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GM preparing for bankruptcy

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posted on Apr, 7 2009 @ 12:59 PM
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NEW YORK (CNNMoney.com) -- Preparations for a possible bankruptcy filing at General Motors have become "intense and earnest", according to a source familiar with the company's plans.

The source, who spoke on the condition of anonymity, said GM still hopes to win concessions from its creditors and unions that will allow it to avoid bankruptcy. But the June 1 deadline given to the company by President Obama and the Treasury Department to reach deals or go into bankruptcy has caused a pick-up in preparations, the source said.

"We're talking about what could be the largest industrial company to ever go bankrupt. The preparations better be intense and earnest," the source said. "The preparations are being made because there's a short time frame here."

money.cnn.com...
Who could imagine a half a century ago that one of the largest automakers in the world would be put on a life support shortly after the new millenium takes control of the calendar.

I don't believe that American engineers are less talented than anyone else and can't design competitive cars. Since they are subordinate to the suits, they need to follow orders and suggestion from them. I guess Detroit has been taking some lessons from Wall St. financial wizards -- those who opened the door to the financial unrest of late -- how to make a quick buck. Detroit tossed the roulette ball, but put the chip on a wrong number.




[edit on 4/7/2009 by stander]




posted on Apr, 7 2009 @ 01:16 PM
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This is more from the economic decisions made by the company than the technical expertise in making cars.

For too long, they made big profits on marketing cars that had big engines, SUVs packed with extras and pickup trucks that ride like luxury cars. These were big profit makers for GM.

Once the price of gas went up, you couldn't give those vehicles away. Now, we're in a recession. Who is going to pay top dollar for a car that gets bad mileage?

Also because business was so profitable, GM made concessions to the Unions. A lot of those dealt with retirement benefits.

Now, GM will be forced into reorganization. They will have to come up with plans that will allow them to continue to function as a company.

Personally, I think that many Union benefits will be reduced including the retirement to former employees. I also think that they need to get rid of a lot of the senior managers who have led the company to this point.

I don't think that GM will go by the wayside, just that it will under new management.



posted on Apr, 7 2009 @ 01:30 PM
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reply to post by stander
 


Massive news - thanks for posting. A very dark day if true.

It's not the cars that worry me. There has been global overcapacity for far too long. It's the jobs - not only those at GM, but also those at their suppliers. We're talking unimaginable figures - and not just in the US, either.

Spare a thought for all those families plunged into turmoil through no fault of their own. Tragic.



posted on Apr, 7 2009 @ 02:14 PM
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Originally posted by pause4thought
reply to post by stander
 

It's not the cars that worry me. There has been global overcapacity for far too long. It's the jobs - not only those at GM, but also those at their suppliers. We're talking unimaginable figures - and not just in the US, either.


Yeah, you're 100% right. This is bad. Certainly not unexpected; but very, very bad.

If Chrysler doesn't pull off that merger, then with the way these companies are connected through suppliers, they could easily be drug over the cliff along with GM.

And if GM, Chrysler, and a crap-ton of suppliers go into bankruptcy, then due to the interconnection between these companies, they could take Ford over the cliff with them...

Then their mangled remains get sold to Lockheed or some other defense-industry firm.

This could have an impact on several million jobs, in an absolute worst-case scenario.



[edit on 7-4-2009 by theWCH]



posted on Apr, 7 2009 @ 02:25 PM
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The Real true behind the down fall of US born car industry.

Is people that blame from unions to the misconception (thanks to millions of propaganda that foreign is better), while the automakers are losing and are about to die at least in the US, ( they are quite fine oversea), our own government is to blame, Free trade without restrictions is to blame and capitalism going corrupted is to blame.



As it currently stands the United States government – on state, local, and federal levels – has given billions of dollars over generations to foreign automakers to come to the U.S. and put our companies out of business.   
      
Before the government stepped in to save the Big Three it had already been propping up Toyota, Honda, Nissan, BMW, Mercedes and many others for decades.  We have given tax incentives, public funding, and other kick backs to these companies in our push to keep “free markets” in the U.S.  You would be hard-pressed to buy a GM, Ford, or Chrysler vehicle in Japan, but Japanese vehicles are the top sellers here in the U.S.  You can buy a Big Three car in most of Europe, but those cars are made overseas without the tax incentives we give foreign companies.   


American tax payer money has been used to help accelerate the downfall of the US automakers for decades, billions of dollars has been given away for foreign competition.

We the American consumers have failed them.

Rest assure that while they will become part of America history when they die they will keep doing well oversea

www.economyincrisis.org...

[edit on 7-4-2009 by marg6043]



posted on Apr, 10 2009 @ 06:11 AM
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Here is a two-part list of made-in-Detroit cars that the author of the list believes were partly responsible for the lean times of the US auto-making industry.

1) autos.yahoo.com...

2) autos.yahoo.com...

The biggest offender on the list is the notorious "flaming" Pinto born in 1978 -- a virus that might have infected the entire Detroit fleet to come. Maybe that's why the US car makers are more comfortable with traditional "big cars."



posted on Apr, 10 2009 @ 06:41 AM
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I find it insane that the last bastion of real industry in the US is told by the administration to become solvent or face bankrupcy, and the horrors associated, while the large financiers such as AIG that are instrumental in this collapse are given a no strings blank check.

Message = middle class can wither and die while zombie banks must remain on life support, at the expense of said middle class.

Conclusion = elities work for their own interest while posing as saviours...as always.

Solution = grass roots non violent movement that peaceably identifies insane elites and arrests them and expunges their odious debt.



posted on Apr, 10 2009 @ 07:02 AM
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Ok, So here is the 15 Billion dollar question. Since they are going into Chapt 11, are we going to get our 15 billion dollar bail out money back? Or did we just put a match to it?

[edit on 10-4-2009 by drummerroy39]



posted on Apr, 10 2009 @ 07:05 AM
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Originally posted by Neo_Serf
I find it insane that the last bastion of real industry in the US is told by the administration to become solvent or face bankrupcy, and the horrors associated, while the large financiers such as AIG that are instrumental in this collapse are given a no strings blank check.

Well, there have been other folks asking Bernanke questions about that and similar issues:
www.pbs.org...



posted on Apr, 10 2009 @ 07:54 AM
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Another slap on the faces of America and the US auto makers, I truly believe that in our nation is forces working to destroy us all.

Don't clap yet, as everything that is lately coming from our government is deceiving and while it may sound good actually its geared to make us nothing but servants to again foreign nations.

After our Government told the Big 3 and specially GM that they needed to build more energy efficient cars they go around and this what they do.


America Needs Electric Cars, But Not this Way

Norwegian electric carmaker Think announced last month that it intends to build a manufacturing facility in the U.S., thrusting eight states in a race to the bottom to offer the most alluring incentives to attract the company’s factory.

That could be a costly venture for Detroit’s already beleaguered Big Three automakers, however, putting them in direct competition with the Norwegian start up that is sure to be afforded with huge advantages in the form of tax abatements, free land, government-funded training for employees and use of federally subsidized power among other incentives.


greenwombat.blogs.fortune.cnn.com...

We are a nation with up 25%percent unemployment we are under foreclosures and in personal debt, this idea looks like a great deal for those looking for jobs, but remember that when this foreign companies come to the US they bring baggage because the US works visa, they bring lower wages and in many instances under the par time options they don't have to offer benefits.

We as a nation are reversing our standards of living our middle class is almost obsolete and Dependant on government hand outs.

The future of the new America is not pretty.



posted on Apr, 10 2009 @ 11:29 AM
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Government Motors / Obama Motors releases a new GM model for you to commute in.

media.gm.com...
gm.wieck.com...*query?ProjectPUMA&source=all&page=1
www.segway.com...



posted on Apr, 10 2009 @ 02:31 PM
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Good. Good riddance. It's an obsolete cash drain and I don't want a single, solitary dollar more to go to this failed enterprise.



posted on Apr, 13 2009 @ 01:34 PM
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An update on the GM struggle to stay in business:


GM shares slump as bankruptcy fear grows

news.yahoo.com...

As the article says, the company operates on borrowed money from the government that borrowed the money from the taxpayers and has till June 1 to submit a comprehensive plan to remedy the situation. That means . . .


The automaker is under pressure to cut $28 billion of unsecured debt by two-thirds, turn half of its remaining payments into a union healthcare trust into equity rather than cash, and reduce hourly wages and benefits to match those paid by foreign automakers.


I wonder how the UAW mafia would react to these proposals. It seems that the heydays for Joe Ratchet are over.



posted on Apr, 13 2009 @ 08:51 PM
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They could probably do without this right now....

news.yahoo.com...

Talk about getting kicked while you're down



posted on Apr, 14 2009 @ 01:54 PM
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Originally posted by Curio
They could probably do without this right now....

news.yahoo.com...

Talk about getting kicked while you're down

Gee, I didn't know that GM has still 1.5 million cars on the road. That's not a bad figure.




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