a stick at.

These can be all be changed, but the cost on the books of one or two generations of past and current employees will be felt on their balance sheet for the next 30,40 or 50 years.

The only way out of this is to declare bankruptcy and recieve US chapter 9 bankruptcy protection. But this is hardly going to help the other areas… consumer sentiment especially.

Its a long hard road ahead… one they may not survive in their current form.

By: Joel

Joel — Thu, 14 Feb 2008 02:36:40 +0000

Godspeed – Toyota owns Lexus and Scion while having controlling interest (52%)in Diahatsu and Hino with shares in Isuzu, Yamaha, Subaru and Denso.

Dir1 – it is not just the expense of employees but also the rather inefficent and poor structure of GM in general. For years they many laughed at Toyota’s Kaizen practices but now others including those outside of the automotive market strive to achieve the same efficiencies based upon a similar model. Toyota were decades ahead of the Americans.

By: dlr1

dlr1 — Thu, 14 Feb 2008 00:41:00 +0000

The reason the business models of so many non-US auto companies work is that they were never subject to the wage and condition negotiations of the once powerful UAW union in the 60s, 70′s and 80′s.

It is estimated that Ford now faces a cost of about US$2000 per vehicle to pay the retirement and health benefits of its past employees!

GM and Chrysler also face similar problems. Its not just a case of paying your employees less per hour, but having employees that won’t cost them money AFTER they retire.

This is why despite selling large numbers of vehicle, having profitable foreign brand and very profitable finacial arms (ford credit GMAC ect) they still are considering bankruptcy from the costs associated with their past and some current employees.

The cost to them is not just the $30 or so dollars an hour they pay their factory workers now and in the past but the tens of thousands each may cost them per year in retirement.

Firms like Toyota and BMW ect donot have anywhere near as many US employees on wage deals like the US big 3.

By: Godspeed

Godspeed — Wed, 13 Feb 2008 23:38:24 +0000

So why does the business model of car makers such as, well, particularly Toyota, work, when they are virtually one company and do not have any subsidiaries (you might include Lexus but that’s about it, possibly Daihatsu?), and the business model of GM and Ford does not – both have bought up as many brands as they possibly can and have tons of subsidiaries (Ford: Ford, Lincoln, Mercury, Mazda, Volvo, Jaguar, Land Rover, and previously Aston Martin; GM: Chevrolet, Buick, Pontiac, GMC, Saturn, Hummer, Saab, Cadillac, Holden)…

By: Tom

Tom — Wed, 13 Feb 2008 10:42:28 +0000

To answer above, what happened is GM had stored up $38.1 billion worth of tax credits over the last umpteen years, which can be used to offset the tax paid on profits made by the company. However they only work on the tax you would normally pay on company generated profit, and they are only valid for X many years, and last quarter they expired because GM hasn’t been making enough profits to use them.

Thus as far as assets go, GM ‘lost’ $38.1 billion, however excluding that special charge, on its operations it made $553million in profit, mainly from last quarter.

By: Andrew M

Andrew M — Wed, 13 Feb 2008 09:25:11 +0000

hang on this thing contradicts itself……..

“GM’s global operations has just reported a record net loss of $38.7 billion ($42.84 AUD) for all of 2007.”

and then it says……..

“GM’s worldwide automotive operations were actually profitable last year, making $553 ($612 AUD) million”

what am i missing people???
one paragraph says a billions lost and the next says millions in profit???? WHAT THE????

i think what it means is they are hiding the real profit perhaps?

By: mark

mark — Wed, 13 Feb 2008 09:25:03 +0000

well they have mastered sub-par cars now time to bring in sub-par workers! goodbye consumer confidence. The reason why GM, Ford and Chrylser aren’t making profits is because the are devoloping to many cars for to many brands for different markets! its called globallizing. if they do this then they will get a better return for investment. Look at the main jap brands that are doing so well, they have 2-3 brands globally and for example GM have 5 or 6 brands just for the nth americian market. Now how many of these brands cars are exported out of north americia?

By: golfschwein

golfschwein — Wed, 13 Feb 2008 07:42:01 +0000

It seems very careless. I’d be terribly cross with myself if I’d lost this amount of money.