The internet was ablaze Tuesday evening with stories presenting a perceived positive move by General Motors' outgoing government-appointed management. All hail! "General Motors to pay first dividend since 2008," trumpeted the headlines. GM shares immediately spiked up in after-hours trading with shares rising about $1.60 or 4% on the news. Unfortunately for those duped by the proclamation, GM followed the story hours later with a profit warning. For the time being, the bad news outweighed the good with GM shares reversing course and ending the day Wednesday with a loss of over one and a half percent on a day that the market rallied.
General Motors seems to be really good at winning awards for its vehicles. The Chevy Silverado just took home the North American Truck of the Year Award at the Detroit Auto Show. The truck also was just embarrassingly recalled due to a potential fire hazard. Unfortunately for GM, the bad news outweighs the good as awards do not always result in increased sales. Just look at the award-winning Chevy Volt as an example.
The final tallies for 2013 sales are in for the Chevy Volt and its little sister, the Chevy Spark EV. The results are ugly.
While the Volt relies on both a gas engine and electric power, the Spark is actually an electric-only vehicle, assumedly designed to compete with the all-electric Nissan Leaf which had sales of 22,610 for the year. The Spark EV did not compete well, with sales for 2013 coming in at only 589 for the seven months in which it was offered. Chevy Volt sales for the year also disappointed, coming in at 23,094 and down from 2012 sales. The Volt's sales drop came during a year when overall US car sales rose about 8%.
A recent study by fleetcarma.com unveils yet another drawback of General Motors' much-hyped Chevy Volt. It appears that the environmentally-conscientious, affluent owners of the vehicles who drive in cold weather will get about half of the electric range, on average, of those who drive in warmer climates.
Yesterday, I confronted outgoing General Motors CEO Dan Akerson, the speaker at a National Press Club luncheon. At a press conference beforehand, and through the first question at the conclusion of his remarks, I requested that GM repay taxpayers the $10 billion in direct GM bailout costs.
Akerson's refusal dominated much of the media coverage of the event. This was clearly not the story line that Akerson intended. In short, we happily stepped all over his message that the bailout is a success and that GM is back.
I made these remarks today at the National Press Club in Washington, DC before the luncheon speech of outgoing General Motors CEO Dan Akerson:
President Obama justified the auto bailout by predicting it would make money for the taxpayer. With Treasury now selling its remaining shares, the direct loss is about $10 billion. So on its most fundamental level, the auto bailout is a failure.
But that $10 billion figure dramatically understates the true cost. There were separate multibillion dollar bailouts of Ally Financial, formerly know as GMAC, and Delphi and other suppliers. There was cash for clunkers, the government guarantee of warrantees, accelerated fleet purchases, etc., etc.
Submitted by NLPC Staff on Mon, 12/16/2013 - 11:30
Peter Flaherty, president of the National Legal and Policy Center (NLPC), today posed key questions to the General Motors leadership at a National Press Club press conference, including whether the company will repay to taxpayers the $10 billion direct cost of the GM bailout.
News that the U.S. Treasury Department has sold its remaining stake and that Mary Barra will take over as GM's new CEO have put the spotlight on the company and its future. GM executives have pointed to GM's $26.8 billion in cash as evidence of its improved financial position. Analysts have raised the possibility that the company will buy back shares or institute a dividend.
I will hold a press conference on Monday, December 16 at 11:00am to pose key questions to General Motors leadership, including whether and when the company will repay to taxpayers the $10 billion direct cost of the auto bailout.
News that the U.S. Treasury Department has sold its remaining financial stake and that Mary Barra will take over as GM's new CEO have put the spotlight on the company and its future. GM executives have pointed to the company's gigantic cash position as evidence of its improved finances. Analysts have raised the possibility that the company will buy back shares or institute a dividend.