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Discussion Starter #1
With GM announcing its going to cut 25,000 jobs they've publicly shown that they have yet to clue into what their problem is. Its nots the people and the health care thats their problem, even if this does put a band aid on it for now, their real problem is their cars.

GM has some of the most lack luster car designs I've ever seen. I understand that companies such as GM need to appeal to a large market and are therefore scared to go too crazy with the designs to avoid turning customers off, but they still have to be interesting and eye catching. And its there that other manufacturers have succeeded and GM has failed, miserably.

GM continually rehashes the same cars over and over with no real innvoation. Except for Cadilllac Brand who with the Esclade and other cars such as the CTS V have turned the company around and made it a much more marketable company to younger demographics. Why GM doesn't apply some of the same principles to their other Brands is beyond me.

Nobody wants a boring car and until GM and it branches realize this they'll never be able to compete with the Toyota and Nissans of the modern automotive world.

Patrick
 

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I don't want to be deliberately contrary here, but Toyota don't really make exciting cars. They make cars of very high quality and cars with very high reliability ratings, but other than that they're basically whitegoods on wheels.

To disagree further, employee costs really are a huge burden. They spend more on healthcare per car than they do on steel. It's a bit of a self-propelled blackhole they're stuck in as lack of design investment has meant lack of sales which has meant lack of cashflow and in turn, lack of investment. (by the way, was that selfpropelled black hole thing enough of a mixed metaphor or what!?)

Nobody would disagree that the cars do need to get fresher and better, but you can't ignore the other costs they're lumped with completely.
 

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Swade said:
I don't want to be deliberately contrary here, but Toyota don't really make exciting cars. They make cars of very high quality and cars with very high reliability ratings, but other than that they're basically whitegoods on wheels.
What about MR2, Altezza/I300, and last but not least Supra? :cool:
 

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Supra - OK. Altezza and MR2 - yawn.

What about Corolla, Camry, Avalon?

Like I said, whitegoods on wheels.
 

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Discussion Starter #5
The Camry and Avalon may not be the most exciting things to ever hit the street but they much nicer to look at then say a buick lacross.

I must say the solstice is definitly a step in the right direction.

To disagree further, employee costs really are a huge burden. They spend more on healthcare per car than they do on steel. It's a bit of a self-propelled blackhole they're stuck in as lack of design investment has meant lack of sales which has meant lack of cashflow and in turn, lack of investment. (by the way, was that selfpropelled black hole thing enough of a mixed metaphor or what!?)
I understand Health care fees can be large and heavily affect a companies budget. But cutting jobs to save on employee cost isn't going to turn the company around.
 

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another huge part of the problem is "which car do i buy?" 5 domestic brands all coming from one company. the cars are too similar. very little product differentiation. that and the wide range of products was largely bland. lose buick and olds divisions, keep caddy and chevy. basic economic theory.
 

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patrick_01 said:
I understand Health care fees can be large and heavily affect a companies budget. But cutting jobs to save on employee cost isn't going to turn the company around.
No ... cutting jobs won't magically make the cars start selling better, but GM is in a situation where they need to stop the bleeding before they can fix any "real", core problems. They can't continue to lose money to employee costs AND invest in new product design, etc. Yes, I think we all agree that there are other significant issues at GM; but, as a corporation, they need to find a way to stop losing money as soon as possible to be able to even attempt to turn things around. It may seem harsh to cut jobs, but it is the nature of business. Whenever a company is looking to produce savings in operating expenses, the quickest/easiest way is always headcount reduction .... especially for an entity like GM that spends so much on health care for their employees.

I'm sure you've all heard the adage "It takes money to make money." ... well GM is just trying to free up the money they need to invest to make money ... then, once the bleeding is under control, we can only hope they will seriously address the root problems.
 

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Many of their "hot" models are RWD (Monaro, Commodore etc) and I wouldn't want to see Saab go RWD. AWD for Saab is ok though. Actually I kind of like the Adventra 4WD line ...... has some hints of the 9-3X concept and would make a good starting point for Saab to build a 9-3X Crossover :)


http://www.holden.com.au/www-holden/action/vehicleselector
 

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93linear, we can't be sure. but it's theoretically possible that cutting jobs will fix the problem because if gm is selling X number of cars and cutting 25,000 jobs will make the X quantity profitable, then gm might be on the way to it's equilibrium employment quantity. like i said before, they're product line is too undifferentiated and broad to support sustained sales. gm has a host of problems. time for a new business model.
 

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no you are wrong. dead wrong.

cutting jobs is exactly what GM needs to do. its no longer GM running GM, its the UAW running GM. the average pay on the line for GM i believe is $35 an hour. for a job that requires no skills, no degrees, and absolutely no brains.

basically what this is going to do is slap the UAW in the face. now people might, MIGHT be scared of losing their job instead of the UAW just getting their jobs right back, they actually might have to work. also, healthcare, at 1500 a car is hurtfull. you cant say it isnt. Toyota has no unions. Chrysler got rid of most of theirs when they declared bankruptcy way back (mid 80's?) and the other thing, is that from industry insiders, GM vs. Chrysler on the road to bankruptcy is that Chrysler didnt care what they did, they just declared it. GM is trying to fix it. GM doesnt want to **** everyone over like Chrysler did. you have to think of the other companies GM deals with (glass manuf., plastic, electrical, rubber, etc) they all are owed money, but the second GM declares bankruptcy they are owed no money. it all just vanishes. that hurts the bottom line like no ****ing other.

/rant
 

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nourdmrolnmt1 said:
no you are wrong. dead wrong.

cutting jobs is exactly what GM needs to do. its no longer GM running GM, its the UAW running GM. the average pay on the line for GM i believe is $35 an hour. for a job that requires no skills, no degrees, and absolutely no brains.

basically what this is going to do is slap the UAW in the face. now people might, MIGHT be scared of losing their job instead of the UAW just getting their jobs right back, they actually might have to work. also, healthcare, at 1500 a car is hurtfull. you cant say it isnt. Toyota has no unions. Chrysler got rid of most of theirs when they declared bankruptcy way back (mid 80's?) and the other thing, is that from industry insiders, GM vs. Chrysler on the road to bankruptcy is that Chrysler didnt care what they did, they just declared it. GM is trying to fix it. GM doesnt want to **** everyone over like Chrysler did. you have to think of the other companies GM deals with (glass manuf., plastic, electrical, rubber, etc) they all are owed money, but the second GM declares bankruptcy they are owed no money. it all just vanishes. that hurts the bottom line like no ****ing other.

/rant
I don't think Chrysler declared bankruptcy in the 1980's. I think the last time Chrysler was under bankruptcy protection was in the 1920's. Chrysler came close to filing for bankruptcy, but was saved at the last minute by federal government loan guarantees in the 1980's.

When you say Chrysler "got rid of most of theirs," to what are you referring? Health care legacy costs? Union workers? Your antecedent is ambiguous. If you mean union workers, I think that is incorrect. All Chrysler US and Canadian plants are unionized.

As for bankrutpcy, you are incorrect in asserting that all debts are wiped away in bankruptcy. Especially in a large commercial enterprise situation, many debts are renegotiated with creditors and then ratified by the debtor. Also, the treatment of debt would depend upon whether a company filed under Chapter 7 or Chapter 11. Chapter 7 is a liquidation situation where a company intends to wind up its business, sell all of its assets and pay out what it can to its creditors. If GM were to file for bankrutpcy protection, it would, no doubt, file under Chapter 11, which is intended to give breathing room to a corporation to restructure and negotiate its debts with its creditors. Debts aren't necessarily "wiped away" in a Chapter 11 proceeding. The biggest advantage from GM's perspective for bankruptcy would be to deal with legacy health care and pension obligations.
 

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Hmmmm...

I don't think it is that they don't have a clue about what needs to be done so much as they just don't know how to formulate a plan on how to GET there.

Of course, that doesn't make a difference in the end, does it. Too bad because they really don't make awful cars, they are pretty solid and reliable these days.
 

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Apparently after all of this, GM has decided on a myriad of things.

1. GMC, Pontiac, and Buick will now be sold together and will not compete with each other, meaning no Buick trucks, no Pontiac midsized sedans. Buick will have 4 cars, Pontiac will have 5, GMC doesn't lose anything. They will all be sold at the same dealership. This is to reduce competition between brands, to give each brand an identity (Pontiac will only sell "sporty" cars now, Buick only sedans), and to reduce advertising costs.
2. GM will fire 25,000 people, but not instantly. It will be people towards the ends of their careers, or very early. Many of them will likely be buyouts of people near retirement. Every little bit helps.
3. GM has decided on changing how they sell cars. After this promotion, there likely will be no more rebates, at least not to the level we have seen before. GM feels that rebates do not show up on intellichoice or other internet sites, so they are competing with cars that actually cost more. Thus, they will lower the MSRP to make costs nearly the same, but no more rebates. Plus, your average car buyer (like your average person, but none of you certainly) is pretty stupid. GM would be happy to make car buying similar to the Saturn model, and June is looking pretty good for them so far.
4. They are outsourcing supplies to nonunion countries. You decrease the stuff it takes to build the car, cars will cost less. You decrease the number of people you have to pay to build the cars, they will cost less.
5. They are trying to design something that will get people into the dealerships similar to the 300C. A well designed GTO (read "prettier"), or a cheaper model of the CTS would do wonders for the company.
 

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This news just came in:

http://www.cnn.com/2005/AUTOS/06/13/gm_prices.reut/index.html

Some price cuts may be permanent



qcomdrj said:
3. GM has decided on changing how they sell cars. After this promotion, there likely will be no more rebates, at least not to the level we have seen before. GM feels that rebates do not show up on intellichoice or other internet sites, so they are competing with cars that actually cost more. Thus, they will lower the MSRP to make costs nearly the same, but no more rebates. Plus, your average car buyer (like your average person, but none of you certainly) is pretty stupid. GM would be happy to make car buying similar to the Saturn model, and June is looking pretty good for them so far.
 

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USA: what are your reactions to this article?

http://money.cnn.com/2005/06/08/Autos/toyota_us.reut/index.htm

I personally see this as a slap in the face for the US industry. A nice move from Toyota, as it might help bolster "Big Three" sales, however my so called American arrogance will show: I think that this is a pity move that will lessen the image of US industry, and now that people (even in the US) seem to show some sort of disdain for my country, this move by Toyota will help promote the argument that the US is just crap - for lack of a better word. Granted I proably am taking this way too personally (and my brain might be a little fried because of the lack of A/C in my 85 degree office) but I really feel paranoid when I read something of this nature. I feel as though the future of US industry is in jepordy, and I can even see the day when Toyota (or another comparable Asian company) puts an offer to buy one of the US auto companies. Again, this is my reaction, my paranoia, so anyone else who has an opinion please share it.

PS: i'm not a big fan of many US cars, but I am more concerned about the jobs at stake here.
 

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SaabKen said:
This news just came in:

http://www.cnn.com/2005/AUTOS/06/13/gm_prices.reut/index.html

Some price cuts may be permanent
Yeah, I didn't cite it, but I had other knowledge of the plans. Wasn't sure how many people would actually believe me though.

Thanks for the followup.

As for Toyota, they are worried about American backlash, but then they go make a patronizing statement about American carmakers.
I see it as a way for them to make more per car sold, personally. They could sell the Prius for $50K and some people would buy it.
 
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