GM USA: Toyota = increasing problem, since Tundra now moving into formerly secure big truck arena. GM abroad: Like Toyota in Japan, and Hyundai in S Korea, a new competitor will emerge from low-cost China-- think cheaper than Hyundai exports selling into a cash-strapped US economy. Similar to Japanese car cos in the 1970s. Cheap and small good, big and gassy not good. GMAC: a financial company, built on top of consumer credit, for cars. debt: http://www.businessweek.com/ap/financialnews/D93BUHIO0.htm If GM debt owners are scared, equity owners should be REALLY scared. Politics: Yes, maybe they get some cheap loans from the gov't, and this might be good for balance sheet, but this is the opposite of what the company needs competitively. What GM needs is for Chrysler or Ford to go bankrupt and eliminate some competition. If the gov't is going to appear fair to all those workers, they can't very well lend money to one but not the other two. conclusion: doesn't seem like GM is going to be part of the "big two" anytime soon. By accepting financing instead of trying to outgut the competition for solvency, they run the risk of yet another gov't owned entity. Not really sure why the gov't would want to take over GM, but wouldn't put it past them if GM threatens insolvency. Volt: How many miles can this thing go on a charge? Tesla, Think! anyone? Compact car is still the cheapest way to finance wheels in the US, due to hybrid's costing extra cash due to expensive batteries. Toyota Yaris. GM should probably survive somehow, but everything they do seems like a shot in their own foot.
$10.7 (09/23/08)
