The SAAR (seasonally adjusted annual rate of sales) for the industry stood at 11.47 million vehicles which went down from 14.17 million a year ago. Jesse Toprak the analyst of TrueCar.com said the results were even bad than he had anticipated.

He further stated that “This was the worst August for the industry in 28 years, and if adjusted for population, we haven’t seen sales this bad since World War II. The domestic car makers had a relatively decent month, but clearly the second-half recovery will be much more sluggish than we had initially predicted.”

Don Johnson head of U.S. sales said “Last year’s cash-for-clunkers program spiked industry sales in 2009, so results this August were not surprisingly a bit mixed.”

In August 2009, the promotion introduced by the government directed at getting older, less fuel-competent cars off the road as a substitute for newer, more environment friendly models which actually set off big sales with skewing results.

These ran from elevated oil prices to hostile rivalry in China and its recognition of new administrators with no prior motor industry experience.

The US carmaker made the revelation in the “risk factors” section of its prospectus, which is indispensable by US law for IPOs.

GM alleged in the text that its revelation patterns and domestic control over financial coverage were “currently not effective” and could damage its financial situation and capability to do business in the future.

GM stated in its registering with the US Securities and Exchange Commission that
“Our US defined benefit pension plans are currently under funded and our pension funding obligations may increase significantly due to weak performance of financial markets and [the] effect on plan assets.”

GM further remarked that “It’s not possible for us to predict what the economic environment will be at our next scheduled re-measurement as of December 31 2010. Accordingly, discount rates and plan assets may be considerably different than those at June 30, 2010.”

The movement is known as “May the Best Car Win,” is part of G.M.’s endeavor to alter its lasting image as a economically stressed company with second-rate products. The first television ads will start on Sunday, featuring Mr. Whitacre, the 67-year-old former AT&T chief who was enrolled by the federal government to head G.M.’s restructured board.
Mr. Whitacre remarked in an interview, “I’m happy to do it, I wanted to do it, and I think it is important to do it. I am convinced that our cars are as good, if not better, than anybody else’s.”
G.M.’s gross sales in the United States have diminished by 35% this year, and its market share has sunk to a record low of about 19%. Mr. Whitacre has consecrated that G.M. must shoot the slip and start rising its sales.

Source : NY Times

1. Labor prices are too high!
2. Executive compensation and gains are luxurious!

Actually GM’S labor costs have to be decreased so that they can be competitive too.
Direct manufacturing labor costs are the major cost for GM unlike other auto makers. As GM is giving much more for their direct labor than any other car makers in the world, they are not in a situation to offer their cars at an economical price and still make a profit.
Just think that a janitor is paid $35 dollars per hour and this pay scale cannot be maintained. In reality GM has no command over labor costs.

The present political situation will not permit another company to function a productive auto plant in the United States. This is the reason which GM should probably take into mind and they should not be allowed to fail. The fall of GM is as predictable as our looming social security bankruptcy.
The troubles at GM spotlight an exceedingly sad position for large companies who want to be competitive in America.

Source: Gruber Company

Source: Seeking Alpha

The attitude of the dealers also is a “we’ll see” about the purchasing atmosphere as a result of the popular “cash for clunkers” motivation that goaded sales of new vehicles in the neighborhood and countrywide.

Mike Barron, the general manager of Heritage Pontiac-Buick-GMC-Honda stated that “We sold a total of 76 vehicles under the (cash for clunkers) program. Five have been paid by the government; as a result, five have had their motors disabled and have since been removed by Newell Recycling.” He also said that “the average gas guzzler could get around 14 miles per gallon, while the average mpg of the cars purchased is in the upper 20s. The average purchase price was around $20,000, he said”.

The cash for clunkers a federal program started in July and ended on Aug. 24. In addition to urging vehicle sales, it was meant to get old gas-guzzlers off the road.

Source: RN-T

In 2008, when Toyota surpassed GM up as the largest automotive maker, it was a historical moment in time and that is exactly what caused the demise of this incredible company.  Now, GM is in the mist of bankruptcy and the federal government is actually stepping in to take over GM and it is going to be run 70% by the federal government.

While many people might not be pleased with this particular step, GM is in trouble and we all know that the economy does not specifically rest on GM but it does definitely depend on this company that has been so stable for so many years.

We all know that GM is a company that is extreme trouble.  Not only are they going bankrupt, but they are phasing out cars that are extremely popular nowadays in an effort to save funds.  The economy is terrible right now and everyone in the world is looking for ways in which they can save a little cash and GM is no different.  They have actually found an answer is phasing out the Pontiac brand as a whole and the first step is going to be phasing out the Pontiac Vibe.

The Pontiac brand itself has been around for quite a while and to be honest, while this might have just happened on June 18, 2009, there are plans of phasing out more and more cars come later in the year.  GM is striving to cut all of the corners that they can and the Pontiac brand is something that can go and the funds can be used elsewhere.

GM has been producing the 2010 Vibe since roughly March and while this will not usually affect many of the plants that are open right now and building Pontiac models, it will definitely affect some of the factories that have strictly just been producing Pontiac products.  Suppliers will be affected and if you do not know already, GM stopping their production on this fantastic car is a huge deal.  It is just one step of the many that GM has to make in order to stay afloat.

Although GM will not be even just a sliver of its former company due to the fact that it will be owned by the government, the fact that this incredible company is going downhill so quickly is just prove that we are not in the best of times.

Although this incredible car is being discontinued and an incredible brand is being phased out, that does not mean that you have to look down all of the time.  GM is going to perk back up and while it might not be the company that it once was, it eventually is going to be a company that a lot of people are going to want to work for.

The Pontiac brand is a brand that is going to be missed severely, but as they continue to fade out and fade out brands, you will realize that there truly are a ton of different car brands out there and that you will absolutely be able to find one that suits all of your needs.  GM is not the top anymore, but that does not mean that you have to stop purchasing cars.

The program itself was signed into law by the President himself in June and the outline of it is: if you own a car that was built after 1984 with the miles per gallon of about 18, you can apply for this credit and trade-in bonus to be added on whenever you are shopping for a new car.  This law applies to SUVs, vans and pickup trucks.

When you go to a dealership with your gas guzzler, participating dealerships will assess your vehicle and apply the discount to a new vehicle and then the dealership will obtain a reimbursement from the government.  If you are looking for more details on this particular program, they are posted all over the internet.  Just a quick search and you should be able to find them.

This program was designed to help people get themselves into new cars/trucks and hopefully to help people buy cars and trucks again.  There is some hope out there that we will top our goal of selling about two hundred and fifty thousand vehicles this year and this particular program is something that should help it along.

People nowadays are constantly looking for a new way to help the environment, as many eco-friendly and hybrid cars are being designed and this is a great way to ensure that everyone is able to get one of these fantastic eco-friendly cars.  Hybrids are some of the most popular cars on the market and while they are affordable for the most part, some people would prefer to trade in their car and get a decent chunk of money off of the car – that is possible now via this program.

“It’s a wonderful program. It helps out the environment, it helps out the customer, and it gives a jump to the automobile industry when it needs it the most,” said Scott Gruwell, sales director of Courtesy Chevrolet, the Phoenix-based GM dealership that sold Metzler his Equinox.

Cliff Johnson, president of Texas Motors Ford, agreed “Are we excited about it? Absolutely! We think it is a great opportunity for people to get rid of their clunkers,” said Johnson, whose dealership in Fort Worth has about 250 vehicles on its parking lot.

Dealerships all over the world are welcoming this particular program in with open arms and it is one closing tool and selling tool that they have been using since it first went into law in June.  While of course, there are still some dealerships that are in limbo about this particular program, overall – the program has went over extremely well with people and constantly, dealers are selling up the perks of the program to any consumer looking to trade in their car for a more fuel-efficient car.

One of the major complaints that dealerships are having is the fact that their reimbursements are taking too long.  People are waiting months for their reimbursements and while every good program has some kinks, this is one thing that is holding some dealerships back from offering up and taking the program.  While most dealerships do not have a problem, it is only the select few that seem to be having issues.

The new GM is actually looking to shred it’s employee base down to about 40,500 by the end of 2009 through more buyouts, layoffs as well as other measures.  The cuts are going to add to the thousands that are currently unemployed and while the unemployment rates all over keeps growing and growing, GM is looking out for themselves it seems like.

Since about 2006, roughly sixty-six thousand United States workers, which is more than half of the factory worker jobs have left GM by means of buyouts and retirement packages.  The automaker is constantly looking for ways to cut costs and trim down the fat and cutting their workers loose.  All of this is to counteract the slow sales and the mounting losses that they are constantly receiving by employing workers for no production.

While the company seems to be concentrating their efforts on the blue-collar section of their factories – that is just how it seems, it is not actually the case, the company is actually cutting down their white-collar jobs as well by about 20 percent which equals out to be about six thousand more jobs.  Executive ranks will also be cut by another thirty five percent by the end of this year.

What a lot of people do not know about GM is that they have actually lost, since 2008 about thirty-one billion dollars and has taken a total loss of about eighty-two billion dollars in the last four years.  While it might have been ranked the top automotive producer in years before, it seems that Toyota is actually out ranking them now as Toyota sales are up and GM sales are way, way down.

GM, in the long run has always been a fantastic company to work for and has always been a company that people have been proud to work for, however, since the old GM has fallen and the new GM has taken over, it seems that jobs are becoming less and less – no matter if they are blue-collar or white.  No one in the world of GM seems to be safe and that is something that is sad.

Diana Tramblay, the GM VP of Labor Relations states: One of the very tough, but necessary actions to position the company for long-term viability and success is to reduce our total U.S. workforce, both hourly and salaried employees.”  In a recent interview and while they may be thinking about the future of GM and just what it can truly bring – what about right now?  Many people are wondering about that very question themselves.

GM is looking to restructure the way that they have been running things in the past and they are looking to update everything about the company itself and how decisions are made.  Committees are being formed and everything seems to be run by the government when it comes to the GM world right now.  However – that does not mean that the new GM is going to be a bad thing, right now, it is just different and people are losing their jobs – whether by taking the buyout or by ‘other measures’.

There are a deal signed the morning of July 10th, 2009 between the government and General Motors executives at the law from of Weil, Gotshal & Manges, which is GM’s chief bankruptcy counsel.  The CEO has to say: “Today marks a new beginning for General Motors, one that will allow every employee, including me, to get back to the business of designing, building and selling great cars and trucks and serving the needs of our customers,” CEO Fritz Henderson said in a statement on July 10th, 2009.

He has appreciated all of the support that GM fans and taxpayers have given them and while it might be a very hard road to earn back all of that trust, GM is willing to restructure the way they do things and really live up to the new GM name.  There are plans of GM releasing 10 new vehicles in the United States and another 17 vehicles outside of the United States in the next eighteen months, which is good news.

The GM management structure that is based on the Automotive Strategy Board, which is all made up of Global Function Leaders and Regional Presidents and its Automotive Product Board will be replaced with a single and smaller-scale executive committee that will meet every single week.

This particular committee will focus on all of the business results brands, customers, products and overall – how much profit GM is going to be making.  This smaller-scale committee will cut GM’s decision-making team in half and will eliminate a lot of GM’s matrix structure and while these are difficult decisions, they are ones that have to be made in order to really improve the company overall.

GM’s bankruptcy only lasted about thirty-nine days, but within those days, things were very uncertain and now GM has closed the deal on selling off some key components of the GM Company, such as Chevrolet and Cadillac to a new company that is mostly owned by the United States Treasury.

GM will also be cutting at its white-collar workforce as well, which is exactly what everyone seems to think it needs to do.  They are cutting back on their white-collar labor by about 20 percent, which means eliminating another six thousand jobs by October.  The reduction of the executives in rank will slice a lot deeper than most people anticipated.

Another pillar that GM is planning on launching and developing is more fuel-efficient cars and they are going to focus their energy on just a few brands and models – along with a couple of dealerships instead of expanding until they are stretched too thin.  That is exactly what happened here, they stretched themselves too thin for too long and now they have been burned by about $40 billion dollars with potential losses of over $80 billion dollars.

There is news however that the new GM will be slashing their debt and healthcare obligations by about $48 billion dollars and that they have dropped almost 40 percent of their dealerships that are unprofitable.  Brands like Saturn, Hummer and Saab are being cut loose and sold to other companies.  The new GM is really taking the time to cut unnecessary things out of their company and that is something that will help them in the long run.