billy3esq
billy3esq Dork
11/14/08 8:35 p.m.

I don't think it's nonsensical for a car maker to have an upmarket/luxury brand if there's truly different content in the cars that share a platform (e.g., the Lexus ES vs. the Camry).

That said, GM is an absolute mess of redundancy and lack of focus. Ford is almost as bad. I think if Ford got rid of Mercury and GM got rid of everything but Chevrolet and Cadillac they'd be on the right track.

TJ
TJ New Reader
11/14/08 8:56 p.m.

Here's what I'd keep.

GM

CTS and CTS-V Corvette Silverado Malibu Full sized van Astra Vue

Ford

F-150 Edge Full size van Mustang Either Taurus or Fusion bring the new Fiesta here

TJ
TJ New Reader
11/14/08 8:58 p.m.
billy3esq wrote: That said, GM is an absolute mess of redundancy and lack of focus. Ford is almost as bad.

Ford does have a focus.

yo vanilla
yo vanilla New Reader
11/14/08 9:04 p.m.

I don't think cutting model lines is neccessarily the easy solution. Nor do I think that consolidating models under one brand is the fix either. Both should probably should be done regardless, but its not the fix to keep the companies afloat. That's not what's going to keep them from running out of money in the next few months.

I almost think they need to fail. Go bankrupt. First thing that comes to mind is "oh noes, they'll take the economy with 'em", but I think what will really happen is a healthy company will buy them up. Like Toyota, remember a year or two back there was a GM-Toyota buyout rumor? New ownership is probably the only way to make GM turn a profit again someday.

Apexcarver
Apexcarver SuperDork
11/14/08 9:19 p.m.

couldnt they reorganize under chpt11?
settle debts and finally be able to ditch the unions?

wikipedia said:In enacting chapter 11 of the Bankruptcy code, Congress concluded that it is sometimes the case that the value of a business is greater if sold or reorganized as a going concern than the value of the sum of its parts if the business's assets were to be sold off individually. It follows that it may be more economically efficient to allow a troubled company to continue running, cancel some of its debts, and give ownership of the newly reorganized company to the creditors whose debts were canceled. Alternatively, the business can be sold as a going concern with the net proceeds of the sale distributed to creditors ratably in accordance with statutory priorities. In this way, jobs may be saved, the engine of profitability which is the business is maintained rather than being dismantled, and, as a proponent of a chapter 11 plan is required to demonstrate as a precursor to plan confirmation, the business's creditors end up with more money than they would in a chapter 7 liquidation.
Monkeywrench
Monkeywrench New Reader
11/14/08 10:20 p.m.

I think they are worried that if they file for chpt 11 that no one will buy their product due to fear of losing warranty/parts support.

neon4891
neon4891 Dork
11/14/08 10:27 p.m.

wake me when these guys have some fire sales, wonder what an HHR would go for with no warranty?

MitchellC
MitchellC Reader
11/14/08 11:05 p.m.

It makes me wonder how successful they would be if without a warranty, current new models were marked down to 2/3 of sticker for a 36-term low-interest finance, or 1/2 of sticker if paid in cash. If maintained, most cars don't really have any issues within the warranty period anyway.

TJ
TJ Reader
11/15/08 5:59 a.m.

1/2 price Z06 anyone?

Consolidating lines and cutting models won't do it, but I think it would help. Their costs (labor, pensions, healthcare) are just too high to be competitive.

I feel badly for the pensioners who are living on the money that is making the companies go bankrupt - they are just getting what they were promised in return for their years of work. On the other habd it was not I who made the promise to them so why should I have to be the one to keep the promise?

pete240z
pete240z HalfDork
11/15/08 6:35 a.m.
TJ wrote: I feel badly for the pensioners who are living on the money that is making the companies go bankrupt - they are just getting what they were promised in return for their years of work.

My father-in-law retired with 30 years of service with GM. He has been retired for 22 years now and is in excellent health.

I figure his retirement has paid him about $440,000 and you can add the $350,000 that was paid for all the health problems my m-i-l has had. Total? $790,000.

I bet it will end up costing close to $1,000,000 for this one guy to be on the retirement rolls at GM. And how many other guys are also getting paid like this?

Strizzo
Strizzo Dork
11/15/08 7:21 a.m.
neon4891 wrote: wake me when these guys have some fire sales, wonder what an HHR would go for with no warranty?

you don't want one. they are terrible, terrible cars

AngryCorvair
AngryCorvair GRM+ Memberand Dork
11/15/08 1:47 p.m.

to mitchell: any new vehicle at 1/2-price is a money-loser for the manufacturer. why would they do this?

to vanilla: ford is under $2 per share, yet the kerkorians of the world are not buying it up. in fact, kerkorian bought a bunch at around $8, and dumped it at about $2.50. i don't think anybody's gonna buy ford or GM whole.

z31maniac
z31maniac HalfDork
11/16/08 9:40 a.m.
Apexcarver wrote: couldnt they reorganize under chpt11? settle debts and finally be able to ditch the unions?
wikipedia said:In enacting chapter 11 of the Bankruptcy code, Congress concluded that it is sometimes the case that the value of a business is greater if sold or reorganized as a going concern than the value of the sum of its parts if the business's assets were to be sold off individually. It follows that it may be more economically efficient to allow a troubled company to continue running, cancel some of its debts, and give ownership of the newly reorganized company to the creditors whose debts were canceled. Alternatively, the business can be sold as a going concern with the net proceeds of the sale distributed to creditors ratably in accordance with statutory priorities. In this way, jobs may be saved, the engine of profitability which is the business is maintained rather than being dismantled, and, as a proponent of a chapter 11 plan is required to demonstrate as a precursor to plan confirmation, the business's creditors end up with more money than they would in a chapter 7 liquidation.

The problem is lack of DIP financing or else that would be a viable option.

I say let them fail. If the gov't bails them out it they will just go back to their old ways.

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