GM

GM Buyback of Treasury Shares – Why Now?

General Motors moved quickly to complete its buyback of 200 million shares from the US Treasury Department before year end. It is a welcome sign that the Obama Administration is finally beginning to exit taxpayers' GM stake, a move that could have been made a year and a half ago when share price was closer to $30. While some felt it was never the place of Government to gamble taxpayer money on Wall Street by market timing the exit of Treasury's GM stake, others argued that taxpayers would be better served by waiting until GM share price rose to at least over the $33 IPO price of two years ago.

Taxpayers Get Hosed in GM Buyback of Treasury Shares

Government MotorsLet's all rejoice! The Treasury Department is finally beginning to unload the taxpayers' stake in General Motors after a three and a half year stint of government involvement in the company. While the decision to get taxpayers out of the private sector is the correct one, the move is hardly a cure-all for what ails GM. And despite reports to the contrary, this does not bring closure to all groups that were involved in the unprecedented intrusion of government into the private sector that saw politically-powerful groups like the UAW receive favorable treatment over other classes.

Canada Follows US Lead on Refusal to Sell GM Stake

It would appear that there is a bit of a Mexican standoff regarding the sale of General Motors stock by the three major holders. The US government (aka taxpayers), the UAW and the Canadian government have a combined ownership stake in GM of about 50%. If any of these three were to dump their shares on the market, the remaining holders will see a drop in the value of their shares due to the dilutive effect of the new shares hitting the market. Recent stories regarding the mindset of the Canadian government reveal that they will mirror the market-timing philosophy of the US government by hanging on to their stake. The decision may be driven by closed door meetings with US Treasury Secretary, Tim Geithner.

GM Hypes Chevy Volt's Insignificant 100 Millionth Mile

Akerson and VoltGeneral Motors is making more ridiculous claims on the Chevy Volt by flooding the web with stories of how 100 million electric miles have been driven since the Volt's much-hyped inception. Let's put the boasting in perspective. In the two plus years that it took for Volt drivers to put on 100 million miles, gas-powered vehicles logged over 5 TRILLION miles in the US. It would take only 5,000 cars traveling 10,000 miles a year to log 100 million miles in two years. The Volt has fallen far short of sales goals and has cost taxpayers billions of dollars in subsidies to reach the much-publicized but unimpressive milestone. So, what's the net reduction in gas usage in the US as a result of the Volt's accomplishment? Less than .002%.

GM’s New Electric Chevy Spark - More Green Insanity

Chevy SparkAlbert Einstein is credited with having defined insanity as "doing the same thing over and over again and expecting different results." Well, prepare for more insanity as General Motors is doubling down on green energy and plug-in cars after the disappointing sales results from previous entries into the field. The politically-motivated hype that we saw, and continue to see, on the Chevy Volt will be repeated. This time the over-hyped vehicle will be a Korean-made, all-electric Chevy Spark.

Bailed-Out Ally Financial Unit Comes Full Circle Back to GM

Ally financial girlThe final pieces are coming together in the General Motors' restructuring puzzle as the company has, not surprisingly, won its bid to repurchase government-owned Ally Financial's European and Latin American lending operations. GM was forced to spin off all but 10% of Ally Financial back when it was known as GMAC.

Back in late 2008, the spigots of taxpayer money were open and GM had its cup out. In order for GM's lending arm (GMAC) to receive TARP funds, GM had to divest all but less than 10% of the company so that GMAC could be granted status as a bank holding company. Under President Bush's watch, the Federal Reserve approved the move and the company that is now known as Ally Financial eventually received about $17 billion of taxpayer money. GM itself would eventually end up with about $50 billion of taxpayer money, mostly distributed during Obama's term.

How Healthy is Auto Industry? - American Suzuki Goes Bankrupt

SuzukiNow that the election season is coming to an end, we may get a clearer picture in the near future as to just how "healthy" the auto industry really is. Another car company has just filed for bankruptcy as American Suzuki announced that it is filing for chapter 11 protection and will no longer be selling vehicles in America.

Fact Checking Romney and GM on Job Creation Claims

General Motors is criticizing Mitt Romney for running an ad that says GM cut 15,000 jobs under the Obama Administration. The Detroit Free Press reported that GM spokesman Greg Martin (speaking about the Romney ad) stated, "No amount of campaign politics at its cynical worst will diminish our record of creating jobs in the U.S. and repatriating profits back to this country."

Leaving aside for a moment the bigger issue of a taxpayer-supported entity improperly inserting itself in an election, lets examine the facts. A look at GM's annual SEC filings gives a clear picture of how many people were employed by the company both before and after the Obama Administration guided the company through a bankruptcy process.

AUTO BAILOUT BOMBSHELL: Fiat Says Chrysler, Jeep Production May Move to Italy

Obama Marchionne photoComing hot on the heels of speculation that some Jeep production may be moved to China comes a bombshell from a Bloomberg report. Fiat is now considering moving Chrysler and Jeep production to Italy.

According to the piece, "To counter the severe slump in European sales, (Fiat CEO Sergio) Marchionne is considering building Chrysler models in Italy, including Jeeps, for export to North America. The Italian government is evaluating tax rebates on export goods to help Fiat. Marchionne may announce details of his plan as soon as Oct. 30, the people said."

Romney is Right About Chrysler / Jeep China Outsourcing

Fiat Chrysler logosThere is nothing like having unbiased media coverage of the all-important presidential campaign leading up to next week's election. And the media is nothing like unbiased. We see this playing out again as Mitt Romney is now being accused of misrepresenting a story that Bloomberg.com reported on Chrysler's potential outsourcing of Jeep manufacturing to China. A look at the original comments from the article gives evidence as to how unfair the criticism is and just how right Romney was for pointing out the likely future outsourcing of Jeep manufacturing.

Syndicate content