To bail or not to bail...

[steveyfrac 73]

But now we're approaching "peak oil" and the dinosaur-based corporations can no longer survive, the well-heeled dividend crowd have their hands (or noses) out for free public money to keep themselves in the style to which they have become accustomed, instead of reinvesting in greener products for the new economy.

No one is really doing what you want. So there is probably a reason. If GM thought they could make a lot of money selling nothing but hybrid cars, they would. Keep in mind that toyota lost money on every prius they sold. It was/is a PR loss leader. And it has never made economic sense to own one anyway. It's just a hippy icon no matter how well engineered. Keep in mind that the toyota trucks do worse in fuel economy then their GM equivalents. And yet Toyota has this "Green" image.

Now all of a sudden in the span of a few years, GM has released more hybrid models then anyone else. They have more models that get over 30 MPG then anyone else. They have hybrid trucks. Something that toyotas system can't do. And they're developing a series plug in hybrid that for most people means they won't burn fuel in the normal commute.

No... Clearly GM isn't reinvesting in greener products. Clearly, they are sitting on their hands. The billion dollars they've invested in the volt? Pocket change, amirite? What more could you possibly want from them. I can't help but feel that this is mostly just socialist North America looking at corporate North America with disdain, rather then a rational thought process.

[Huronlad 186]

Now all of a sudden in the span of a few years, GM has released more hybrid models then anyone else. They have more models that get over 30 MPG then anyone else.

The only reason this is the case is due to the number of GM sub-brands. If the only difference in the vehicle is the badging and the shape of the body, then it is the same bloody vehicle period, regardless of what GM's PR people would have anyone believe.How does GM's average FE stack up to the competition? Are they even top 5? Not top 1 through 3 for sure. And after the EV-1 project the Volt really is a joke.

[Huronlad 186]

Keep in mind that the toyota trucks do worse in fuel economy then their GM equivalents. And yet Toyota has this "Green" image.

The LEV standards are based on emissions not fuel burned, are the GM engines as clean burning as the Toyota?

[smart142 605]

I can't help but feel that this is mostly just socialist North America looking at corporate North America with disdain, rather then a rational thought process.

Call me a socialist because I really can't feel sorry for GM and it's top executives. Should they not be accountable for the decisions they made that got them into this mess?I'm sure they have their golden parachutes packed and it will be the little people and the government who will be left holding the empty bag.The honourable thing for them to do would be to resign like the Japanese, or better yet commit hari kari.

[steveyfrac 73]

The only reason this is the case is due to the number of GM sub-brands. If the only difference in the vehicle is the badging and the shape of the body, then it is the same bloody vehicle period, regardless of what GM's PR people would have anyone believe.How does GM's average FE stack up to the competition? Are they even top 5? Not top 1 through 3 for sure. And after the EV-1 project the Volt really is a joke.

Toyota has the Prius, and the Camry and Highlander. Honda has the Insight, and the Civic hybrid.GM has the Malibu / Aura hybrid, the Tahoe hybrid, the Vue hybrid, and the Silverado / Sierra Hybrid. Even not counting the rebranded models, GM has at least as many hybrids as anyone else.As for GM's average FE, according to the CAFE numbers, the rank 3rd and 4th for domestic, and imported cars.REF: http://www.cars.com/go/advice/Story.jsp?se...ubject=fuelList

[Huronlad 186]

Toyota has the Prius, and the Camry and Highlander. Honda has the Insight, and the Civic hybrid.GM has the Malibu / Aura hybrid, the Tahoe hybrid, the Vue hybrid, and the Silverado / Sierra Hybrid. Even not counting the rebranded models, GM has at least as many hybrids as anyone else.As for GM's average FE, according to the CAFE numbers, the rank 3rd and 4th for domestic, and imported cars.REF: http://www.cars.com/go/advice/Story.jsp?se...ubject=fuelList

Check out a more current document, GM is way back to the middle/bottom of the pack. Their light trucks are averaging a lower FE than Toyota. For 2009 these numbers may move back in GM's favour. But everyone and their kid sister have hybrid vehicles to debut in the next year or two. GM will be forced back to middle of the pack or they will be bankrupt or dissolved by then.2008 CAFE Edited February 25, 2009 by Huronlad

[steveyfrac 73]

In then next year or two, the Volt will be released. I know there is a lot of skepticism about the volt, especially in light of the EV1. But the EV1 was way ahead of it's time. The cost to sell that car would have been in the 40k to 50k range, just to break even. They leased them at a loss because California was going to force them to do so. When the other car makers couldn't come up with competitive offerings, they backed down, and there was no reason to continue to loose money on the EV1. The volt is also a small car, and it's still expected to cost around 40k. Do you really expect that the public would have been willing to pay a high price for a limited car? The smart's two seater status limits it's saleability. Now image it could only go 200 km's between 8 hour charges. Oh, and it doubled in price. Can you understand where i'm coming from at least on the EV1, even if you don't agree? Personally, i think they should have let people buy them at market value, and continue making them. But don't put any more engineering dollars into it. They would have avoided all the bad PR they got over it.

[Huronlad 186]

Since the EV1 was being built mostly by hand due to the low production numbers, yes it was costly. Mass production could likely have cut costs nearly in half. The EV1 was no good for long trips, but a person could take the train or bus or even rent a vehicle for those times when they needed to travel more than 100 km round trip. The EV1 would be absolutely no use to you Steve due to your drive.The big issue I have with the Volt is that GM is touting the car as such a break through but due to the price of the vehicle it is going to be even more exclusive than the Prius. That and the use of such an inefficient body style to house a fairly efficient drive train. I can only hope that it does not get the same treatment as the EV1 and get axed to produce an inferior product that has a more generous profit margin.

[garthD 0]

I can't help but feel that this is mostly just socialist North America looking at corporate North America with disdain, rather then a rational thought process.

Call me a socialist because I really can't feel sorry for GM and it's top executives. Should they not be accountable for the decisions they made that got them into this mess?I'm sure they have their golden parachutes packed and it will be the little people and the government who will be left holding the empty bag.The honourable thing for them to do would be to resign like the Japanese, or better yet commit hari kari.

Yup, how could we not feel disdain for these former paragons of the capitalist economy? As long as there was profit to be had they championed the most rapacious forms of capitalism, but as soon as things get tough, they clamber to suck at the teat of the state. I think the phrase "socialization of risk and privatization of profit" sums up this rich irony perfectly? garth Edited February 25, 2009 by garthD

[MikeT 744]

"Corporate Welfare Bums"

[PrairieBoy 1]

Big heavy vehicles, turned into 'hybrids' ARE NOT THE ANSWER !! A hybrid Escalade or huge hybrid pickup is STUPID !!!The stupid people who are used to driving these monstrosities , are the ones who buy these (hybrid)vehicles, and think the're saving the planet. Americans, and to a lesser extent, Canadians need to think 'small'. Smaller, lighter trucks and cars can always get better milage than heavy gas sucking vehicles(even hybrids). Constant high gas prices will evetually force people to 'smart'--en up. GM thinks they can make the most money selling expensive hybrid models,and large vehicles.There may be some truth to that fact.Larger vehicles have traditonally ment larger profits. This proves that GM has NOT changed their way of thinking.Europeans have been making money selling small vehicles for many years.Gm has to find a new way of making money,selling smaller, lighter, fuel efficient vehicles that North Americans just can't live without!! Good luck!!

[steveyfrac 73]

Since the EV1 was being built mostly by hand due to the low production numbers, yes it was costly. Mass production could likely have cut costs nearly in half. The EV1 was no good for long trips, but a person could take the train or bus or even rent a vehicle for those times when they needed to travel more than 100 km round trip. The EV1 would be absolutely no use to you Steve due to your drive.The big issue I have with the Volt is that GM is touting the car as such a break through but due to the price of the vehicle it is going to be even more exclusive than the Prius. That and the use of such an inefficient body style to house a fairly efficient drive train. I can only hope that it does not get the same treatment as the EV1 and get axed to produce an inferior product that has a more generous profit margin.

The EV1 would be no use to me, true, but i would buy one for my wife in an instant. As for the volt, i'm hoping that enough early adopters come out of the woodwork to help nail down production costs. If enough people go for lithium battery technology, they are calling for the cost of the battery pack to be reduced to 25% of it's current cost in 10 years. That knocks $7500 from the cost of the Volt, not counting any kind of mass production benefits.The Volt is a game changer in the hybrid world. But all hybrids are marginalized by their higher cost. Not a single hybrid makes sense for me to buy. A honda civic hybrid has something like a 8k ante attached to it. 8k buys a lot of fuel. Even for me. At this point, the lower operating costs do not warrant the purchase of a hybrid vehicle. That probably remains true for the volt as well. However, something i'd love to see happen. Put a tiny, cost effective microturbine with foil bearings on it as the range extender for the volt. Efficiency would suffer a bit, true. Probably on the order of 15%. But it would be cheap to build, and make the car a lot lighter. Not sure what kind of durability hit you'd take vs a conventional engine. But the cost would probably make up for it, especially in a car that will probably rarely run it's engine for most people. Can't do that in a regular hybrid.

[steveyfrac 73]

Big heavy vehicles, turned into 'hybrids' ARE NOT THE ANSWER !! A hybrid Escalade or huge hybrid pickup is STUPID !!!The stupid people who are used to driving these monstrosities , are the ones who buy these (hybrid)vehicles, and think the're saving the planet. Americans, and to a lesser extent, Canadians need to think 'small'. Smaller, lighter trucks and cars can always get better milage than heavy gas sucking vehicles(even hybrids). Constant high gas prices will evetually force people to 'smart'--en up. GM thinks they can make the most money selling expensive hybrid models,and large vehicles.There may be some truth to that fact.Larger vehicles have traditonally ment larger profits. This proves that GM has NOT changed their way of thinking.Europeans have been making money selling small vehicles for many years.Gm has to find a new way of making money,selling smaller, lighter, fuel efficient vehicles that North Americans just can't live without!! Good luck!!

I live on a farm. A farm that uses, and needs large vehicles. Fuel efficiency is important in this segment to. Don't be too quick to call people stupid. This is a typical case of a company moving in the right direction, doing something meaningful, but the people complain because they're not doing it quick enough, or their not doing it the way that they want. Never mind that GM has more people, that are more intelligent, and that get paid exclusively to think about this stuff. Clearly, the proverbial arm-chair quarter back is the better player, n'est pas?It should also be noted that the other automakers are getting raped at the moment too. But the big guys in this climate are now the ones getting hit the worst. They have the most production capability, and thus the heaviest weight around their necks. Say what you will, but GM needs bailout money because of poor management of government financial policy creating one of the biggest financial storms of our generation. They don't need bailout money because they've been failing to sell cars, or because their cars aren't green enough. They still sell more vehicles world wide then anyone. They've given a lot to Canada, and to the states. They deserve our respect, and a loan. Notice that it's not a handout? It's a loan. That will be repaid. Given the alternative, a bailout makes the most sense.EDIT: I should add that apparently both the socialist government south of the border, and the conservative government apparently agree with me, since I believe they've both already arranged it all. Edited February 25, 2009 by steveyfrac

[ianjay 6]

Greetings:We have an Escape hybrid. It makes no sense economically, but like the smart, is fun to drive. Every trip becomes an adventure, waiting for the batteries to warm up and go into ev mode. It is always fun to listen for the transitions going from mode to mode.I doubt any solution, battery, hybrid, plug-in, ethanol will ever stand up to a cold analysis on how much things really cost. Only cheap to fuel, my smart continues to lead our household expenses in overall costs. And we have two other vehicles.Personal transportation does not make economic sense. Ian

[PrairieBoy 1]

The only people i was refering to as 'stupid' are not farmers or contractors who need large vehicles for work, or to pull rv's.My comment was directed at those who drive large trucks or large suvs all the time. Like in the city, going to work or just cruisingaround wasting gas and belching out pollution. If you're using a truck hauling stuff to the dump, or buying a fridge, picking up lumber etc, that ok.I went to drugstore the other day,and waited for a woman try to back her huge Cadillac Escalade out of the parking space.One person in the huge suv! These are types of people i would call stupid. 10 miles to the gallon..to buy a stamp!!

[ValgardForkbeard 2]

One person in the huge suv! These are types of people i would call stupid. 10 miles to the gallon..to buy a stamp!!

Come on, be fair; she might have been at the drug store to buy asprin, after seeing the bill from her last fill up.MG

[scwmcan 0]

The only people i was refering to as 'stupid' are not farmers or contractors who need large vehicles for work, or to pull rv's.My comment was directed at those who drive large trucks or large suvs all the time. Like in the city, going to work or just cruisingaround wasting gas and belching out pollution. If you're using a truck hauling stuff to the dump, or buying a fridge, picking up lumber etc, that ok.I went to drugstore the other day,and waited for a woman try to back her huge Cadillac Escalade out of the parking space.One person in the huge suv! These are types of people i would call stupid. 10 miles to the gallon..to buy a stamp!!

How do you know she (or her hubby) don't need the large truck to pull an RV etc. She only uses it for quick jumps into town otherwise (say less than 5000 km/year) and they cannot justify buying a small car for her to do this and hubby is driving something more economical on his longer commute to work? pleas note this is just to say don't be so quick to judge people, yes they may be stupid, or maybe they are doing what is financially correct for them, I agree it looks like they are being stupid, but unless you know their exact situation, you really can't say with certainty that they are (and I will be amongf the first to sy get rid of all the SUV's that aren't used for a practical purpose).Scott

[PrairieBoy 1]

Good point Scott, but i still believe that SOMEHOW ,we must ALL start to drive smaller vehicles on this continent to save fuel, and cut down on pollution.They have been doing it in Europe for years, so we all know it can be done. Too many people don't want to downsize, and will come up with all sorts of reasons not to. What about pulling smaller travel trailers behind smaller cars or trucks?Or using smaller motorhomes?No way! Everybody MUST have a LARGE truck pulling a 35 foot fifth wheel,or a huge 40 foot motorhome.

[scwmcan 0]

Good point Scott, but i still believe that SOMEHOW ,we must ALL start to drive smaller vehicles on this continent to save fuel, and cut down on pollution.They have been doing it in Europe for years, so we all know it can be done.

Too many people don't want to downsize, and will come up with all sorts of reasons not to.

What about pulling smaller travel trailers behind smaller cars or trucks?Or using smaller motorhomes?

No way! Everybody MUST have a LARGE truck pulling a 35 foot fifth wheel,or a huge 40 foot motorhome.

Don't worry agree that we need to downsize, it is a shame that there are so many people with truck and suvs etc. not mention cars that are commuting long distance with one person in them. It can't change overnight, but I think in the next few years as the big SUVs etc are ready to be replaced that people will be considering their options much more carefully (such as maybe keeping the old SUV/Truck for the towing and getting something smaller for everyday (if they can afford to do so). At least in Canada our top selling cars tend to be smaller than our neighbors to the south. I do wish more of the small cars from europe were available here, when are governments going to realize that we need a world standard for cars, not a different standard for each area. It would certainly make it cheaper to produce cars for worldwide distribution if they only had one standard to produce for.

In any case I was just trying to point out that even if we want to say that everyone who is driving by themselves in a big SUV or Truck is stupid (and I am as guilty as anyone) that they aren't necissrily, they just may only be able to afford the one vehicule and can't change it for whatever reason.

As for the motorhomes, I think they are getting less and less popular, but even in europe people tow some pretty large trailers, and have large cars )or even SUVs )to tow them just not as many as here. We in North america are use to having large things and will need to slowly reduce our expectations, people don't really need to buy 3000+ square foot homes either they just expect to be able to, I think this will change with time too.

Scott

[steveyfrac 73]

I do wish more of the small cars from europe were available here, when are governments going to realize that we need a world standard for cars, not a different standard for each area. It would certainly make it cheaper to produce cars for worldwide distribution if they only had one standard to produce for. Scott

This is something I agree very strongly with. Set a single emission standard. Make it as aggressive as you want, but have everyone conform to it. Make a single safety standard, have everyone conform to it. This stops the mess of having to design a north American car, then design a European car, or vice versa. It reduces design costs drastically. Then even though the diesels don't sell as well here, we could still GET them here. I'd kill for a new diesel smart. :'(

[PrairieBoy 1]

I also agree. The 'world standard' for safety, an/or pollution would be great. We would probably have access to many more vehicle choices.The 'big three' would probably fight this, as it may cut into their sales even more.But on the upside, may force them to changeor improve their vehicles even more.

[scwmcan 0]

I also agree. The 'world standard' for safety, an/or pollution would be great. We would probably have access to many more vehicle choices.The 'big three' would probably fight this, as it may cut into their sales even more.But on the upside, may force them to changeor improve their vehicles even more.

They might fight it, but it would allow them to sell their smaller more fuel efficient cars from other markets, which do compete in quality etc with other makes, in north america with no extra investment, I think even they might be able to see this would be a good thing.

[steveyfrac 73]

What i think they would fight, would be the fact that all european makes and models would be instantly for sale here without any additional cost. Mike could go buy a peugeot. I could go buy a Diesel Smart. <3

[lebikerboy 96]

There's more than emission standards that would have to change...

[smart142 605]

''Ousted CEO Wagoner got 167 percent raise, $1.8 mil bonus while GM ailed even before meltdown''

Monday, Mar. 30 2009 By Harkavy

While the share price of already ailing GM fell by nearly 17 percent during 2007, CEO Rick Wagoner's total compensation increased that year by 41 percent, from $10.2 million to 14.4 million, according to the company's proxy filing ahead of its June 2008 annual meeting.

In addition, Wagoner got a bonus of $1.8 million for his work during 2007, after receiving no bonus for 2006, says the filing, the most recent one filed by the company with the SEC because GM's 2009 annual meeting hasn't taken place.

The biggest chunk of Wagoner's 41 percent total pay hike for his stewardship of GM in 2007 was in his pension and deferred compensation, which skyrocketed by 167 percent, from $1.5 million in 2006 to 4.0 million in 2007, the records show. (See page 36 of the proxy filing PDF here.)

Wagoner has now been ousted from GM — forced out by the Obama administration, as was widely reported over the weekend. But that's more than three months since the government started clamoring for his ouster. (See my December 8 item "U.S. to GM CEO: Take a Hike," which cited this Wall Street Journal story: "Outside Pressure Grows for GM to Oust Wagoner.")

GM's future is clearly shaky, but Wagoner's own role in GM's executive-compensation decisions has been unclear, judging from the proxy filing, in which the company talked out of both sides of its mouth.

On page 58, the proxy noted a typical stockholder proposal asking for simply the right to vote on an "advisory resolution" to "ratify the compensation" of Wagoner and other top executives. GM, like nearly all other companies, urged shareholders to reject the proposal. GM management argued in part:

The [Executive Compensation] Committee, comprised entirely of independent directors, is responsible for overseeing the development and administration of the compensation and benefit programs for GM's executives.

That would apparently mean that, because Wagoner was the only board member who was not an "independent director" (as the proxy says elsewhere), he was not only not a member of the Compensation Committee but was also not "responsible for overseeing" executive pay.

But that seems to be directly contradicted by a passage on page 25, under "Role of Management in Compensation Decisions," that talks about how he "plays an active role" in executive compensation. The complete sentence is this:

Our CEO, Mr. Wagoner, believes compensation plays an important role in aligning and motivating the GM executive team to achieve key corporate objectives, and so he plays an active role in the development of our compensation plans.

And in fact, Wagoner and other execs are invited to sessions of the Compensation Committee, as a passage on page 12 says:

The Executive Compensation Committee may invite members of management to its meetings and such other persons as it deems appropriate in order to carry out its duties and responsibilities.

How golden his parachute will be is probably still unclear. But at least from now on, it appears that Wagoner will not be officially participating in GM's boardroom decisions on his or other top execs' compensation.

The automaker is on the precipice of bankruptcy, and, as noted above, the Obama administration is in effect ousting him from his dual GM jobs as chairman and CEO, as the Times (U.K.) reports in "Rick Wagoner to step down from GM in return for more aid."

Even before its precipitous drop since January 2008, GM's share price had sputtered ever since Wagoner became the company's president and chief operating officer in 1998.

The Times (U.K.) doesn't make the connection with Wagoner's 2007 total pay, but it does note that GM's losses didn't start occurring only after last year's Wall Street meltdown:

GM, which is the world's second largest car company by unit sales, has made $82 billion in losses in the past four years and would have gone bust at the end of last year if the US Government had not stepped forward with the loan.

The company lost its ranking as the world's largest automaker during Wagoner's rise to power (he was elevated to the dual jobs of chairman and CEO in June 2000). But GM's share price was moving alongside the Dow in June 2004 despite its growing troubles. Then, during 2005, GM's share price dropped by 53 percent (comparing its opening prices from year's beginning to year's end, but in this case from its January 3, 2005, opening price to its December 27, 2005, opening price). It generally held at that level lower than the Dow during 2006 and 2007 — but it began its more precipitous slide compared with the Dow even before the end of 2007.

During calendar year 2007, according to the automaker's proxy filing in April 2008, GM's share price consistently underperformed in comparison with indexes including the Dow. The Detroit automakers, by the way, haven't moved in lockstep: During 2005, for example, charts show that Ford, which was selling for far less than GM at the time, nevertheless skyrocketed in percentage during mid-2005 while GM fell and the Dow held steady. (See one version of GM's basic chart in comparison with Ford and stock indexes at Yahoo Finance.)

The automaker then began its final precipitous share-price drop in January 2008 — a drop more sharp in percentage than that of Ford and the major indexes.

GM's next proxy filing, which will officially reveal Wagoner's total compensation during calendar year 2008, probably won't be filed until next month.

..................................

Source.