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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: elmatador who wrote (5250)	4/4/2006 3:30:54 AM
From: Elroy Jetson	Respond to of 218632

GM was able to collect a net $10 billion from the sale of 50% of GMAC. If they sell the other 50% they will receive another $10 billion - and then they are out of major assets. GM's cost disadvantage per vehicle, relative to Honda and Toyota, is greater than their total labor costs! This means it costs GM more to manufacture a car - even if their employees worked for free and received no pay or benefits. I don't see how GM recovers from that. They need to design cars which are inexpensive to build and assemble, as Honda and Toyota do. GM has shown no signs that they understand how to do this, or even recognize this as their major problem. Their corporate history has been a long history of blaming their problems on their employees or the government. Currently GM thinks if only the government subsidized their health care costs, then everything would be fine. Totally clueless. They should begin by looking in the mirror. Personally I'm surprised GM was able to sell a portion of GMAC. The major portion of their business has been lending home owners 125% of the equity in their home. In the event of foreclosure that's a 25% loss in addition to foreclosure costs. I guess Citibank, the major lender in this deal, thinks this is not so risky. I wish them luck. .