GM expects to lose about $847 million in first quarter

[BeatleBoot]

http://www.detnews.com/2005/autosinsider/0503/16/autos-119127.htm

<snip>

DETROIT - General Motors Corp. said today it expects to report a first quarter loss of approximately $1.50 per share, or about $847 million, excluding special items due to reduced production and sales, tight pricing and changing consumer preferences to cars from higher profit trucks.

<snip>

"The competitive environment that we face in North America means we must continue to find ways to reduce our costs and grow revenue," said GM vice chairman and chief financial officer John Devine.

"While we have made good progress in reducing costs over the last several years, the projected loss in North America reinforces our need to do much more, particularly in the area of health care."

[cornermouse]

1. As gas prices rise, expect the car companies to lose their

shirts for the rest of the year unless they can develop a way to retrofit all those new cars on their lots as hybrids.

I think a lot of people are going to decide that if they have to buy a new car, they're going to think long range and buy a hybrid.

[Gloria]

10. And the GM fleet is the least fuel efficient, from what I've read...

eom

[Tandalayo_Scheisskopf]

2. They should try emulating success.

But they won't. They will continue on their merry way.

Another thing they could possibly consider is a line of cars that are affordable and that people would buy. They can make affordable and interesting autos if they so desired.

[chaumont58]

3. I think you are so right

I think GM and the US auto industry in general has been poorly run for years now. They refuse to get away from the idea that gasoline is cheap and plentiful. With China becoming a first world nation, oil supplies will become even more stretched. The idea that there is going to be huge competition for oil is not 'latest breaking news.'
I spent most of my working life in the LA area, and drove the freeways too many days. Most cars on the commute had one occupant, the driver, and weighed thousands of pounds. Japan's auto industry took market share away from Detroit because they offered more fuel efficient and more mechanically reliant cars. In the 70s, Ford stood for found on the road dead, or fix or repair daily. GM and Chrysler were no better.
The future for American car makers is bleak. They can not seem to find a way to design and build cars a sufficient number of Americans want.
Health care costs are a separate issue. For too long, American business has stood on the sidelines and let the AMA and the repukes block any effort toward a national single payer system that is not employer subsidized. The US pays an inordinate amount of GDP on health care issues and still does not manage to insure all its citizens. Disgraceful, really.

[trogdor]

11. You hit the nail on the head, there.

GM has gotten away with telling us what we want for so long, they've forgotten how to give us what we need. Fuck 'em. I'll drive my 6 year old Honda until it falls apart, and that'll be awhile.

[hughee99]

5. The company is poorly run...

But they are still driven by the almighty dollar. A few more quarters of this and they will eventually figure out that people want more affordable, more efficient cars. It's things like this that get a company to reevaluate their product line, because the shareholders will be pissed. In the meantime, it sucks for their workers, because I'm sure that this will mean more layoffs.

[maxsolomon]

4. you could be leading the planet in fuel efficiency

but no you wanted to make Escalades.

i wouldn't drive a GM piece of crap if you gave it to me for free.

[gizmo1979]

6. Why can't the CEO's

That are compensated in the millions of dollars forecast a simple trend like gas prices starting to rise and the consumer wanting better gas mileage.Did they really think more power would last forever?Isn't this supposedly why they make all the big dough?If they had started ramping up smaller cars and hybrids they would have been ready.Not to mention the amount of disposable income going down,and debt going up.I wouldn't think you'd have to be a rocket scientist.

[DeepModem Mom]

7. NYT: G.M. Sees a Loss Near $1 Billion; Stock Falls 19%

G.M. Sees a Loss Near $1 Billion; Stock Falls 19%
By DANNY HAKIM

Published: March 17, 2005


DETROIT, March 16 - General Motors' stock fell to its lowest level in more than a decade Wednesday after the company said it expected to post a loss of nearly $1 billion for the last six months. The news set off G.M.'s largest single-day share loss since the market collapse of 1987 and further darkened Wall Street assessments of the company, the world's largest automaker.

The losses reflected an increasingly harsh reality: that General Motors, which three years ago was thought to be the healthiest of the Big Three automakers in Detroit, is now considered the weakest, primarily because it is not selling enough cars at home. The losses also raised questions about the strategy of the company's chairman and chief executive, Rick Wagoner....

***

Numerous problems are weighing on G.M. in the United States, its crucial home market, where brands like Pontiac, Buick and Saturn are household names yet are sorely lacking in appeal, according to J. D. Power & Associates, the quality and customer satisfaction analyst.

A wave of new models has not helped stem the company's plummeting sales, even though G.M. spends more than any other automaker on rebates and low-rate financing deals. That has led G.M. to scale back its production in North America in the first half of the year by 300,000 cars, or about 10 percent.

Increasing health care costs are also a heavy burden for the company, which is America's largest private health care provider; G.M. covers 1.1 million Americans, or nearly 0.4 percent of the entire population. Rising interest rates and weakening credit ratings are expected to cool its lending business, the General Motors Acceptance Corporation, which is its main profit center. And foreign competitors, like Toyota and Nissan, are far more profitable....


http://www.nytimes.com/2005/03/17/business/17motors.html

[hatrack]

8. Don't worry! They'll just sell some of their hydrogen cars, and . . .

boost production of their hot-selling hybrids (for which some people are waiting a year or more, and then they . . . oh. That GM.

Never mind.

[leesa]

9. Good.

[gulliver]

12. Watch that SUV resale value plummet!!

What a shame. The bigger they are...