GM: Bailed out and now bailing on the US?

[Deleted]

GM was bailed out back in '08, and now they're laying off staff here in the States, but not slowing down off-shore production.

Is this a sign of things going belly up?

www.nytimes.com/2018/11/26/business/general-motors-cutbacks.html

[Ozarks Tom]

What's that saying about honor among thieves? There used to be another saying "As goes GM, so goes the country."

I don't want the government going totally socialist and commandeering private industry, but we really need to look at whatever subsidies these huge corporations are currently getting, and what tax loopholes they're using. Rush Limbaugh today was talking about the ridiculous subsides the taxpayers are on the hook for with electric cars. Why are taxpayers paying someone to buy an item?

The people running GM will say they're just fulfilling their fiduciary duties in maximizing profits for their shareholders, which I can't disagree with. But, they have another duty to consider, that of not sabotaging the economy of the country that grew them. Another old saying "Dance with the one that brung ya."

[blackfeather]

President Donald Trump has asked federal agencies to look for ways to cut subsidies to General Motors following the automaker’s plans to close factories and lay off thousands of workers.

www.zerohedge.com/news/2018-11-28/trump-tells-agencies-find-ways-cut-gm-subsidies-buyout-offer-details-emerge

Both them and Ge are starting to have problems.. It looks like GE won't survive.

...And they are both telling us the US economy is in huge trouble. ..... Of course GM doesn’t have 3.8 billion dollars just lying around, and so they are actually going to have to borrow money in order to close these plants and lay off these workers. ...........if General Motors had been much wiser with their money, they wouldn’t have had to initiate a “restructuring” so quickly.

Over the past four years, General Motors spent a staggering 13.9 billion dollars on stock buybacks.

GM executives were able to prop up the stock price for a while, but at this point the stock is down about 10 percent from where it was four years ago.
...........................................
In the end, GE is probably heading for total collapse.

But if GE had not blown 40 billion dollars on stock buybacks in recent years, they would be in far, far better shape.
.............
For years, big corporations have been borrowing massive amounts of money to fund reckless stock buybacks, and that has helped to fuel an amazing bull market run.

But now the game is imploding, and the unraveling of this massive Ponzi scheme is not going to be pretty.

www.zerohedge.com/news/2018-11-27/gm-ge-were-both-victimized-same-ponzi-scheme

[Ozarks Tom]

blackfeather, Just like we talked about in another thread regarding stock buy backs, the management cashes in now, and to hell with the hindmost.

[paisley]

The Obama Administration has pledged to invest at least $50 billion in GM after it's restructured. That may help save the company in the long run. But the signs so far are not good for saving the health benefits of GM's 1 million employees, dependents, and retirees. For that, they may have to look to Congress for healthcare reform.

www.cbsnews.com/news/gm-retirees-will-see-health-benefits-cut/www

[willowgirl]

From what I've heard, part of the restructuring is due to the fact that GM was making cars that weren't selling in a market where SUV sand light trucks are more popular. While the layoffs and plant closures are painful, it's probably better if the company restructures in order to be profitable, rather than requiring another bailout a few years down the road.

GM announced a year or so ago that it was moving to making all electric cars, but I suspect it bet on the wrong horse there. I wrote a piece for a liberal forum (which subsequently banned me, lol) a couple of years back demonstrating (via statistics) that far from being the wave of the future, electric cars actually had peaked and were declining in popularity.

That's not to say that at some point the technology won't improve to the point where EVs have more widespread appeal, but so far they've largely been novelty items, tokens used for virtue-signaling by good progressives.

While the Obama administration stopped short of requiring GM to build more electric cars in exchange for its TARP bailout, I think we can be sure some back-room pressure was being applied. Fast forward to 2018: it's clear Trump won't enforce this agenda, and in fact rolled back the CAFE standards that were expected to give electric cars a boost.

And that's all I can come up with at the moment, because Numb is playing the Trololo song, so it's hard to concentrate.

[paisley]