GM loses $4.8 billion in the fourth quarter... loses $8.6 billion in 2005

[Analog]

DETROIT -- General Motors Corp. reported staggering losses for the fourth quarter and for all of 2005, dragged down by slumping sales at its ailing North American automotive business, massive restructuring expenses and costs related to the bankruptcy of former subsidiary Delphi Corp.

The automaker, which released preliminary results Thursday morning, lost $4.8 billion in the fourth quarter, compared to a loss of $99 million in the same period a year ago. GM attributed much of the loss to $3.6 billion in one-time charges, which included a $1.3 billion restructuring expense at GM North America and a $2.3 billion charge associated with GM?s benefit guarantee to former workers at Delphi. Higher costs and a weaker performance at the company?s North American division also contributed to lower earnings in the quarter.

Revenue for the quarter was $51.2 billion, down slightly from $51.4 billion in the year ago period.

For the full year, GM reported a loss of $8.6 billion, compared with a profit of $2.8 billion in 2004, after lumping special items into the fourth quarter and amid huge losses at its North American auto unit. The results mark GM?s first annual loss since 1992.

?2005 was one of the worst performances in GM?s history, driven by poor results in North America,? said GM Chairman and Chief Executive Rick Wagoner in a statement.

http://www.detnews.com/apps/pbcs.dll/article?AID=/20060126/AUTO01/601260445

 

[BDawg]

But don't worry, they're introducing new SUVs nobody wants to replace the old SUVs nobody wants.

 

[compuwiz1]

Employee pricing for all. That was idiotic!

 

[farmercal]

They need to take some lessons from the oil companies on how to turn a profit. Oh, my bad, the car companies have competition and don't own a monoply.

 

[Kroz]

I guess the customers have spoken. GM's cars suck (?)

 

[Lyfer]

I guess they should get into the public transportation business.

 

[Ktulu]

Originally posted by: Lyfer
I guess they should get into the public transportation business.

They already are

 

[MasterAndCommander]

Were those losses from their world-wide operations or just North America?

 

[Fingolfin269]

GM is being screwed by a lot more than their current lineup...

 

[JLGatsby]

Thanks a lot unions.

 

[EatSpam]

Congratulations to GM's management team. You suck.

 

[EatSpam]

Originally posted by: JLGatsby
Thanks a lot unions.

Yeah, the Unions decided to market crappy cars that no one wants and the Unions forced the Executives to take such massive salaries. :roll:

Face it, the workers have no power and what's happening to GM is coming from the top.

 

[JLGatsby]

Originally posted by: EatSpam
Yeah, the Unions decided to market crappy cars that no one wants and the Unions forced the Executives to take such massive salaries. :roll:

Face it, the workers have no power and what's happening to GM is coming from the top.

If you knew anything about how to run a business you'd know that yes, the unions did infact force GM to build crappy cars.

 

[Ronstang]

Originally posted by: farmercal
They need to take some lessons from the oil companies on how to turn a profit. Oh, my bad, the car companies have competition and don't own a monoply.

You are a dumbass who has no concept of how the oil industry or oil markets function.

 

[EatSpam]

Originally posted by: JLGatsby

Originally posted by: EatSpam
Yeah, the Unions decided to market crappy cars that no one wants and the Unions forced the Executives to take such massive salaries. :roll:

Face it, the workers have no power and what's happening to GM is coming from the top.

If you knew anything about how to run a business you'd know that yes, the unions did infact force GM to build crappy cars.

Why not explain it to me?

 

[Kroz]

Originally posted by: EatSpam

Originally posted by: JLGatsby

Originally posted by: EatSpam
Yeah, the Unions decided to market crappy cars that no one wants and the Unions forced the Executives to take such massive salaries. :roll:

Face it, the workers have no power and what's happening to GM is coming from the top.

If you knew anything about how to run a business you'd know that yes, the unions did infact force GM to build crappy cars.

Why not explain it to me?

Have you been living under a moss rock for the last 12 months? Really have you?!

GM's line up is mostly all big, gas guzzling, uneconomical vehicles.

Gas prices have risen to the point where prospective customers don't think they can afford to fill their gas guzzlers and keep them on the road. So they buy from another compant. There is GM's problem.

 

[JLGatsby]

Originally posted by: EatSpam
Why not explain it to me?

You know so many non-union plants in American which run by Japanese auto manufacturers are turning a profit and building quality cars? They spend less on wages.

You know what happens when you spend less on wages? You can spend more on quality parts.

GM is forced to pay for their expensive employees, so in order to compete price wise with the Japanese, they are forced to make less quality cars.

 

[EatSpam]

Originally posted by: Kroz

Originally posted by: EatSpam

Originally posted by: JLGatsby

Originally posted by: EatSpam
Yeah, the Unions decided to market crappy cars that no one wants and the Unions forced the Executives to take such massive salaries. :roll:

Face it, the workers have no power and what's happening to GM is coming from the top.

If you knew anything about how to run a business you'd know that yes, the unions did infact force GM to build crappy cars.

Why not explain it to me?

Have you been living under a moss rock for the last 12 months? Really have you?!

GM's line up is mostly all big, gas guzzling, uneconomical vehicles.

Gas prices have risen to the point where prospective customers don't think they can afford to fill their gas guzzlers and keep them on the road. So they buy from another compant. There is GM's problem.

No sh!t, sherlock. I know that and I point the finger squarely at the idiots running GM.

I asked JLGatsby to explain why the Unions are to blame for what I see as an Executive problem.

 

[EatSpam]

Originally posted by: JLGatsby

Originally posted by: EatSpam
Why not explain it to me?

You know so many non-union plants in American which run by Japanese auto manufacturers are turning a profit and building quality cars? They spend less on wages.

You know what happens when you spend less on wages? You can spend more on quality parts.

GM is forced to pay for their expensive employees, so in order to compete price wise with the Japanese, they are forced to make less quality cars.

Who decided that SUVs were the wave of the future and that hybrids weren't worth investing in? Who killed GM's EV1 electric car program?

I'm pretty sure the Japanese plants pay just as well as American plants. This has been discussed in other threads. I knew a guy who used to be a shift supervisor at Mitsubishi's North American plant... he was pulling down well in excess of $100K/year with overtime and from what he said, that's not unusual. Sounds just like a GM plant to me.

The real difference is that the Japanese executives care about their company and their employees while the American executives only care about making their own wallet fatter. Hence the short term thinking of American companies and the long term thinking of the Japanese companies.

And actually, according to this, Japan is more Unionized than the United States.

 

[JLGatsby]

Originally posted by: EatSpam
I'm pretty sure the Japanese plants pay just as well as American plants. This has been discussed in other threads. I knew a guy who used to be a shift supervisor at Mitsubishi's North American plant... he was pulling down well in excess of $100K/year with overtime and from what he said, that's not unusual. Sounds just like a GM plant to me.

The real difference is that the Japanese executives care about their company and their employees while the American executives only care about making their own wallet fatter. Hence the short term thinking of American companies and the long term thinking of the Japanese companies.

And actually, according to this, Japan is more Unionized than the United States.

No you're dead wrong. This has been featured on many national news programs. The Japanese owned plants in America do not pay as much as the American owned plants.

And Japan as a country being more unionized has nothing to do with American workers. Those stats are for Japanese workers in Japan.

The fact is that Japanese plants in America pay less and are able to build better quality cars because they're able to spend more on parts. This is not even in dispute with anyone.

 

[EatSpam]

Originally posted by: JLGatsby

Originally posted by: EatSpam
I'm pretty sure the Japanese plants pay just as well as American plants. This has been discussed in other threads. I knew a guy who used to be a shift supervisor at Mitsubishi's North American plant... he was pulling down well in excess of $100K/year with overtime and from what he said, that's not unusual. Sounds just like a GM plant to me.

The real difference is that the Japanese executives care about their company and their employees while the American executives only care about making their own wallet fatter. Hence the short term thinking of American companies and the long term thinking of the Japanese companies.

And actually, according to this, Japan is more Unionized than the United States.

No you're dead wrong. This has been featured on many national news programs. The Japanese owned plants in America do not pay as much as the American owned plants.

And Japan as a country being more unionized has nothing to do with American workers. Those stats are for Japanese workers in Japan.

The fact is that Japanese plants in America pay less and are able to build better quality cars because they're able to spend more on parts. This is not even in dispute with anyone.

So you think that management has nothing to do with GM producing the wrong kind of cars for the market? So what does management do if they don't set the direction of the company?

And as for American quality, my Saturn is just fine, thanks.

Edit: I should add that the Japanese Unions are relevant. They are a contributing factor to Honda, Toyota, etc.'s overall employee workforce, yet those companies manage to turn a profit. But, maybe their nationalized health insurance system has something to do with that... the Unions don't have to worry about that.

 

[desy]

They sell more cars thqan anybody
The problem is legacy costs, where for every employee they have 2.5 are on pension and benefits

 

[Eli]

:laugh:

 

[JLGatsby]

Originally posted by: EatSpam
So you think that management has nothing to do with GM producing the wrong kind of cars for the market? So what does management do if they don't set the direction of the company?

And as for American quality, my Saturn is just fine, thanks.

I think management does what it can given the situation it was dealt with.

You don't really understand the financial strain unions put in GM.

GM owes $60 billion to pension holders, but the entire company is only worth $12 billion. That is BY FAR the biggest problem GM is facing. Don't blame that on the management or the lack of fuel efficient cars. They were forced to accept those terms because of the culture of the time (the very populist 1960s).

The real fault is the culture of America in the 1960s. Unions were just a product of that culture. The populist culture infiltrated both sides of GM at the time, the blue collar and white collar workers and with that, they sealed the fate of GM for generations to come.

If GM did not owe that $60 billion, they would be very profitable building their gas guzzlers.

 

[IHAVEAQUESTION]

Actually you both are right. It's partly due to the management and partly due to the union. For example, GM union insists that the workers should only work on stuff that's on their job description. On the other hand, Toyota moves their workers around from units to units. This not only increases productivity but also improves employees satisfaction. I can go on and on...but you get the idea.