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O.G.
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General Motors Corp. warned its 2005 earnings will be as much as 80 percent below its prior forecast due to slumping North American auto sales, sending its shares down 12 percent to a 13-year low.

"GM North America is, simply put, our 800-pound gorilla, and today's announcement shows how important it is that we get this business right," Chairman and Chief Executive Rick Wagoner told analysts and reporters on a conference call.

GM, the world's largest carmaker that has been steadily losing ground in its key North American market, also said it expects to post a first-quarter loss, compared with its prior forecast to break even or post a profit in the quarter.
:eek:
 

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King of Rear Clunks
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12,903 Posts
You're not gonna make much money slapping $5000 rebates on every car you sell.
 

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Other than a Corvette, I can't think of any other product I'd consider buying from them.
 

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The plant that makes the CTS is suposedly the third highest in the world for quality ratings. Piss poor workmanship? I would suggest the CTS-V as a product to consider (I did, after all), but it is pretty much a corvette with a four door suit on.
 

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Living on the redline
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Bimmer ese said:
:stupid:

Too bad the Corvette also suffers from pi$$ poor quality workmanship as well.
Do you always talk out of your :bareass:?

If theirs is pp then BMW's must be floating in the crapper :dunno:
 

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Here since day one
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It always amazed me that we Americans, who have such a love for cars and appreciation for quaility cars have our largest automobile maker, GM still not making great cars.

I definitely think they are taking a step in the right direction with the new Caddy's, the Corvette, the GTO, the new cobalt and the Pontiac G6 (which I happen to think is a great looking car)

Let's hope they keep coming out with new products like those and hope people buy them.

I'd hate to see one of our companies go down like this ...
 

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Ex-Dictator
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26,111 Posts
What I never understood is why the American car manufacturers are not capable of producing high quality interior materials.

Is it so difficult to reverse-engineer the materials used by the European premium manufacturers or even go and find the same suppliers ? I never got this all cheap plastic dashes, really, never.

At the beginning of this week I finally had the chance to see the Corvette C6 in person. It is a stunning car. Although the interior is far better than the previous generations, it's still not up Audi/BMW/Mercedes standards.

Sorry, I don't have an explanation for it.
 

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The problem runs deep. GM (and Ford and Chrysler) cannot be cost-efficient-their corporate economics do not allow it. They have a huge pension liability that must be baked into each car- didn't I read somewhere they have more RETIRED workers on the "payroll" than they have active workers? They have huge medical plan obligations to both their active and retired workers, that again must be costed into every car- one stock analyst described GM as a "HMO with wheels." The assinine contracts the domestic auto makers have agreed to with the UAW provide for "sub pay"- if a worker is laid off- they get 85% of their former salary for something like 13 months- the auto maker's labor costs are therefore FIXED- shutting a plant down costs them more than leaving it open because without production, even production that is sold at a loss with rebates, they get no revenue at all, yet must pay the same expenses. Their "marketing" is solely focused on "the deal"- zero percent financing, big rebates, give-away leases. They have reduced their "product" (as lousy as most of it is) to a commodity. As for product design, give me a break! Corvettes and tarted-up Caddy's maybe impress the "white belt, white shoes, pinky-ring crowd" but look at stuff like a Pontiac G6 or the Chevy Cobalt- compare them to Honda/Toyota/Nissan and what do you see...GM is always 1 1/2 product cycles behind- "mediocre is us!"
 

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le Boss
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2,925 Posts
RichardM///3 said:
The problem runs deep. GM (and Ford and Chrysler) cannot be cost-efficient-their corporate economics do not allow it. They have a huge pension liability that must be baked into each car- didn't I read somewhere they have more RETIRED workers on the "payroll" than they have active workers? They have huge medical plan obligations to both their active and retired workers, that again must be costed into every car- one stock analyst described GM as a "HMO with wheels." The assinine contracts the domestic auto makers have agreed to with the UAW provide for "sub pay"- if a worker is laid off- they get 85% of their former salary for something like 13 months- the auto maker's labor costs are therefore FIXED- shutting a plant down costs them more than leaving it open because without production, even production that is sold at a loss with rebates, they get no revenue at all, yet must pay the same expenses. Their "marketing" is solely focused on "the deal"- zero percent financing, big rebates, give-away leases. They have reduced their "product" (as lousy as most of it is) to a commodity. As for product design, give me a break! Corvettes and tarted-up Caddy's maybe impress the "white belt, white shoes, pinky-ring crowd" but look at stuff like a Pontiac G6 or the Chevy Cobalt- compare them to Honda/Toyota/Nissan and what do you see...GM is always 1 1/2 product cycles behind- "mediocre is us!"
Spot on. The UAW contracts in place have the big 3 bent over a barrel with no lube in sight. A recent industry magazine talked about this problem and stated that the big 3 have 2 retired workers for every active worker and that they have a large number of retired workers that have been retired longer than they worked. They've got guys that worked for 20-25 years that retired in the late 50's and early 60's still drawing pensions and medical. :yikes:

It's a mess and it's going to be painful to cleanup.
 

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Great Driver Onizuka
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3,572 Posts
RichardM///3 said:
The problem runs deep. GM (and Ford and Chrysler) cannot be cost-efficient-their corporate economics do not allow it. They have a huge pension liability that must be baked into each car- didn't I read somewhere they have more RETIRED workers on the "payroll" than they have active workers? They have huge medical plan obligations to both their active and retired workers, that again must be costed into every car- one stock analyst described GM as a "HMO with wheels."
All those costs are all into any European cars : European workers also get retirement, health care and job-loss insurance and it's all paid by the employer (thru contributions to the governement, which in turn manage the programs). It's accounted differently, but the cost is there nonetheless.
 

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Alex Baumann said:
What I never understood is why the American car manufacturers are not capable of producing high quality interior materials.
They are too big and management is too short term oriented. If you don't have the freedom to do the job the right way, you get a crappy product.
 

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Registered
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Alex Baumann said:
What I never understood is why the American car manufacturers are not capable of producing high quality interior materials.

Is it so difficult to reverse-engineer the materials used by the European premium manufacturers or even go and find the same suppliers ? I never got this all cheap plastic dashes, really, never.

At the beginning of this week I finally had the chance to see the Corvette C6 in person. It is a stunning car. Although the interior is far better than the previous generations, it's still not up Audi/BMW/Mercedes standards.

Sorry, I don't have an explanation for it.
Agree-- I don't understand why its so difficult for them to learn how to use higher quality interior materials.

Then again, I also don't understand why its so hard for European manufacturers to just use Japaenese suppliers for electrical and electronic components that always seem to be sub-par.
 

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Agreed, on just about all points. Their last profit center was their trucks and SUVs. Rising gas prices will hurt them badly. And as interest rates creep back up they won't be able to offer 0% APR financing anymore. There's also a lot of bad paper in GMAC's current loan portfolio. I would predict a huge government bailout in 5 years, tops.
 

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Sikkens Autocryl MM
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2,808 Posts
robg said:
Agree-- I don't understand why its so difficult for them to learn how to use higher quality interior materials.
Economies-of-scale. GM sold nearly 9 million cars worldwide in 2004. Let's say they spend an extra $100 in materials in only half of those cars. That's $450 million a year that could go towards profit.

And that's just one example. Engine and transmission parts, an additional screw here and there... they all add up.
 

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I do'nt make mistakes.
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10,478 Posts
elbert said:
Economies-of-scale. GM sold nearly 9 million cars worldwide in 2004. Let's say they spend an extra $100 in materials in only half of those cars. That's $450 million a year that could go towards profit.

And that's just one example. Engine and transmission parts, an additional screw here and there... they all add up.
Just think, you spend an extra $100, and if the quality is there, are able to make an extra $200 per car through lesser rebates. Many a good company has been ruined by bean counters.
 
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