- Sales Wilt in July - It's a First: Detroit 3 Market Share Dips
Below 50%, Richard Truett & John K. Teahen Jr., Automotive News, 8/1/07.
For U.S. Automakers, July was the darkest month in the 102-year history of
the automobile business in the United States. For the first time,
foreign manufacturers controlled the market.
General Motors was down 22.3 % July'07 vs. July'06 (GM is also down 9.4%
the 1st 7 months in 2007 vs. 2006).
GM had almost no bright spots, and no indication that August will be any
better than July. Paul Ballew, GM's executive director of market and
industry analysis, said, "We didn't have a terrific retail month for sure,
but it's better than June."
- General Motors, Toyota Swap Lead in Global Market, Harumi
Ozawa, YAHOO! FINANCE 7/20/07. ...it's (GM's)
Japanese rival came out on top for the first half of the year. Toyota
beat GM for the first six months to (through) June as a whole, selling 4.71
million units against GM's 4.67 million units.
An auto analyst at Fitch Ratings, Tatsuya Mizuno, said, "It was
inevitable the U.S. automaker would hand over its crown to Toyota at the end
of 2007, ending GM's 76-year reign as the world's best-selling automaker."
- Wake-Up Call: Toyota Outsells GM, Tom Nemet, Automotive News,
7/2/07. What is the meaning of
Toyota Motor Corp. outselling General Motors worldwide
in the first quarter of this year? Although purely a commercial
matter, those developments have hurt U.S. prestige worldwide.
Concerns Shroud Ford/GM as Union Talks Loom, Reuters/Detroit, 7/19/07.
Andrew Wilkinson, Senior Analyst at Interactive Brokers Group, noted that
implied volatility of 41% for GM options earlier this week was the highest
reading, "since February when shares tumbled when the Tracinda Group threw
in their cards and left the poker table." Billionaire Kirk
Kerkorian's investment arm, Tracinda Group, sold its stake in GM last year
following the automaker's rejection of his proposed tie-up with
Nissan-Renault. Implied volatility can be read as a % measure of how
much stock is expected to move in a rolling 12-month period. Brian
Overby, an options analyst with TradeKing, said the large number of
outstanding put options in GM and Ford...shows that "the options market is
worried about the long-term aspects of both."...indicative
prices point to a roughly 32% default risk for GM.
- Ghosn: No Desire to Run GM, David Guilford, Automotive News,
7/13/06. GM's board last week approved exploratory talks on a
three-way alliance with Nissan and Renault, increasing
the pressure on GM's (CEO) Wagoner at a crucial point in the automaker's
- How can Rick keep Kirk (Kerkorian) at bay? Be like Carlos (Ghosn:
CEO of Nissan/Renault), Charles Child, Automotive News, 7/12/06.
GM critics, insiders and outsiders, complain that the company's culture lacks
accountability. (GM) Executives are rarely broomed for poor performance,
even though they have collectively dribbled away 6.8 percentage points of U.S.
market share in the last 10 years. If he (Rick
Wagoner) stated Ghosn-like goals and met them, he could tell Kerkorian (who
controls 9.9% of GM stock) to back off -- with the support of GM's board.
Wagoner would have to lay his GM career on the line. But
it already is.
- Chief Named for Troubled G.M. Unit, N.Y. Times, 5/31/06.
Troy Clarke will take over as President of G.M. North America on July 1.
His job is to regain the market share that the world's largest automaker has
surrendered to foreign competitors. G.M., which
held about 28% of the American market in 2002, ended April with 23%.
- Is Flint's past a blueprint for GM's future? Edward
Lapham, Automotive News, reported on 5/4/06 that "Delphi, GM and the UAW are
nearing crunch time. Before you know it, U.S. Bankruptcy Judge Robert
Drain could rule on Delphi's motion to void its labor agreements. And if
Judge Drain tosses the contracts, the UAW and other unions that represent
Delphi workers may well strike. This in turn could
trigger...GM running for the cover of Chapter 11."
- General Motors on Thursday (4/20/06) posted its 6th straight
quarterly loss, reported Automotive News. Excluding a $1
Billion health-care restructuring charge, GM reported a loss of $323 Million
- "GM Posts Worst Loss Since 1992"
General Motors LOST $10.6 BILLION in 2005! NY Times 1/27/06
- "What's next for GM workers?" With
GM cutting 30,000 hourly jobs
(representing 22% of GM's union workforce in the U.S.)
and at least 2,500 salaried positions (in the
U.S. with additional cuts in Canada as well), thousands of workers at the
automaker face an uncertain future. CNN/Money, Jeanne Sahadi, 11/25/05
- "GM's big shakeup" General Motors Corp.
said...it would close or scale back operations at
about a dozen U.S. and Canadian locations in a bid
to...halt huge losses in its core North American auto
Chris Isidore, Nov. 21, 2005
- "GM's perfect storm" The
Delphi bankruptcy raised the risk of
a bankruptcy filing at GM within the next two years to 30
percent, according to a note by Banc of America Securities auto analyst Ron
Tadross in October. He's since raised that estimate
to 40 percent and now says that
a filing at some point is "inevitable." CNN/Money,
Chris Isidore, Nov. 18, 2005
- GM has seen its slice of U.S.
VEHICLE SALES slide
to 23% (as of April, 2006) over the last 30 years.
MARKET SHARE has declined by 47%
versus GM's market share of 43.8% in 1980.
CNN/Money, Chris Isidore, Nov. 18, 2005
- "Pressure Mounts for GM's Rick Wagoner"
This year alone, the carmaker has lost...record billions, shocked investors with earnings restatements,
seen its stock plunge to new lows, come under investigation by federal
regulators and given up significant U.S. market share to foreign rivals.
shares, which have lost more than 46 percent of their value this year, spiraled
to an 18-year low.
company losses, Delphi crisis and stock woes, analysts say CEO may be on the
CNN/Money, November 16, 2005
GM CEO Rick Wagoner detailed the
company's job-cut plans but declined
to say when the troubled automaker
might return to profitability.
- "ABC NIGHTLINE: ABC NEWS" Ted Koppel (ABC News),
"At the end of 1997, General Motors had a total of
8,653 dealerships around the country. By the end of 2004 (in 7 short
years), the total number of GM dealerships around the country had actually
gone down by more than 1,000." ABC News,
- "SEC subpoenas GM" General Motors Corp.
confirmed...that the Securities and Exchange
Commission (SEC) has subpoenaed records from it about its accounting
practices, creating further headaches for the already embattled
automaker. CNN/Money, Chris Isidore, Oct. 26, 2005
- "GMAC Financial Services Will Sell Up to $55 Billion in
Auto Loans" General Motors Corp.'s GMAC
financial services unit said...it will sell up to $55 billion worth of U.S.
auto loans to Bank of America Corp. over the next five years in
a deal to raise cash...
hurt...when Standard & Poor's Ratings Services and
Fitch Ratings downgraded both GM and GMAC's debt to "junk" status,
increasing borrowing costs.
DURBIN AP Auto Writer, The
Associated Press, DETROIT, Oct 17,
Jamie LaReau of
the Automotive News reported on April 3rd, 2006 that
the first phase of the GMAC sell-off has begun.
General Motors sold 51% of its its stake in GMAC, which
equated to $14 Billion, "in an effort to turn (GM) around."
"GM to sell stake in Isuzu for $300
Million" - Automotive News reported on April 11, 2006
that General Motors will sell its 7.9% stake in Japanese truck maker Isuzu
Motors Ltd. for $300 Million, unraveling a 35 year equity alliance to raise
much-needed cash to revive its ailing business.
- "Next GM worry: Disappearing dividend" Analysts, union
push automaker to stop paying $1.1B on shares. But will that sink stocks
further? Among the dark clouds hanging over General Motors' stock, add
this question: How much of its already battered value is dependent on a
dividend that few expect to continue at its current level?
GM's STOCK direction is going the
"Some of the dividend mutual funds
will likely have to sell their GM shares soon," says a former auto analyst,
Josh Peters, also the editor of
Morningstar Dividend Investor, a newsletter for the mutual fund tracking
Peters adds, "That
eliminating the dividend will be another signal to
investors about how little importance
they have among GM
decision makers." CNN/Money, Chris Isidore, Nov. 23, 2005
The U.S. auto industry's slump hit GM hard in March, when the struggling
automaker's sales fell almost 15%,
while rival Toyota reported its highest monthly sales yet. Toyota's
sales rose by 7% for the month!
DURBIN AP Auto Writer, The
Associated Press, DETROIT, April
General Motors of Canada saw its sales slip in May, while Toyota Canada gained
further market share,
breaking its sales records for a second straight month. Toronto
(Reuters), June 2, 2006
- "ABC NIGHTLINE: ABC NEWS" Ricardo Sanchez
(former GM dealership owner) says,
"I'm probably out at least a million dollars (because of
the partnership with GM)." William
Adkins (former Chevrolet dealership owner) says,
"They (GM) damaged and destroyed a lot of people's lives." ABC News, Nightline, 11/15/05
- "ABC NIGHTLINE: ABC NEWS" Dave Marash (ABC
News): "Several dealers are suing General Motors
because...too much control often executed with too little concern for the
dealer's interest." "...GM failed to back
up their dealer when trouble surfaced." ABC News,
Nightline, November 15, 2005
- "ABC NIGHTLINE: ABC NEWS" Dave Marash (ABC
News): "Demetrius Patterson (reporter) broke the story of GM's troubles with
its minority dealers in the regional chain of Gannett's Westchester County,
New York, newspapers. Patterson says his story caused problems at
Gannett. His evidence, this national story never made it to Gannett's
national wire. And he adds he was pulled from the GM story. And
when he objected to the reassignment, he says he got warnings from executives
at both Gannett and GM. One GM executive told
him the fable of a gnat bothering the backside of an elephant."
(reporter) quotes what one GM executive told him
(Dave Marash of ABC states that, "GM officials confirm
this conversation did take place"): "When
the elephant gets tired of that gnat, the elephant will sit down and squash
that gnat. And he said to me, 'Demetrius, you should think of
General Motors as an elephant and yourself as a gnat.' "
ABC News, Nightline, November 15, 2005