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GM Australia Good Shape

Posted: June 1st, 2009 | Author: | Filed under: Auto News, Auto News, gm, Grilled | Tags: , , | Comments Off on GM Australia Good Shape

It seems the Australian subsidiary of GM (Holden) has managed to hitch a ride with New GM and is not being left behind like SAAB and Hummer, or sold like Opel in Germany and Vauxhall in the UK.

Whether this is good or bad remains to be seen. The Opel example is not great – the plan for it to be taken over by Canadian parts maker, Magna, with government support, is already turning messy and may yet fall apart in the German parliament.
Staying with New GM is not exactly a guaranteed future. Relieved of three-quarters of its debts, four loss-making brands, 14 factories and a quarter of its dealers, the New GM will no doubt make a profit almost immediately, but this will just be a shiny new vehicle for the showroom, still waiting for an engine.
GM has not gone bust because of a short-term problem with the global financial crisis; it has lost $US82 billion in four years because of decades of poor management and bad decisions.
Like a lot of American businesses, GM has been dominated by a culture focused on short-term results and management bonuses, sacrificing innovation and fuel efficiency, as well as better long-term deals with the union.  The warning signs have been there for two decades.
One of New GM’s plans is to re-tool one of its big Detroit plants to produce America’s first small car. It would be appropriate if that were the Hummer factory.
The collapse of General Motors is a stunning catastrophe for the United States, a significant marker on its decline as an industrial power. Shareholders will be wiped out, lenders almost entirely wiped, tens of thousands will lose their jobs, thousands of car dealers will lose their franchise, and one of the world’s biggest industrial companies will be nationalised.
The profitable plants and brands of GM will be transfered to a new entity that will be more than 72.5% owned by the US Government, 10% by bondholders through the “old GM” and 17.5%by a vehicle designed to fund health care liabilities to former employees and managed by the United Auto Workers Union.

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