GM concessions, Detroit 3 needs 34 billion

Well, we are getting info today at breakneck pace, as expected. First, let's have a look at some of the concessions and/or plans that GM is proferring to Congress:

From Automotive News:

"...GM will focus on its "core brands" of Chevrolet, Buick, GMC and Cadillac, the plan says. GM will sell Saab, shrink Pontiac to a niche brand and consider selling or closing Saturn, GM President Fritz Henderson told reporters at a briefing today.

GM also plans to trim its U.S. dealerships from today's 6,450 to about 4,700, Henderson said. It will cut about one-third of the nameplates from its vehicle lineup.

In the starkest acknowledgement GM has made of its financial condition, the company says it needs $4 billion in federal aid by the end of the month.

GM's plan asks Congress for $12 billion in loans by the end of March. It seeks another $6 billion in revolving credit if market conditions don't turn around.

Henderson said GM will seek a buyer for Saab. Pontiac will be shrunk to a "specialty, niche" brand, Henderson said. GM already has put Hummer up for sale.

Under its franchise agreement with Saturn dealers, GM will seek a new course for that brand, Henderson said. Asked whether GM would sell or fold Saturn, he said he would not eliminate any options.

Trimming GM's 6,450 U.S. dealerships to about 4,700.

Reopening talks with the UAW to cut manufacturing costs further."

Poor Saturn. Looks like they are history. The other thing that jumps out at me is GM's pressing need for 4 billion by the end of the month! WOW, where did that come from? Let's keep going and see what the new loan tally is.

From Automotive News:

"The Detroit 3 today increased their appeals for federal loans beyond the $25 billion requested in November.

General Motors, Ford Motor Co. and Chrysler LLC together are asking Congress to approve loans and credit lines that total $34 billion. The Detroit 3 submitted their business plans to lawmakers today.

House Speaker Nancy Pelosi said automakers will get help. "An intervention will happen," she said at a Washington news conference. Echoing industry leaders, the California Democrat said bankruptcy is not an option for any of the companies."

That is a pretty serious inflation rate, dontcha think? From 25 to 34 billion in a matter of weeks. Wow,

AND FINALLY, who does Nancy Pelosi think she is? The Prime Minister? The Shah? The Royal Grand Poobah? She obviously thinks that she controls the entire Congress. What a head job.

I think Ford and GM have submitted good plans. I just wish we had some assurances that they will stick to them!

GM News re-cap

Let's have a look at the events surrounding General Motors this past week. The biggest news is that the company petitioned the FAA to prevent public tracking of a corporate jet it leases. This is a strange request, don't you think? A GM spokesman, Greg Martin, had this to say, "We availed ourselves of the same option as others have", meaning the ability to ask the FAA for tracking exclusion. He went on to decline giving a reason for the request. Instead, we get to guess at the reason and all I can come up with is that tricky Rick Wagoner wants to jet-set without us knowing. You have any ideas?

In other news, GM is looking to raise one quarter of a billion dollars from the sale and leaseback of some of its European offices and other property assets. Normally, this would seem like a large sum of cash, but these are not normal times for the auto giant. When we last checked, General Motors was burning though 2.5 billion dollars in cash per month and nearing bankruptcy. This 270 million dollars it is trying to raise is apparently part of a push to raise 4 billion in asset sales and capital market transactions. I wish them well and hope they secure these funds to help them through these hard times.

I promise to keep you posted this week as the Big Three make their final pitch (at least the final pitch in 2008) for emergency government assistance. It should be fun to watch!

Gm cannot wait for Obama

I hate to give so much coverage to GM on this blog, but the news stories that break each day are fascinating. GM's Rick Wagoner was interviewed recently by Automotive News and the following is an excerpt from their website, www.autonews.com:

"General Motors CEO Rick Wagoner says GM's financial distress is so dire that it must line up financial assistance from Washington before President-elect Barack Obama takes office in January.

"This is an issue that needs to be addressed urgently," Wagoner said during an exclusive interview today with Automotive News. Now is the time to "overshoot, not undershoot" when it comes to assistance for the auto industry, he added."

That's right Rick, God help us if we "undershoot" our bailout funds! Gimme a break. Wagoner also stated that he should not resign, as a solid management team was needed during this difficult period. Whatever. News flash Ricky, the current management team is the BIGGEST part of the problem! If GM would not have bet the farm on SUV's, Hummer's and pickup trucks, then they would not be in this mess.

Wagoner continues his commiseration in the same interview:

"In return for financial aid, General Motors is willing to offer the government preferred stock, set limits on executive compensation and speed the introduction of fuel-efficient vehicles."

Speed the introduction of fuel-efficient vehicles, he says. Isn't it Pat Benatar who belts out those song lyrics, "It's a little too little, it's a little too late"?