Posted on 02/12/2008 4:46:14 AM PST by John W
General Motors Corp. reported one of the largest losses ever for an automotive company Tuesday as it struggled to turn around its North American business amid a weak economy. Also this morning, the company offered a new round of buyouts to 74,000 U.S. hourly workers. GM said it lost $38.7 billion in 2007. The loss largely was due to a third-quarter charge related to unused tax credits.
The Detroit-based automaker also on Tuesday said it was offering a new round of buyouts to all 74,000 of its U.S. hourly workers who are represented by the United Auto Workers.
The 2007 loss topped GM's previous record in 1992, when the company lost $23.4 billion because of a change in health care accounting, according to Standard & Poor's Compustat.
Excluding the tax charge and other special items, GM lost $23 million, or 4 cents per share, for the year, compared with a net income of $2.2 billion in 2006, beating Wall Street's expectations. Analysts polled by Thomson Financial expected GM to post a full-year loss of 95 cents per share.
GM posted a loss of $722 million, or $1.28 per share, in the fourth quarter, compared with a net income of $950 million in the year-ago quarter. Fourth-quarter charges included $622 million to Delphi Corp., GM's former parts division, for its restructuring efforts.
GM reported $181 billion in revenues for the year, down from $206 billion in 2006. But the automaker said its automotive business saw record revenues of $178 billion in 2007, up $7 billion from a year ago thanks to growth in emerging markets and favorable exchange rates.
But GM's North American division continued to struggle, posting a $1.5 billion loss for the year.
GM's results also were dragged down by its 49 percent stake in GMAC Financial Services, which lost $2.3 billion in 2007. GM reported a $1.1 billion loss attributed to GMAC.
GM barely retained its title as the world's largest automaker in 2007, selling just 3,000 more vehicles than Toyota Motor Corp. GM sold a total of 9,369,524 vehicles worldwide, up 3 percent from the year before.
I guess Ditech and subprime car loans weren’t such a great cash cow after all.
All 74,000 union workers are included.
I was wondering if GMAC Mortgage played a part in this.
Make crappy, overpriced vehicles, and you get crappy finacial reports.
A couple billion here, a couple billion there - pretty soon your talking real money.
The weak dollar will probably not help GM as it will have to pay more for all the outsourced material.
Word on the street here in Detroit is that this is a good sign for GM. Most of the loss was an accounting loss from tax breaks, and the revenues are up.
Wall Street has the stock futures going up, so it’s not the doom and gloom the headline would suggest.
Why spend the extra $12K when I know that's coming up?
They just announced new incentives on trucks and SUVs, so I’m waiting for my dealer to call with the numbers so I can continue my quest to destroy the environment and buy my new SUV.
Far too many factors to be able to fully address them in a post. But I will throw a few into the hat:
GM quality has not meant much in the last several years. After a short upswing, observed quality has fallen in the last 7 year or so, with no apparent effort to rectify the situation.
Design - some really ugly designs have come through GM in the last several years. Remember - the first thing that attracts customers is looks, then followed by quality (and a growing number looking for fuel efficiency).
Some not-so-good business decisions as a whole - investing in some real losers (like Daewoo a few years back). Then the investments in credit companies...ugh.
Feel free to add...
By the way - are Honda and Toyota bleeding cash and laying off/buying out tens of thousands of employees???
I dunno - I know some folks who bought basically identical vehicles - one under the “employee pricing, the other just before - and the one that bought the one before actually paid a bit less.
In reality, a salesman that we have done business with a couple of times was telling us that the “employee pricing” was a gimmick - the prices were in the ballpark of what the prices were with the incentives (rebates) before.
“Excluding the tax charge and other special items, GM lost $23 million, or 4 cents per share, for the year, compared with a net income of $2.2 billion in 2006, beating Wall Street’s expectations. Analysts polled by Thomson Financial expected GM to post a full-year loss of 95 cents per share.”
Looks like their performance exceeded expectations, by a lot.
It’s been some time now since GM made a crappy vehicle.
Yeah, I'd say that this is pretty crappy engineering and quality control.
You didn’t read the article. The losses came from the credit card division...GMAC financing. GM is still the number one automaker in the world.
Apparently you haven’t driven a gm car lately. My tahoe is great and try the g6.
True!
I love my 05’ Silverado 2500HD and 07’ Tahoe LTX!
Ditech sucks money from the auto financing and GMAC is an A paper only car loan venue....................18% only are across the board A paper...........a losing percentage..
‘01 GMC Sierra 4WD extended cab. 1 recall for tailgate cables. Otherwise, perfect.
all Chevys .except the Vette and all Buicks are gonna be offered at world classs pricing this summer and early fall...The quality is the reason.....GM will set sales records AND QUALITY not seen since the mid 60’s.
......I do work for GM and have for 21 years
Had the same recall on my ‘99. By far the best vehicle I ever owned, 153K miles and I belive just getting broke in. Bought the bride an ‘07 Envoy last summer. Though I don’t drive it, I expect to be just as pleased with this model. We tested the competition and nothing compared to the GMC.
“GM barely retained its title as the world’s largest automaker in 2007, selling just 3,000 more vehicles than Toyota Motor Corp. GM sold a total of 9,369,524 vehicles worldwide, up 3 percent from the year before.”
I’ve been a vocal critic of the quality of American vehicle until just recently. At least when it comes to GM. The last year or two, they’ve really improved the qulaity of their vehicles accross the board. The Tahoe/Yukon is a quality vehicle and would be selling a heck of alot more if it were not for the high gas prices altough they still sell alot of them in Texas. Ditto for the new Silverado truck. I drive a 2007 Chevy Avalanche and love the handle of the ride. The 2008 Malibu is getting reviews that were only reserved for the Camary and Accord just a year or so ago.
Chrysler has some attractive vehilces but I’ve heard alot of mechanical problems and piss pour customer service. Ford really hasn’t built anything lately that makes me turn my head.
How far up with the stock market go on this news? /sarc
Story of my life.
"...I do work for GM and have for 21 years."
Tell your GM coworkers the C6 has been one of the most magnificent automotive driving experiences I've ever had, easily topping the C5 & that was no easy goal.
Add to the superior handling & styling the MZ6 gearing has delivered an astounding 30MPG, highway. As long as performance *demands* aren't made of the LS2 --and one's not burning the garbage ethenol-- the LS2's surprisingly gas-stingy. I'm hoping our future LS3 is at least as good, we know it'll deliver more performance.
Hey world automakers, top that.
We've an Infiniti FX-35, love it. Great fit & finish and styling. BUT reliability has been no better than our 4 GM products, impeccable for 'em all. Unfortunately the Infiniti's twin cam 24 valve V6 is one hell of a gas guzzler, simply awful and unlike anything we've ever owned, and we've owned a lot.
Because of the Infiniti's lousy mileage we'll be considering the Buick Enclave when time comes to turnover the FX.
Buick hits a home run clean outa the park with Enclave styling we fell. Close to or even topping the FX-35 but without the price tag. Reasonably decent mileage will cinch the deal for our acquiring a new Buick.
My pal's Saturn RL's been one hellova great car, also.
Fabulous looks/styling & features in a small, efficient package. The RL delivers performance one wouldn't believe from a 4 cylinder that'd shame a Honda S2000, again minus the S2K's price.
GM builds marques delivering satisfaction, performance & reliability far exceeding anything built today by 98% of the other car manufacturer on the planet, hands-down.
Nice job.
...keep it up. ;^)
our humble pleasure and my compliments on your details
The Z06 is a titanium shell with carbon fiber outside. The computer to brake and motor interaction in unparralled in the auto industry. And this world class auto is MSRP’d at 76 to 79k.........240k less that what is not even close. The Z06 does not suffer the mandated gas guzzler tax as well....let that sink in.
....the coming 4.5 litre diesel built in conjunction with Allison transmission will be fitted in the Tahoe, Suburban, a rear wheel drive Impala.
...The current model of the Malibu is equally unparralled as well and industry leading in cost,warranty and awards.
....we haven’t even mentioned the coming Camaro either...
The $1.2 billion charge for GMAC doesn't figure into the $4.4 billion operating loss for 2007. As it stands right now, GM loses money making automobiles, with profitable overseas operations partially offsetting larger North American losses.
GM is still the number one automaker in the world.
There is some debate over this point, involving sales accounting for minority ownership for Chinese subsidiaries, but if GM can't make a profit, it's something of a moot point.
What kinda crap is that?
:^)
"The Z06 is a titanium shell with carbon fiber outside. The computer to brake and motor interaction in unparralled in the auto industry."
Amen, and it's so much more and that doesn't even take into account the anticipated ZR-1.
*If* the Z06 were available in anything other than a FRC, I'd snatch one up as fast as it moves. Trust me.
"And this world class auto is MSRP’d at 76 to 79k...240k less that what is not even close."
HA!!
Just in case you GM guys missed it?
Feast your eyes on THIS.
{~pay special attention to the kibitzing going on inside the F-Car, the POV this film was shot [from]. ;^) }
"The Z06 does not suffer the mandated gas guzzler tax as well...let that sink in."
Oh it sunk, alright. :o)
Be that as it may when I saw what GM, Ford & Chrysler began offering --nevermind what they *planned*-- ie several vehicles in excess of 500HP AND well within CAFE Standards on fuel economy?
I knew the nanny staters would NEVER stand for it, if for no other reason than their not tolerating the sight of a few fortunate Americans enjoying themselves. And they haven't; hence, the *new* CAFE.
New standards which may very well be the straw that broke the camel's back; insofar, as the great American cars are concerned. American products will be on an eye-to-eye level with the Asian (mainly) imports, that is to say awful --if not totally nonexistent styling and performance so banal one may very well fall asleep approaching their car.
"...the coming 4.5 litre diesel built in conjunction with Allison transmission will be fitted in the Tahoe, Suburban, a rear wheel drive Impala."
What's the skinny on this 4.6L??
What makes it so special?
"...The current model of the Malibu is equally unparralled as well and industry leading in cost,warranty and awards."
Bought my bride a work car for commuting from our place in the country into the city, a Cobalt SS w/ all options. She loves the thing and while performance isn't in the same league as the LSx series, it is peppy and MPG are on a par with my pal's RL. Plus it has all the safety stuff one could ask these days of a new automobile.
"...we haven’t even mentioned the coming Camaro either..."
Be interesting seeing one of these things up-close & personal. Find out what Chevrolet has in mind for the new iteration of the Z28?
Z28s were the cars I'd been buying the bride for her business/grocery-getter rides for years, last one being a SS.
Loved 'em *all*, without exception which is why we continued buying.
Listen advertising guy, OT, do me a favor.
DUMP Mellencamp for Chevrolet's truck campaign, will ya?
Every single time it comes on --without exception-- we race for the remote to mute him, we just cringe.
Is *that* really the reaction GM/Chevrolet is looking for?
I'm inclined to doubt it, myself. ;^)
At least consider what I've said because there're all to many who know what the leftist flake really represents, and it ain't America; nevermind, GM's product(s). Having Mellencamp front for Chevrolet is as absurd as Harley-Davidson choosing the other little slob to play their birthday bash.
Just *nutz*.
Now having ZZ Top play the birthday bash in Nashville for the 50th anniversary in '03, that was a good move.
...save for [the] Southern Baptists in attendance? :o)
It's due to lousy gas with too much sulfur content screwing up the transducer, Shell was the worst offender.
"And it will cost a few hundred bucks to get it fixed."
You're lucky that's all it'll cost, the tank has to come out to access the level sensor and in some models you wouldn't believe what [that] involves.
"And the plastic the door panels are falling apart, too. What kinda crap is that?"
People demand the best possible MPG, AND, power/torque; especially, the owners of P/U trucks.
That means a vehicle has to be as light as possible with, generally, a V8 powerplant.
To instantly boost a horse power to weight ratio means using lightweight materials, ie plastics, everywhere possible.
...just the way it is.
They make average quality vehicles, or slightly below average quality vehicles.
They charge more than average prices for them.
While there are some exceptions, GM vehicles just aren't a very good value for the money. There sales are as good as they are because of brand loyalty, and people who believe strongly in buying from an American car company.
Our household has two GM vehicles. Both have been extremely reliable, though one’s not old enough yet to make any bold reliability claims.
Not too long ago I took delivery on an ‘08 Saturn Sky Redline. The car outperforms similar vehicles costing $10K more and gets great mileage (beyond 30+ mpg at highway speeds). The WORST mileage I can get is around 22 mpg; this from a car that trots 0-60 mph in 5.5 seconds.
Oh, thank God it had nothing to with the cars they build.
What'd they do, forget how?
Really sad about GM. However, no business can stay in business over the long term with their insanely bloated cost structure and the way they have given the store away to the unions.
I used to teach classes at the Oklahoma City GM plant before they closed it down. That plant produced the Envoy and the Trailblazer (mid-sized SUV’s). When gas prices went over $3 a gallon you could hardly give those SUV’s away - they got around 15 MPG in town.
I can’t understand why GM isn’t producing cars getting 50, 75, and 100+ MPG. I drive a 2000 VW Jetta turbodiesel that gets 55 MPG on the highway. If GM was producing cars with this kind of fuel efficiency, I’m sure more people would be buying.
GM needs to go completely go non-union, take a long, hard look at Toyota’s success, trim expenses to the bone, get lean and mean, and dramatically raise the fuel efficiency in their vehicles.
Well, about time.
Never thought you'd ever get outa the engineering meetings, geshhh. :o)
"Our household has two GM vehicles. Both have been extremely reliable, though one’s not old enough yet to make any bold reliability claims."
Trust me, the RL's about as bullet proof as anything GM's built, ever, and as for the Escalade? If nothing major's gone south yet, it ain't likely. Got a good one, there.
In any event, I've an idea.
I'd be willing to wager a small, modest stipend the RL will not have any recalls or other major failure(s) for the first year you own it, BM.
Name the bet.
Of course TSBs aren't included, even tho' Saturn will attend to whatever TSB's might be issued, promptly and at no cost to you.
That's just how GM's been doing business, why we're such loyal customers.
"Not too long ago I took delivery on an ‘08 Saturn Sky Redline."
Yea.
And one of these days you may even get to drive the damned thing, too. {g}
The price we're all paying for Global Warming, I guess. ;^)
"The car outperforms similar vehicles costing $10K more and gets great mileage (beyond 30+ mpg at highway speeds). The WORST mileage I can get is around 22 mpg; this from a car that trots 0-60 mph in 5.5 seconds."
Uh-huh; BUT, it's the killer looks that hooked me, and K, for that matter because you've NOT let me drive it.
It's a little missile, a rocketship I *will* drive sooner rather than later, more rather than less.
Getting out-of-this-world mileage on top of all the other outstanding attributes of the car?
...just sauce for the goose. ;^)
Will the Camaro SS have the 500hp LSA? Is GM coming out with a Stage 2 performance package for the Sky Redline that includes CAI, Cat-Back, Intercooler and reflashed ECM?
Ok, what’s your point?
You said “GM is still the number one automaker in the world.” I was pointing out it is all but a dead heat.
that auto is an example of the USA just showin’ off
So what? You still havn’t made a point yet.
Technically, I think that car is more german than american. It’s a copy of an opel.
Oops, maybe that’s english...designed by lotus.
not the same....old tapes.......the new stuff is strictly GM
why specifically do you ask.seems a loaded question
I am asking about the Camaro SS because it needs to compete against the Shelby GT500 and I am asking about the Sky Redline because I just bought one. I am also asking if the G8 GXP will have the 430hp LS3. I have owned three Trans-Ams and two Mustang Cobras, so I do know something about muscle cars.
Actually, the Opel is virtually the same as the Sky Redline, with different badging. All are made in GM’s Wilmington Delaware facility. The lion’s share of the production is shipped overseas as the Opel GT.
The EcoTech 2.0L engine in this vehicle has the highest specific output per displacement of anything built in the history of GM.
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