GM out of bankruptcy, plans to sell on Ebay?

[Sstashmoo]

GM is out of bankruptcy protection and vows to turn itself around amid poor sales numbers, they even have an ambitious plan to sell cars on Ebay? Of all things.


""DETROIT – General Motors completed an unusually quick exit from bankruptcy protection on Friday with ambitions of making money and building cars people are eager to buy.
Once the world's largest and most powerful automaker, new GM is now leaner, cleansed of massive debt and burdensome contracts that would have sunk it without federal loans.
But GM, whose 40 days under court supervision was far shorter than anyone predicted, faces the worst auto sales slump in a quarter-century.
At a news conference, CEO Fritz Henderson said the revamped automaker will be faster and more responsive to customers than the old one. It will generate cash and repay billions in government loans ahead of a 2015 deadline.
The new company will build more cars and trucks that consumers want and launch them faster than in the past, the CEO said. GM also announced a partnership with online retailer eBay to test auctioning vehicles online.""


http://news.yahoo.com/s/ap/20090710/..._gm_bankruptcy

[Crumbled_pavement]

Paint me skeptical.

[Sstashmoo]

Same here, hasty reconstruction.

[Crumbled_pavement]

What did they actually do? Did they just alleviate debt? What actual restructuring did they do to prevent wasting funds? I haven't kept up much on GM's bankruptcy but I just don't see a bright future for them - but then that's my ignorance. Maybe things will pick up next year as the economy starts to recover?

[mjs]

The restructuring and savings plans were done before they filed. The bankruptcy was simply to dump the remaining non-revolving debt on others. Its a great competitive advantage to them that will improve their bottom line, but its not what they needed the most.

They won't be able to improve their market share until they replace most of their executives with people with engineering backgrounds. Their executives have to have a detailed understanding of how the product works, how its manufactured, and what R&D proposals make sense. A super majority of attorneys and ad execs don't cut it.

[Sstashmoo]

Quote: "They won't be able to improve their market share until they replace most of their executives with people with engineering backgrounds."

Agreed. Looks as though they are cutting their top end by 20%.

[mjs]

It would be nice if you included a link so the rest of us can know what you are talking about. Are you refering to this?

New CEO Fritz Henderson is preparing to cut another 4,000 white-collar jobs, including 450 executive-level employees such as plant managers or engineering group heads.

http://news.yahoo.com/s/ap/20090708/.../us_the_new_gm Actually, quite the opposite of what I'm talking about. Plant managers and engineering group heads are the minority that have "a detailed understanding of how the product works, how its manufactured, and what R&D proposals make sense". Its the beuracrats in between them and Henderson that are making GM noninnovative. Cut 80-90% of these jobs in between until these positions have just one or two people between them and Henderson.

I'm specifically talking about the backgrounds of these people. They need to replace a great many of these people with engineering heads and plant managers who will cut the positions I described. http://www.gm.com/corporate/about/officers.jsp

[Sstashmoo]

Market trends and costs dictate what they build. They only build what people will buy. Gas doubles over a weekend and all of a sudden the small car importers are geniuses in your eyes. They were building SUV's and Trucks because people were buying them before oil spiked.

I keep hearing about all these super solar and battery cars, where are they?

[mjs]

Are you sure it all happened over a weekend? Since you feel its not due to the industry itself, but rather the President and Congress, show me when the people who you like were in charge. Find me the chart that shows that management adjusted manpower at a matching gradual reduction with expensive and destructive methods such as attrition rather than in spurts and surges with methods like massive layoffs, buyouts, and plant closings every fifteen to twenty years. Prove to me that GM executive pay and number of VP positions aren't inverse to this graph.

[Sstashmoo]

Figure of speech?

[Mikeg]

Here is a copy of the "GM Retiree eNews" I received earlier today. Scroll down to the very last Q & A for more information about their pilot/test program with Ebay.

GM Retiree eNews
July 10, 2008

What’s Happening Now

The New General Motors Company Launches Today

GM President and CEO Fritz Henderson told employees that today [[July 10) marks “a new beginning� for General Motors that will focus on customers, car and culture.

Created from the old GM’s strongest operations in an asset sale approved by the bankruptcy court on July 5, the new GM will “have a fresh start with a new corporate structure, a stronger balance sheet, and a renewed commitment to make the customer the center of everything we do at GM,� he said.

Henderson made several announcements related to flattening the organization and speeding decision making:

• The Automotive Strategy Board and Automotive Product boards will be replaced by a smaller Executive Committee that will meet more frequently to focus on business results and products, brands and customers.
• The matrix structure is being eliminated to simplify the organization and establish clear accountability for performance.
• The GM North America President position and the GM North American Strategy Board will be eliminated. Global functional leaders will have responsibility for running their part of the business in North America.
• The regional president positions and the regional strategy boards are being eliminated, removing a layer of management.
• Edward E. Whitacre, Jr. will serve as chairman of the GM board with a number of new directors. Henderson will continue as president and chief executive officer and will also take responsibility for GM’s operations in North America.
• Nick Reilly is named executive vice president of GM International Operations [[GMIO). GMIO will be headquartered in Shanghai, China.
• Bob Lutz has agreed not to retire, and instead will join the new GM as vice chairman responsible for all creative elements of products and customer relationships. Lutz and Tom Stephens, vice chairman, product development, will work together as a team, partnering with Ed Welburn, vice president of design, to guide all creative aspects of design. GM’s brands, marketing, advertising, and communications will report to Lutz for consistent messaging and results.

Additional details of the new structure and leadership moves will be communicated later this month, said Henderson. “These and other actions will simplify our organizational structure and reduce the level of bureaucracy that, in the past, has prevented GM from moving faster.�

Henderson concluded by thanking employees for their commitment: “We recognize that we’ve been given a rare second chance at GM, and we are very grateful for that,� he said. “We are deeply appreciative for the support we have received during this historic transformation, and we will work hard to repay this trust by building a successful new General Motors.�

Answer Me Now

Q.

What is the official name of General Motors, since it is no longer General Motors Corporation?

A.

The sale that was approved on Sunday night means that most of General Motors Corporation’s assets will be sold to NGMCO, Inc., which is an entity funded by the U.S. Department of the Treasury. Once the sale closes, NGMCO, Inc. will change its name to General Motors Company and will continue to operate using GM’s historic corporate and sub brands. After the sale closes, the remaining assets under the current General Motors Corporation will change its name to Motors Liquidation Company.

General Motors Corporation will become General Motors Company, marking an new chapter in the company’s history.

Q.

Who owns General Motors Company?

A.

The General Motors Company’s common stock will initially be owned by:

• U.S. Department of the Treasury: 60.8 percent
• UAW Retiree Medical Benefits Trust: 17.5 percent
• Canada and Ontario governments: 11.7 percent
• Motors Liquidation Company: 10 percent

Q.

What facilities were not acquired by General Motors Company?

A.

GMVM - Wilmington Assembly
Stamping - Indianapolis
GMPT - Flint North
GMPT - Livonia
GMVM - Pontiac Assembly
Stamping - Pontiac North Campus 1
Stamping - Grand Rapids
GMPT - Willow Run
GMPT - Massena
Stamping - Mansfield
GMVM - Moraine Assembly2
GMPT - Parma Complex3
Stamping - Pittsburgh
GMPT - Fredericksburg
GMVM - Shreveport Assembly
Stamping- Shreveport

Q.

Are we changing our logo?

A.

Currently, we have no plans to change our logo and talking about the pros and cons of a logo change hasn’t been the top priority with all that is happening in our company right now. At some point in time, it might be appropriate to look at how we might refresh or enhance our logo. Cost would certainly be a component of that discussion.

Q.

How will the U.S. Government be repaid and by when?

A.

Under the terms of the financing with the U.S. Treasury and Canadian Governments, GM is required to repay the $6.7B in debt it owes the U.S. Government and $1.3B in debt it owes the Canadian Governments by 2015, but our goal is to repay them much sooner. The U.S. and Canadian Governments are likely to also recoup a portion of their investment upon monetization of their equity ownership positions.

Q.

What is the auction testing that is going on in California that was discussed by Fritz today?

A.

This is a pilot/test program that builds on the successful relationship our dealers have had with ebay promoting GM Certified Used vehicles. It is an innovative partnership between ebay, GM and its dealers to offer consumers a new way to shop and purchase vehicles. GM will not sell directly to customers. All purchases will still be conducted through our existing dealer network. This test will be launched in California only and we will evaluate the effectiveness and consumer acceptance of the program before looking at further opportunities.

[jiminnm]

It seems that many of the "old" GM properties with environmental issues have been left with the bankruptcy court to sell or otherwise dispose of. I expect that means we will all be responsible for paying to clean up those properties.

[Lowell]

I like the eBay thinking. Auctioning off your excess inventory is a lot better than sitting on it. The web is where people go to shop and where value gets determined in open auction. If I had their ear, I would have them use Craigslist too with old-fashioned '$XXXX or best offer'.

GM doesn't have to just get better at making cars, it also has get better at selling them.

[East Detroit]

I think its a bad idea. It will diminish the perceived value of their products and their company.

However, I am not sure how much more you can diminish them since they basically are owned by the government, screwed over their suppliers and screwed over their retirees. Then again, people don't care about other people. They will just buy what is cheapest for "ME and MY."

[Retroit]

I have no confidence in Government Meddlers and if I have to buy a car in the near future it will be a Ford, even though I've been a loyal GM customer till now. Neither Whitacre and Henderson impress me; Lutz will be GM's saving grace. And ditto everything mjs said! Unless GM is willing to concede that they must imitate Toyota, Honda, Kia, etc. in order to succeed, they will eventually return to old habits.

Our bankruptcy laws need to be change: Liquidation only, no reorganization. Companies should not be allowed to dump their creditors and shareholders, and then "reorganize" as a "new" company. What a f-ing joke. Why not declare bankruptcy every year? GM could have made all the changes that they have without declaring bankruptcy. The only difference is they no longer have to be accountable to their creditors/bondholders/shareholder. Disgusting!

I doubt the E-bay thing will work. It's not like you are going to buy a new car from a dealer in California and have it FedExed to you. You still have to go to the dealership to pick up the car. With less dealers, it's not like there are going to be many nearby dealers to choose from. But, hey, if they can sell a few extra cars, why not?