Dan

iTrader: (1)

GM Posts Record US Automotive Loss of $38.7B for 2007, Offers Buyouts to 74,000 US Workers


DETROIT (AP) -- General Motors Corp. reported a $38.7 billion loss for 2007 on Tuesday, the largest annual loss ever for an automotive company, and said it is making a new round of buyback offers to U.S. hourly workers in hopes of replacing some of them with lower-paid help.
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The earnings report and buyback offer came as GM struggles to turn around its North American business as the economy weakens.

But GM Chairman and Chief Executive Rick Wagoner said that the company made significant progress in 2007, reducing structural costs in North America, negotiating a historic labor agreement and growing aggressively in Latin America and Asia.

The Detroit-based automaker said it was offering a new round of buyouts to all 74,000 of its U.S. hourly workers who are represented by the United Auto Workers.

GM won't say how many workers it hopes to shed, but under its new contract with the UAW, it will be able to replace up to 16,000 workers doing non-assembly jobs with new employees who will be paid half the old wage of $28 per hour.

Ford Motor Co. and Chrysler LLC already have announced similar buyout offers.

GM shares fell 65 cents, or 2.4 percent, to $26.47 in premarket trading.

GM's annual loss of $38.7 billion largely was due to a third-quarter charge related to unused tax credits.

The 2007 loss topped GM's previous record in 1992, when the company lost $23.4 billion because of a change in health care accounting, according to Standard & Poor's Compustat.

Excluding the tax charge and other special items, GM lost $23 million, or 4 cents per share, for the year, compared with a net income of $2.2 billion in 2006, beating Wall Street's expectations. Analysts polled by Thomson Financial expected GM to post a full-year loss of 95 cents per share.

For the fourth quarter, GM posted a loss of $722 million, or $1.28 per share, in the fourth quarter, compared with a net income of $950 million in the year-ago quarter. Fourth-quarter charges included $622 million to Delphi Corp., GM's former parts division, for its restructuring efforts.

GM reported $181 billion in revenues for the year, down from $206 billion in 2006. Its automotive business saw record automotive revenues of $178 billion in 2007, up $7 billion from a year ago thanks to growth in emerging markets and favorable exchange rates.

GM was profitable in every region outside North America. GM's Latin America, Middle East and Africa division reported a record $1.3 billion in earnings, up 140 percent from 2006. GM's Asia Pacific division earned $744 million, up from $403 million in 2006, while GM Europe reported a profit of $55 million, down from a profit of $357 million in 2006.

But GM's North American division continued to struggle, posting a $1.5 billion loss for the year, nearly identical to its $1.6 billion loss in 2006. GM's North American division also reported a loss of $1.1 billion in the fourth quarter, compared with a loss of $129 million in the year-ago quarter.

Wagoner said the weak U.S. economy and high commodity prices hurt turnaround efforts in North America. He said GM's decision to reduce low-profit sales to daily rental companies by 110,000 in 2007 also affected U.S. sales.

"We're pleased with the positive improvement trend in our automotive results, especially given the challenging conditions in important markets like the U.S. and Germany, but we have more work to do to achieve acceptable profitability and positive cash flow," Wagoner said in a statement.

GM's results also were dragged down by its 49 percent stake in GMAC Financial Services, which lost $2.3 billion in 2007. GM reported a $1.1 billion loss attributed to GMAC.

GM barely retained its title as the world's largest automaker in 2007, selling just 3,000 more vehicles than Toyota Motor Corp. GM sold a total of 9,369,524 vehicles worldwide, up 3 percent from the year before.

MeentSS02

iTrader: (11)

So our wonderful labor unions are helping to drive an American icon in to the ground...that and *** holes like me that buy a Toyota for a daily driver. Such is life I suppose.

bboyferal

iTrader: (9)

^ LOL

Consumers can't make their purchasing decisions based on what's best for a particular brand of industry; they have to make them based on what's best for themselves, individually, viz. I bought my Trans Am because I like the car, not to help Pontiac/GM/economy/America/etc.

Let consumers make their decisions, and some manufacturers will rise at the expense of another's... You are definitely right: "Such is life," such is business.

Oh, and I'm an ******* too... I'm a HUGE Mitsubishi/Dodge 3/S fan.

GM needs to do better... I can't think of any vehicles of theirs that I like except for the Corvette... And the new Camaro, of course.

DrkPhynx

The Solstice rocks. The G8 is a great sports sedan (I don't like sedans, but I like that car). The CTS base model is a killer ride with the DI V6, and the -V is insane. The XLR-V is awesome.

Even the G6 coupe would make a great DD, and the G6 Hard Top 'Vert is just slick (if it was RWD it would be awesome).

And of course they are tops in the gasser power train world. And with their new 4.6 Turbo Diesel designed to fit in the same places the LS1 does, they are poised to take the lead there too. (to say nothing of the DI V6 in the CTS, another great engine)

I think it's hard not to find something to like from GM.

bboyferal

iTrader: (9)

I'm glad you like them!

I think they look horrible, IMO.

The new Caddy's you mention look great of course... But that division will not save GM... It's a luxury line, not the bulk of GM sales... Not everyone wants a luxury sedan or could afford them.

The cars they should be depending on, like their entry level sedans, mid-size, and their economy cars are reliable, but not appealing... I personally find their entire Pontiac line disgusting and/or boring. Most, including me, would pick a new Camry or Accord over their American counterparts.

Buicks... *snores*

Oldsmobile... *comatose into flatlining*

At least they have nice trucks...

Long live the Vette baby! As long as there's the Vette, I'll always be happy.

The Camaro too, but I'm too much of a hardcore Firebird guy.

mzoomora

iTrader: (36)

Buick is actually doing well, so they must be appealing to somebody. They had to increase their production of the Enclave by over 40% to keep up with demand, and they were the fastest growing and best selling brand in China- so even the Asians like them. Plus they were the No 1 brand in long term reliability.

Oldsmobile is gone already. They were an overlap with Pontiac and Buick anyway, and they were both stronger and better selling.

I think the best candidate to get rid of is GMC. The truck and van sales would almost completely go to Chevy and the rest could be absorbed somewhere else. The Acadia is good looking, but you also have the Outlook and Enclave. The GMC Sierra is better looking than the Chevy IMO, so maybe they should just call that the new Chevy.

The new Malibu and Aura are very nice cars in person and should do well. The Aveo is hideous and looks just like an import to me, so I cant imagine it is doing to well. The Cobalt is good as a platform, and not bad looking, but needs a redo. So yeah, their cars could use some help

Slick02WS6

Personally after going to the autoshow with a completely open mind, found better replacements for my cars than I thought. Prices seem to be completely crazy, every car I looked at seemed to be either mid 30's to low 40's. I dont know if its just me but 35k for a turbo solstice that a gallon of milk has to ride shot-gun?? I just dont see how GM could stand to make up any ground having models that dont stand out. I was looking at a G8 until I found a BMW 3 series for the same money. I could care less how fast it goes...I'll still get from point a to point b. I want something rear wheel drive and I keep looking at other brands. Dodge, Chrysler, Jeep, bmw, benz all have rear drive models and several to pick from. What does GM have??? Corvette at 50k+ and the Camaro thats going to be a 50k car for the first year or so. If I was looking for a truck GM has a lot to pick from...since I want a car with leg room, store 4 sets of clubs, rear drive and be comfortable....looks like they dont have an answer for me.

As far as Caddy is concerned....the more I see what they're up against the cheaper they look. The CTS is nice, but the benz and BMW counterparts are better. Not to mention the incredibly large loss you take on one once you buy it. If GM would stop wasting time on stuff like the V series we might have nice cars to look at. Who in their right mind needs a supercharged full size DTS for 80k. I dont think I've seen one on the street ever....It just seems the more and more I look at them they seem to be the poor mans luxury car. I could afford the XLR all day long but the highlights they brought to my attention as the reason for the price didnt thrill me. Does anyone really care if their car has radar controled cruise control?

suprastars

The Malibu is a nice upgrade from previous years, but sales are still slow for this model. In 07 GM sold 9,209 Malibus, it's pretty safe to assume that probably 75% of those were sold to fleet customers (that means they sold ~6900 to fleet and ~2300 at retail level). In 08 they sold 14,541 and GM claims retail sales were 198% higher than the previous year. That would put retail sales this year at ~6854 (not very impressive) and fleet sales at ~7687 an increase of ~11.5%.

DrkPhynx

I'm 6'2", 220lbs with an average build and I fit in a Solstice just fine. Hell, I fit in a Miata. So the whole gallon of milk thing is a bit over board (and if you mean trunk space, there is actually usable trunk space, even with the top down. But.... I don't take my WS6 to do mundane tasks, that's what a DD is for, and the Solstice, being a 2 seat roadster, is every bit as much of a toy/fair weather car as my WS6 or a Corvette (especially 'vert))

Also, the GXP (turbo) is $28.5G (roughly), where are you getting $35G from?


a to b is basic transport. Why get high performance unless you WANT _high performance_? And if so, that necessarily pushes "a to b" aside.

The BMW isn't all it's cracked up to be. The G8 is a better powertrain, and likely to have fewer issues and last longer (built like a tank for the Oz backroads). The false-charger and 300C are doing fairly well too, and I doubt someone wanting a 3-series would be looking at a false-charger as an alternative. The G8 will be playing in that space. (with the false-charger I mean)

As it was, Clarkson called the Monaro a "cut-rate 3-series", and essentially a better deal. And they like the Commodore too.


GM has plenty of great RWD options and will only be bringing more and more on. I still find it odd to look for "something RWD", as though that's all that matters. Like the Mazda 3 vs Corolla commercial where the guy says he was going to buy a Corolla until he found the Mazda 3 had more interior room, and got better reviews. That's how you shop for appliances, not cars.


Corvette, XLR, Solstice(/sky), G8, CTS, STS (also AWD), SRX ("Crossover", RWD or AWD), and quite possibly a Ute in the near future.

That's a decent number to be totally fair.

What does Chrysler have? Challenger, false-charger, 300C, and Magnum? Not as many. Although the SRT 8 Jeeps are bitchin' and the Challenger does rock muchly.

Also, on a side note, if puttering around town, basic commuting ("a to b"), and hauling goods and groceries is all that is desired, along with a bit of a performance kick, why does RWD matter? Many FWDs are fast and in 99% of all driving conditions you won't notice any difference (and in the snow you'll only notice the benefit).


STS or SRX. And G8 I would have to beleive as well.


Well.... The CTS looks better (opinion, yes), helps the US in the end (but most want to ignore that, so ok), has more HP (and a better P:W ratio [12.7lbs/hp vs 14.8lbs/hp]), more front head room (same rear) (no info on 3-series legroom), and according to reports is every bit as much of a blast to drive (even more so with better P:W ratio, one would have to assume).

The features and goodies are on par as well. It really doesn't look so bad.


Ah.... and there's the key.

Never buy a car with plans to sell it. Cars are money pit, not an investment. Buy a car you want to keep forever and re-sale value is irrelevant.

Also, the only reason value tanks is because people won't buy them in the first place and insist that they are inferior (they aren't, really). Buy them, and demand goes up and re-sale along with it. It's a self-feeding cycle.


S-Class buyers seem to.

How much does it take to slap a s/c on a car? Basically nothing, so how is that in any way a waste of time?

The V-Series rocks. XLR-V and CTS-V in particular. The CTC will kick ***, and once the CTC-V comes out, look out.

mzoomora

iTrader: (36)

Do you honestly believe that they sold 75% to fleet sales? Making an assumption that 3 out of 4 Malibus on the road are rental and/or municipal is ridiculous.
Also I assume you are talking about Jan. numbers only since you cant possibly quote the whole 08 sales year. They sold 5332 more cars by your numbers, or 73% more cars while reducing fleet sales- how the hell could you say that is not impressive. They also intentionally cut fleet sales to focus on higher profit retail sales which makes the numbers even more impressive.

mzoomora

iTrader: (36)

http://www.cheersandgears.com/forums...62#entry331066

"The Malibu had been GM's most fleeted car but going forward the company intends that only 20 percent of its production output will be sold to rental car companies, compared to 40 percent of current Malibus."

TriShield

GM's management is also doing their fair share in destroying the company.

GM has 8 brands, 50+ models, thousands and thousands of dealerships and workers, and numerous plants. It's still structured like a company that owns over 50% of the US market when in reality they own less than 26% and falling.

Do the math. The market isn't supporting the structure, there are established brands with better reputations doing what GM brands used to do, things need to give.

MeentSS02

iTrader: (11)

There is no way you can be any sort of engineer...am I correct in that assumption?

MeentSS02

iTrader: (11)

That's too bad...as of late, rental cars are about all GM cars are worth being. Boring, and not even that much fun to drive into the ground.

chromeplated500

iTrader: (10)

Ha i was gonna start somethin like this after I heard. seems kinda weird.... all the high paid people need to work a lil harder.

mzoomora

iTrader: (36)

Well considering that the new Malibu sales are up 73% while limiting fleet sales it would seem that there are many people who disagree with you.

Also, would you say that the Accord or Camry are fun to drive? I would say no, and I have driven them. But yet they are the best selling cars out there. Fun to drive is good for some, but practical and nice cars sell.

suprastars

Fun to drive is purely subjective. But overall, the performance and looks of both Camry and Accord, far exceed anything the Malibu has had to offer. Furthermore, the reason why they are the best selling cars in their class.

The new Accords(especially coupe) look 10x better than the Malibu.

2001somws.6

iTrader: (1)

But the entire pontiac line is disgusting and/or boring. Go buy a camry my dad will sell you his so he can get a malibu.

Rhedalert

iTrader: (21)

eh.... Bring in the newbies and out with the Old. Maybe GM will turn a profit before turning to the Chinese

mzoomora

iTrader: (36)

Everything you stated is pure opinion and bias. In measurable categories the Malibu stacks up really well or excels, including performance. In no categpries except sales do they "far exceed". As far as looks, the Accord took a step down. The front looks like a half mix of the Ridgeline- which is hideous. The Accord coupes have always been cleanly styled cars, the new one is ugly. I also dont think the Camry looks better than the Malibu (definitely doesnt "far exceed"), but it looks better than the Accord.