Gm Going Down?

[PHATR32]

http://news.bbc.co.uk/2/hi/business/4461168.stm

if it happens, wheres holden gonna get its engiens from? nissan? ford?

[Patto-]

There are many forms of bankruptcy.

GM will continue to trade as normal, though it will probably close a number of plants and end some of the less profitable brands that it owns.

The problem is a union deal struck decades ago that makes it more expensive for GM to close an unproductive manufacturing plant than to keep it open. The aim of this deal was to stop GM workers losing their jobs when plants close, though it is now very bad for the whole company.

As well as this GM has to pay way more medical and other benefits to its employers than the competition. This means other companies (especially Japanese) can provide cheaper prices for cars. I think about $1600 of every GM car sold goes to employee benefits.

This deal with the unions is the major factor in GM's downfall, if they can file for a form of bankruptcy that allows them to cancel unions deals they may be able to get back on their feet. Because apparently GM have been negiotating to rewrite the original deal with the unions in order to save the company, but the unions aren't being very helpful.

Edited November 23, 2005 by shyster

[Cubes]

Interesting...

Imagine the ruckus if Holden began using Ford motors.. lmao.

Edited November 23, 2005 by Cubes

[predator]

no fuss.. isn't 60% of the next commo going to have korean parts anyhow?

when i see a commodore with a Hyundai engine I know the end is complete

[drunkenmaster]

Dont you think if GM went under (which will never happen in the near future), that Holden would follow suit?

GM is a little more to Holden than just an engine supplier

[Josh]

interesting

[Coupe-This]

Hmmm very interesting, seeing as holden is apart of gm i thought, aka gmh (australia) gmc (america)

Being holden and chevrolet

Haha, i dont see holden geting nissan engines anytime soon, would be mega funny to pop the bonnet on a new ss and see the "boss" motor in there. And the person get abused for doing such a transformation, thus replying, it comes out of factory like that :s... hmmm

[dangerous_daveo]

There are many forms of bankruptcy.

GM will continue to trade as normal, though it will probably close a number of plants and end some of the less profitable brands that it owns.

The problem is a union deal struck decades ago that makes it more expensive for GM to close an unproductive manufacturing plant than to keep it open. The aim of this deal was to stop GM workers losing their jobs when plants close, though it is now very bad for the whole company.

As well as this GM has to pay way more medical and other benefits to its employers than the competition. This means other companies (especially Japanese) can provide cheaper prices for cars. I think about $1600 of every GM car sold goes to employee benefits.

This deal with the unions is the major factor in GM's downfall, if they can file for a form of bankruptcy that allows them to cancel unions deals they may be able to get back on their feet. Because apparently GM have been negiotating to rewrite the original deal with the unions in order to save the company, but the unions aren't being very helpful.

<{POST_SNAPBACK}>

So in the end, the unions are going to be the worst thing for the employes, as they will all be out of work! I love unions!

[xRHETTx]

I dont think its right to blame this on the unions (as GM would want to)

How about not trying to increase profits every year by crazy amounts?

Im sure if you were a mechanical assembler in an engine plant spending all day putting a particular nut on a particular bolt getting paid $30k a year you'd probably want a better deal too...

How about the company (or its shareholders really) saying "we'll forego trying to increase our investment return this year, instead its more important for the community as a whole for these 30000 people to remain employed"

Although i cant see that ever happening, its nice to think it would...

[Patto-]

It is the agreement with the unions that is bringing GM down. I beleive the agreement was made in the late 70s when GM was considered invincible. Unfortunately the world has chnaged since the 70s, more competition from more efficient Japanese manufacturers. GM is not alone, Ford apparently has huge troubles as well, though not quite as bad as GM.

GM is struggling to stop huge losses every year, not trying to make a profit. Part of the problem is that they have no money to invest as it is all tied up in employee benefits.

Obviously the idea was to get the best deals for the employees, but it is having a terrible effect on GM and as such results in job losses. It is inevitable that changes have to be made before GM gets into even worse trouble.

[Patto-]

I was wrong it was $US 3500 from the price of each car sold. This article explains it more clearly:

http://theage.com.au/text/articles/2005/11...2421602934.html

[dangerous_daveo]

I dont think its right to blame this on the unions (as GM would want to)

How about not trying to increase profits every year by crazy amounts?

Im sure if you were a mechanical assembler in an engine plant spending all day putting a particular nut on a particular bolt getting paid $30k a year you'd probably want a better deal too...

How about the company (or its shareholders really) saying "we'll forego trying to increase our investment return this year, instead its more important for the community as a whole for these 30000 people to remain employed"

Although i cant see that ever happening, its nice to think it would...

<{POST_SNAPBACK}>

The point of the business is to make money, just like every business, if the shareholders aren't making money, then its no longer a good investment, and they invest elsewhere. I do belive an employee would rather $30k pa over no job.

If by some chance of a major stuff up GM goes broke, I belive that would have a MAJOR effect on the world. They are a massive company, the flow on effects would also be major.

[scathing]

Dont you think if GM went under (which will never happen in the near future), that Holden would follow suit?

Holden Australia is still profitable (one of the few GM divisions that is). If push came to shove, they could sell Holden off and they'd find buyers. The brand has cachet down here, and is getting traction overseas. I could see Volkswagen snapping it up. Which, in my mind, would be a great thing since it would then also mean Holdens would have to get built to VW-like quality.

If I could get a big sedan with great build quality that's still RWD, and a V8 that wasn't a lucky dip when it came to engineering tolerances, I wouldn't mind it.

Until Lutzy took an interest in the fact that Holden was making good profits from a modest budget (by GM terms), Holden was little more than some frontier office in a backwater.

As such, its been run relatively autonomously to GM Global (so it hadn't had to comply with a lot of GM processes and standards)...which ironically has been the best thing for it, if you look at how most of GM's "watched" divisions are doing.

[Amaru]

I dont think its right to blame this on the unions (as GM would want to)

How about not trying to increase profits every year by crazy amounts?

Im sure if you were a mechanical assembler in an engine plant spending all day putting a particular nut on a particular bolt getting paid $30k a year you'd probably want a better deal too...

How about the company (or its shareholders really) saying "we'll forego trying to increase our investment return this year, instead its more important for the community as a whole for these 30000 people to remain employed"

Although i cant see that ever happening, its nice to think it would...

<{POST_SNAPBACK}>

If they dont focus on increasing profits every year, investors have no reason to stay invested in the company. If the investors pull out, guess what? The company is worth $0.00. The point of investing is to get as much money back as possible... if I invested in a company and they turned around and said "were not focusing on making a profit this year" I know id be selling straight up. Why would I want $10,000 of my money sitting in a company doing stuff all for me?

Unions can be good, but in this particular case they are going to be the possible downfall of what once was the largest company in the world (pre-Microsoft). It really pisses me off when unions cant agree with the employer to a new agreement, and as a result the company closes down and the employees whinge ""wah wah im so hard done by"" not realising, ultimately, they were the oens that caused it.

Edited November 24, 2005 by Amaru

[mcnamg]

Holden would probably fare ok if they can get the VE commodoore funded before gm goes belly up so that they can secure their future in australia and allow them to continue their exports to the middle east and their push into china. The main effect on their exports might be having to rebrand their non holden badged exports overseas to holden instead of possibly defunct gm brands

holden makes their own hfv6 engines and sources the heads out of mexico currently from one of the gm plants there but i am sure if gm pulled up stumps holden could shift production to a different source such as daweoo in korea.

dont know what hey would do for a v8 though i suppose there would be some cheap manufacturing equipment on sale in the us that they could snap up to switch production to local

i thought that the way the buyout of daewoo was structured holden had controlling interest in the company so i guess if the worst happens holden may be able to hang onto daewoo as well.

my 2c anyway correct me if i have got the facts wrong

i guess we wait and see only time will tell gm's fate

Edited November 24, 2005 by mcnamg

[scathing]

One of my colleagues has a HSV GTO.

He's up for a new gearbox, uni joints, and diff. The car's not that old, either. 3 years at most.

Like I said, if Holden could get build quality like a decent manufacturer...with the way a Monaro goes (and its got Kazama's thumbs-up), and how horn they sound with a 3" mandrel bent, they'd definitely be a car worth owning.

Edited November 24, 2005 by scathing

[Patto-]

One of the ways GM is avoiding bankruptcy is by expanding into China. The main vehicle for this will be the Buick, based on the Commodore. As you would know Statesmans are sold in the Middle East and Monaros in US and UK. Holden is one of the major suppliers of rear-wheel drive platforms for GM brands around the world. Holden has controlling interest in Daewoo, which has turned out to be a bargain for GM, as it seems that it won't take much until it starts turning a profit, if it hasn't already. So it would not make any sense to let go of Holden or Daewoo.

Also it is very unlikely that GM would collapse all together, but some serious restructuring needs to take place. Most of GMs problems are in North America, so I believe most changes will take place in North America, therefore Holden and others will be quite safe.

Though it is nice to dream about HSVs built to German quality standards.

[drunkenmaster]

Buicks have been built in China for quite a few years now, along with some VW/Audi.

USA bankruptcy is fairly different than Australian bankruptcy.

[Patto-]

Yes, theres nothing new about GM's expansion into China, and there is nothing new about GMs financial situation.

I was just pointing out the use of Holden in other markets, and GMs hope that the Chinese market will save the company from bankruptcy.

[CEF11E]

dont know what hey would do for a v8 though i suppose there would be some cheap manufacturing equipment on sale in the us that they could snap up to switch production to local

i guess we wait and see only time will tell gm's fate

<{POST_SNAPBACK}>

We don't have a big enough market to start local production on any sort of cost effective scale for the V8, we would need to be exporting more than we would use locally. We would be getting a daewoo engineered V8 imported, LMAO...