GM Posts Largest Ever Automaker Loss (on paper)

Discussion in 'OT Driven' started by TriShield, Feb 12, 2008.

  1. TriShield

    TriShield Super Moderator® Super Moderator

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    GM Posts Record US Automotive Loss of $38.7B for 2007, Offers Buyouts to Hourly US Workers



    Tuesday February 12, 9:47 am ET
    By Dee-Ann Durbin, AP Auto Writer

    DETROIT (AP) -- General Motors Corp. reported a $38.7 billion loss for 2007 on Tuesday, the largest annual loss ever for an automotive company, and said it is making a new round of buyout offers to U.S. hourly workers in hopes of replacing some of them with lower-paid help.

    The earnings report and buyout offer came as GM struggles to turn around its North American business as the economy weakens.

    But GM Chairman and Chief Executive Rick Wagoner said that the company made significant progress in 2007, reducing structural costs in North America, negotiating a historic labor agreement and growing aggressively in Latin America and Asia.

    The Detroit-based automaker said it was offering a new round of buyouts to all 74,000 of its U.S. hourly workers who are represented by the United Auto Workers.

    GM won't say how many workers it hopes to shed, but under its new contract with the UAW, it will be able to replace up to 16,000 workers doing non-assembly jobs with new employees who will be paid half the old wage of $28 per hour.

    Ford Motor Co. and Chrysler LLC already have announced similar buyout offers.

    GM shares rose 24 cents to $27.36 in morning trading.

    GM's annual loss of $38.7 billion largely was due to a third-quarter charge related to unused tax credits.

    The 2007 loss topped GM's previous record in 1992, when the company lost $23.4 billion because of a change in health care accounting, according to Standard & Poor's Compustat.

    Excluding the tax charge and other special items, GM lost $23 million, or 4 cents per share, for the year, compared with a net income of $2.2 billion in 2006, beating Wall Street's expectations. Analysts polled by Thomson Financial expected GM to post a full-year loss of 95 cents per share.

    For the fourth quarter, GM posted a loss of $722 million, or $1.28 per share, in the fourth quarter, compared with a net income of $950 million in the year-ago quarter. Fourth-quarter charges included $622 million to Delphi Corp., GM's former parts division, for its restructuring efforts.

    GM reported $181 billion in revenues for the year, down from $206 billion in 2006. Its automotive business saw record automotive revenues of $178 billion in 2007, up $7 billion from a year ago thanks to growth in emerging markets and favorable exchange rates.

    GM was profitable in every region outside North America. GM's Latin America, Middle East and Africa division reported a record $1.3 billion in earnings, up 140 percent from 2006. GM's Asia Pacific division earned $744 million, up from $403 million in 2006, while GM Europe reported a profit of $55 million, down from a profit of $357 million in 2006.

    But GM's North American division continued to struggle, posting a $1.5 billion loss for the year, nearly identical to its $1.6 billion loss in 2006. GM's North American division also reported a loss of $1.1 billion in the fourth quarter, compared with a loss of $129 million in the year-ago quarter.

    Wagoner said the weak U.S. economy and high commodity prices hurt turnaround efforts in North America. He said GM's decision to reduce low-profit sales to daily rental companies by 110,000 in 2007 also affected U.S. sales.

    "We're pleased with the positive improvement trend in our automotive results, especially given the challenging conditions in important markets like the U.S. and Germany, but we have more work to do to achieve acceptable profitability and positive cash flow," Wagoner said in a statement.

    GM's results also were dragged down by its 49 percent stake in GMAC Financial Services, which lost $2.3 billion in 2007. GM reported a $1.1 billion loss attributed to GMAC.

    GM barely retained its title as the world's largest automaker in 2007, selling just 3,000 more vehicles than Toyota Motor Corp. GM sold a total of 9,369,524 vehicles worldwide, up 3 percent from the year before.

    [​IMG]
     
  2. RobsMob

    RobsMob Guest

    Ouch.
     
  3. 2ofdem

    2ofdem OT Supporter

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    I cant wait for VW and Toyota to be the only vehicle manufacturers in the world.
     
  4. Ghost of Swayze

    Ghost of Swayze Ofcourse you mad

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    wow, america sucks
     
  5. DittoAlex

    DittoAlex New Member

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    They finally realized they're getting crap product because their workers are fat, lazy rednecks who don't put any effort into their work.

    GM is going to be so good now :bowdown:
     
  6. 3030

    3030 3030 OT Supporter

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    FAIL.
     
  7. BigBronco

    BigBronco OT Supporter

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  8. BLoG

    BLoG Scented Meat

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    I was on a chevy/gmc/pontiac lot this weekend

    everything on the lot except for the vette and trucks was pure shit.
    They had posters for the new malibu, but they didn't even have one in the showroom, much less on the lot.

    They did have a red z06 that gave me wood though
     
  9. The Great Deceiver

    The Great Deceiver 21st Century Schizoid Man

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  10. CHOWBOX

    CHOWBOX OT Supporter

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  11. Ghost of Swayze

    Ghost of Swayze Ofcourse you mad

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    There plants are actaully productive...i think the engineering and design of the cars are more of the problem.

    I like GM and have had 2 of their cars but my Nissan Pathfinder >
     
  12. scrotomus

    scrotomus you're a scumbag

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    haha fucked by UAW
     
  13. DittoAlex

    DittoAlex New Member

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    Their fit and finish on their high-volume cars was so bad in the 90's that I've been ignoring GM in their sucky '00s, don't know if that has gotten better.

    The important decision-making buffoons will still be there, however. :(
     
  14. therealciviczc

    therealciviczc New Member

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    Why? I can see Toyota, but fucking VW?
     
  15. guest

    guest 

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    GM should just stop selling cars in North America and let Toyota handle all the sales
     
  16. therealciviczc

    therealciviczc New Member

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    The new GM cars seem way better than that 90s shit... but at the time the 90s shit seemed way better than their 80s shit, and in the end it was still mostly trash, so who knows.
     
  17. BLoG

    BLoG Scented Meat

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    My wife has been used car shopping.

    She had no previous bias towards imports or domestics (except that she likes mazdas)

    After getting into virtually every car we saw and just checking it out, she told me she has absolutely no interest in anything made by pontiac, buick, or chevy :rofl: The used car lots are saturated with grand ams, grand prixs, aleros, cavaliers (as well as tauruses), and all of them are completely awful :o
     
  18. Kokomo

    Kokomo OT Supporter

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    Yahoo
     
  19. 3030

    3030 3030 OT Supporter

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    Keep your wife.
    She's smart. :bigthumb:
     
  20. TriShield

    TriShield Super Moderator® Super Moderator

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    Pretty much.

    GM's problem is the company is not structured to be competitive. They don't need 8 brands, 50+ models, thousands and thousands of dealers, all their plants and the current size of the workforce is too big.

    All of this is going to sink the company.
     
  21. The Great Deceiver

    The Great Deceiver 21st Century Schizoid Man

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  22. Kevin

    Kevin New Member

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    Part of the reason i can't sell my condo :(

    2 other companies are sharing the blame as well, but i won't say who
     
  23. tolomei

    tolomei Leaving Las *****-Vegas

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    You're not Trishield.
     
  24. BLKDVLGSX

    BLKDVLGSX OT Supporter

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    honestly, if they designed cars that were worth 2 shits and a fuck, they wouldn't be having this problem
     
  25. hsmith

    hsmith OT Supporter

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    :rofl: and people bitch and moan when EXXON makes $40 billion :rofl:
     

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