Monday, November 10, 2008

Another day at the office for GM

With each passing day, headlines mount pointing to General Motor's imminent and spectacular death.

From Wall Street Journal Online:

"General Motors Corp.'s shares Monday plummeted to a price it hasn't seen since 1946, on rising concerns the auto maker will run out of cash in the next few months and that any government bailout won't be beneficial to shareholders.

Shares of GM fell 23% to $3.34 in late-morning trading, after earlier hitting a 62-year low of $3.02, as analysts at both Barclays Capital and Deutsche Bank cut their target prices and investment ratings on the stock.

Barclays now targets GM shares at $1, while Deutsche Bank slashed its target price to zero."


"It was recently reported that the plug-in Saturn VUE program was being moved from 2009 to 2011 due to GMs financial crisis. While partly true, the statement is not entirely correct.

GM had never stated the plug-in VUE would arrive in 2009.

GM spokesperson Brian Corbett has provided us the following statement:

“Our original statement said that production would begin “as soon as 2010” because we did not want to create artificial deadlines. We have dedicated significant resources to the program and it is progressing rapidly. Now that we are further along in the development process, we can now give a more up-to-date projection.”

Target shares for GM at $1 or less? Wow, that is brutal my friends. What is interesting to me about the plug-in Vue is that it could have been a major step in the right direction. Even though the vehicle is planned to have only a 10 mile EV only range, this is enough to offset many trips that would have required gasoline. If you had the ability to plug in your vehicle at work, then up to 20 miles of your commute could be oil free.

I find it rather comical that GM would talk about a plug-in Saturn Vue for 2011 when it is uncertain that they will make it to February. What is not comical is that it is nearly 2009 and there are NO production EV or PHEV vehicles for consumers. None are scheduled to appear from the major automakers next year either.

No comments: