From the Wall Street Journal


A Portrait of My Industry

By RICK WAGONER
December 6, 2005; Page A20

DETROIT -- Since mid-October, General Motors has announced plans to cease production at 12 North American manufacturing facilities and eliminate 30,000 jobs by 2008; trim $1 billion in net material costs in 2006; and, in cooperation with the United Automobile Workers, reduce GM's retiree health-care liabilities by $15 billion, or about 25%, for an annualized expense reduction of $3 billion.

The reason for these dramatic actions is no secret: GM has lost a lot of money in 2005, due to rapidly increasing health-care and raw-material costs, lower sales volumes and a weaker sales mix -- essentially, we've sold fewer high-profit SUVs and more lower-profit cars. What is less clear is why things turned sour so fast for GM, as well as for other American auto makers and suppliers. To put it another way, why are so many foreign auto makers and suppliers doing well in the United States, while so many U.S.-based auto companies are not?

* * *
Despite public perception, the answer is not that foreign auto makers are more productive or offer better-quality or more fuel-efficient vehicles. In this year's Harbour Report, which measures manufacturing productivity, GM plants took three of the top five spots in North America, including first and second place. In the latest J.D. Power Initial Quality Study, GM's Buick and Cadillac ranked among the top five vehicle brands sold in America, ahead of nameplates like Toyota, Honda, Acura, Nissan, Infiniti and Mercedes-Benz. And GM offers more models that get over 30 miles per gallon (highway) than any other auto maker.

In fact, this kind of operating performance makes GM's recent financial performance all the more frustrating. The fact is, we're building the best cars and trucks we've ever built at GM, our products are receiving excellent reviews, and we're running the business in a globally competitive manner. Outside of North America, we're setting sales records. In fact, for the first time in our history, we will sell more cars and trucks this year outside the United States than inside, aided in no small part by our market-leading performance in China.

So why, fundamentally, are GM and the U.S. auto industry struggling right now?

Intense competition, for one. The global auto business grows tougher every year, and we accept that. Our ability to compete has made us the world's No. 1 auto maker for 74 consecutive years, and we're fighting hard to stay on top.

Beyond that, our performance in the marketplace has not been what we've wanted it to be. While we've been strong in truck sales, we've been weaker in cars, and, yes, the recent surge in gas prices hurt sales. While we've led in technologies like OnStar, we've lagged in others like hybrid vehicles. Rest assured, we're working hard to address the areas where we lag. Simply put, we are committed to doing a better job of designing, building and selling high-quality, high-value cars and trucks that consumers can't wait to buy. No excuses. We will step up our performance in this regard.

But competition and marketplace performance are not the whole story. To fully understand why GM and the U.S. auto industry are struggling right now, we have to understand some of the fundamental challenges facing American manufacturing in general -- challenges well beyond the control of any single company.

There are those who ask if manufacturing is still relevant for America. My view: You bet it is! Manufacturing generates two-thirds of America's R&D investment, accounts for three-fourths of our exports, and creates about 15 million American jobs. And the auto industry is a big part of that, accounting for 11% of American manufacturing, and nearly 4% of U.S. GDP. Together, GM, Ford and DaimlerChrysler invest more than $16 billion in research and development every year -- more than any other U.S. industry. And GM, alone, supports more than one million American jobs.

So what are the fundamental challenges facing American manufacturing? One is the spiraling cost of health care in the United States. Last year, GM spent $5.2 billion on health care for its U.S. employees, retirees and dependents -- a staggering $1,525 for every car and truck we produced. And the figure is going up again this year. Foreign auto makers have just a fraction of these costs, because they have few, if any, U.S. retirees, and in their home countries their governments fund a much greater portion of employee and retiree health-care costs.

Some argue that we have no one but ourselves to blame for our disproportionately high health-care "legacy costs." That kind of observation reminds me of the saying that no good deed going unpunished. That argument, while appealing to some, ignores the fact that American auto makers and other traditional manufacturing companies created a social contract with government and labor that raised America's standard of living and provided much of the economic growth of the 20th century. American manufacturers were once held up as good corporate citizens for providing these benefits. Today, we are maligned for our poor judgment in "giving away" such benefits 40 years ago.

Another factor beyond our control is lawsuit abuse. Litigation now costs the U.S. economy more than $245 billion a year, or more than $845 per person. That's more than 2% of our GDP. No other country has costs anywhere near this level. And the perverse thing is that, in many cases, the majority of courtroom settlements go to the lawyers and other litigation costs, not to the injured parties.

Another major concern is unfair trading practices, especially Japan's long-term initiatives to artificially weaken the yen. A leading Japanese auto maker reports that for each movement of one yen against the dollar, it gains 20 billion yen in additional profitability -- or nearly $170 million at today's exchange rate. No wonder Japanese auto makers have noted their recent record profits were aided by exchange rates. And no wonder the U.S. trade-balance deficit continues to grow by leaps and bounds.

There are other issues, of course, but my point is this: We at GM have a number of tough challenges that we must and will address on our own -- but we also carry some huge costs that our foreign competitors do not share.

Some say we're looking for a bailout. Baloney -- we at GM do not want a bailout. What we want -- after we take the actions we are taking, in product, technology, cost and every area we're working in our business today -- is the chance to compete on a level playing field. It's critical that government leaders, supported by business, unions and all our citizens, forge policy solutions to the issues undercutting American manufacturing competitiveness. We can do this. And we need to do it now.

Mr. Wagoner is chairman and CEO of the General Motors Corporation.

Well thanks for putting us all straight Mr Wagoner - GM is going out of business and it's everyone's fault except you and your management team. But don't worry - when they lock the gates in a couple of years, you'll still be sure to get your huge payoff before taking up a senior management position in another gullible company....:mad:

Well thanks for putting us all straight Mr Wagoner - GM is going out of business and it's everyone's fault except you and your management team. But don't worry - when they lock the gates in a couple of years, you'll still be sure to get your huge payoff before taking up a senior management position in another gullible company....:mad:

I love it.....:lmao:

How do you really feel? Please don't hold back, no reason to feel shy.

I understand where Mr. Wagoner is coming from and do agree with the issues he makes regarding "a level playing field", but I believe there are several major factors he conveniently ignores (or at least failed to mention).

Additional contributors to the demise of GM, Ford, and DCX sales/profitability include the fact that the average non-union American hourly worker in a Japanese (or Korean) automotive plant in the US is being paid approximately $10 - $12 an hour, whereas their unionized American auto worker in an American auto plant is making $25 - $27 an hour.

Add to this the fact that the Asian-based plant allows the employee the freedom to be a jack-of-all-trades (i.e. makes them responsible for many facets of the manufacturing process and the process of maintaining the equipment and facilities), whereas the US-based plant employee is limited by the Union contract to performing specific functions and then many times they get to wait on others to do their assigned task before they can do anything else.

I have witnessed with my own eyes Union hourly employees that will come to work, make rate in 4 hours, then set around for then next 4 hours, making "gravy" (in-fact I have witnessed floor supervisors encouraging this).

Then there is the whole issue of Executive pay:

According to Business Week Online – April 18, 2001: Spreading the Yankee Way of Pay

Japanese CEOs come out looking like paupers compared to their American counterparts. Pay for the big cheese at a Japanese firm ranges from $300,000 to $500,000 on average, says Hay Group's Tanaka, with bonuses averaging a measly 10%. In the U.S., by comparison, bonuses often eclipse base salary. And Japanese CEOs trail those in the U.S. by one other measure: Typically, they earn only about 10 times more than a manufacturing employee, according to a 2000 Towers Perrin survey that looked at industrial companies with about $500 million in annual sales. In the U.S., where the multiple is the highest in the world by far, CEOs of 365 top companies raked in 531 times more in 2000 than the average hourly worker did.

The Global Pay Gap (a table):

Nobody beats the U.S. when it comes to the difference in pay between CEOs and the average worker. On average, CEOs at 365 of the largest publicly traded U.S. companies earned $13.1 million last year, or 531 times what the typical hourly employee took home.

Around the rest of the world, Latin America is the leader in pay disparity, though even it doesn't come close to the U.S. At the other end of the spectrum, Japan has the smallest gap between CEO and average-worker pay.

The calculations below are based on on estimates by the consulting firm Towers Perrin as of Apr. 1, 2000. Average employees were assumed to be working in industrial companies with about $500 million in annual sales.

Country / CEO compensation as a multiple of average employee compensation

Brazil 57
Venezuela 54
South Africa 51
Argentina 48
Malaysia 47
Mexico 45
Hong Kong 38
Singapore 37
Britain 25
Thailand 23
Australia 22
Netherlands 22
Canada 21
China (Shanghai) 21
Belgium 19
Italy 19
Spain 18
New Zealand 16
France 16
Taiwan 15
Sweden 14
Germany 11
South Korea 11
Switzerland 11
Japan 10

When, and how, is Mr. Wagoner going to address these issues?

Here's the true substance of Rick Wagoner's statement. "It's critical that government leaders...forge policy...". All the rest, IMO is sawdust filler. Wagoner would make a pretty good political speech writer.

Anyway, he wants new 'government policy' to help offset the old 'government policy' that got us where we are today.

Quote "Some say we're looking for a bailout. Baloney -- we at GM do not want a bailout. What we want -- after we take the actions we are taking, in product, technology, cost and every area we're working in our business today -- is the chance to compete on a level playing field. It's critical that government leaders, supported by business, unions and all our citizens, forge policy solutions to the issues undercutting American manufacturing competitiveness. We can do this. And we need to do it now."
Mr. Wagoner is chairman and CEO of the General Motors Corporation.

" Level playing field"? Well this baloney too. Top management at the Big 3 have been saying this for over 20 years. So..questions is, "Why haven't they been proactive to change and improve their competitive position in all that time"?

what do you think?

what do you think?

You should buy, and I'll be happy to sell you some:lol: .

I have witnessed with my own eyes Union hourly employees that will come to work, make rate in 4 hours, then set around for then next 4 hours, making "gravy" (in-fact I have witnessed floor supervisors encouraging this).

I worked for GM for two years in the late eighties. I was told, in no uncertain terms, that once I made rate I was to stop working. I was reprimanded on several occasions for going over my rate, even though I could accomplish it in less than three hours. I was working midnight shift at the time, but I never had to sleep once I got home - I slept at the plant!

I agree, he should be a speech writer.

"Rest assured, we're working hard to address the areas where we lag. Simply put, we are committed to doing a better job of designing, building and selling high-quality, high-value cars and trucks that consumers can't wait to buy. No excuses. We will step up our performance in this regard."

Well, I can hardly wait. :singtome:

He makes no mention of customer satisfaction comparisons--Japanese cars have overall been on top since I can't remember when.

I sometimes wonder if those productivity measurements capture the offsetting costs of recalls and those various other pesky costs of poor quality. For example, the consumed time dealing with problems like Ford has done with its tires. White collar time is costly too, so I wonder how much of it is factored in productivity figures.

I'm sick to death of reading a complaint that litigation is out of control, when I have read how only a small portion of the hurt consumers file.

I agree the $1500(+/-)-per-car cost of health and retirement benefits is burdensome. Yet deciding to partially fund plans with stock investments was management's doing, perhaps in thinking the stock market would always be strong. Now it's not providing enough returns to keep pace, and government should correct some policy?

I agree the greatest tragedy will be that this guy and his team will collect their contracted compensation while the labor costs will be "corrected" through bankruptcy and closing plants. I continue to try recovering from my lost manufactruing job--it isn't easy to become someone else.

The dollar cost (we'll leave mental costs for another day) of becoming someone else is profound. $27 an hour is just over $56K a year. That sounds like a lot, but costs of living being as they are, such a salary frankly isn't unseemly when supporting a family of four. Comparing it to an overseas $10-$12 hourly salary is silly. My pay is in that range, and it's not exactly propping up the economy.

So our erstwhile Mr. Wagoner is not off my hook. Nope.

to a lack lustre range of products that aren't what customer really want? I read an interview with Mr. Robert Lutz, who you may remember was bought in by GM to help get the inspiration back into their vehicle designs. He reportedly said that GM was using some "innovative approaches". Like putting an ugly nose and butt on a 'late to the market' minivan and calling it something different?! Yeah, right!:biglaugh: When will GM Marketing and Engineering realize that badge engineering doesn't work? Putting a Chevy, Pontiac, Saturn, GMC, Saab, Buick, Isuzu, (Olds?) or other name on the same vehicle and telling us it's a new approach is just offensive to most folks. Not only have they screwed up domestic product, but they've debased the other marques they own, like Saab and Subaru etc.

At least Ford were somewhat careful to integrate the Lincoln LS platform under a Jag and so forth. Same with Chrysler's use of Mercedes components. GM just don't get it!

And then in Europe they have some kick-butt vehicles (relatively speaking) which have never made it over here. The new Pontiac Solstice is not a patch on the Mazda Miata and Opel/Vauxhall in Europe already had available to them a serious competitor. Now, the same Solstice is due in Europe but needs major ride and handling work, by Lotus, before it can be sold in that market!

When GM did bring over European cars, they were either really bad ones (like the Opel Astra) or the (better) Omega (Caddy Catera) at the wrong time in the market. The latest attempt, the Holden Monaro is good, but it's too limited in its market appeal. It's a real pity since I actually bought and preferred GM (Europe) products over anything else for a long while. The newer Astra's, Vectra's and Zafiras are all good vehicles which could be sold here. After all, most Kias, Hiyundai's, Toyota's, Hondas and so forth are in a similar size range.

Andy

I worked for GM for two years in the late eighties. I was told, in no uncertain terms, that once I made rate I was to stop working. I was reprimanded on several occasions for going over my rate, even though I could accomplish it in less than three hours. I was working midnight shift at the time, but I never had to sleep once I got home - I slept at the plant!

I had similar experience back in the late sixties/early seventies. I'm curious, who exactly told you, "in no uncertain terms, that once you made rate you were to stop working.

The union bosses, or GM management/supervision.

For me, it was company supervision/management.:eek:

I agree, he should be a speech writer.

"Rest assured, we're working hard to address the areas where we lag. Simply put, we are committed to doing a better job of designing, building and selling high-quality, high-value cars and trucks that consumers can't wait to buy. No excuses. We will step up our performance in this regard."

Well, I can hardly wait. :singtome:

He makes no mention of customer satisfaction comparisons--Japanese cars have overall been on top since I can't remember when.

I sometimes wonder if those productivity measurements capture the offsetting costs of recalls and those various other pesky costs of poor quality. For example, the consumed time dealing with problems like Ford has done with its tires. White collar time is costly too, so I wonder how much of it is factored in productivity figures.

I'm sick to death of reading a complaint that litigation is out of control, when I have read how only a small portion of the hurt consumers file.

I agree the $1500(+/-)-per-car cost of health and retirement benefits is burdensome. Yet deciding to partially fund plans with stock investments was management's doing, perhaps in thinking the stock market would always be strong. Now it's not providing enough returns to keep pace, and government should correct some policy?

I agree the greatest tragedy will be that this guy and his team will collect their contracted compensation while the labor costs will be "corrected" through bankruptcy and closing plants. I continue to try recovering from my lost manufactruing job--it isn't easy to become someone else.

The dollar cost (we'll leave mental costs for another day) of becoming someone else is profound. $27 an hour is just over $56K a year. That sounds like a lot, but costs of living being as they are, such a salary frankly isn't unseemly when supporting a family of four. Comparing it to an overseas $10-$12 hourly salary is silly. My pay is in that range, and it's not exactly propping up the economy.

So our erstwhile Mr. Wagoner is not off my hook. Nope.

Good points, each and every one of them, with one exception. I hope you are not truly sick unto death.

So our erstwhile Mr. Wagoner is not off my hook. Nope.
I'll bet that many of his employees wish that he really was erstwhile (http://www.bartleby.com/61/31/E0203100.html).;)

I had similar experience back in the late sixties/early seventies. I'm curious, who exactly told you, "in no uncertain terms, that once you made rate you were to stop working.

The union bosses, or GM management/supervision.

For me, it was company supervision/management.:eek:

Both. Supervision didn't want any squabbles with the union, and the union didn't want me to make other workers on the same job look bad. The simple fact was, the job was ridiculously easy, and the other workers were more interested in taking breaks than in working.

So am I. I get to take a break in about 2 weeks.

Both. Supervision didn't want any squabbles with the union, and the union didn't want me to make other workers on the same job look bad. The simple fact was, the job was ridiculously easy, and the other workers were more interested in taking breaks than in working.

Right! And look at what we face today...meltdown. Not that this, by any stretch of imagination or conspiracy theory ideas, could be the only cause.

not sure about the company as whole but i have this feeling that the stock will outperform dow....will see in 2yrs.....current price of gm is....$22.45 :)

I'll bet that many of his employees wish that he really was erstwhile (http://www.bartleby.com/61/31/E0203100.html).;)
Literally erstwhile, perhaps they are wishing. But I submit he is already a has-been, representing old-style management in a cut-throat world. His methods ("Oh oh oh! We will make more inspired and higher quality products now that we know we are clearly lagging!") represent the ruin of many firms who:

1. Thought they knew their customer but in the end showed myopic vision.

2. Clung to money-generating (such as stock market returns on gambled assets and "diversifying" with credit card divisions) schemes instead of refining a winning product and maintaining an image of excellence. (GM is just an example of the March of the Credit Divisions. The parade includes GE, my alma mater, ASQ...)

3. Blames the customer (litigation) and the employees (so sorry we can't afford to maintain our Social Contract with you) for its problems--superficial, short term thinking. Instead of saying "How dare you get old and needful" and "How dare you sue for damages that our faulty products and services inflict" he and his crew should instead apply some focus on qualitative matters.

I was going to say more, but I censored myself. :mad:

Jennifer,
I mostly agree with your first two points, but I would like to put a spin on #3.
How dare you get old and needful" and "How dare you sue for damages that our faulty products and services inflict
I believe there is some validity here. I do agree that it is short sighted and is closer to "save me from myself" but look at it this way.
How many people (working stiffs) are entitled to a pension? Most of us aren't unless we look out for ourselves. No one should expect anyone to take care of them for the rest of their life, it's no different than expecting Social Security to carry you through. Pay yourself & take care of your business first and everything else is a bonus.
Poor me the big bad business guy has taken all the handouts away and I didn't take care of myself, I didn't plan for my future. Dumb.

I, for one, can not believe that every lawsuit is justified. Yes, they should pay for faulty product but not for someones stupidity. I would like to see a Root Cause determined other than engineering issues. Could there be an assembly worker being to drunk or stoned to be working??? Was someone just to lazy to do their job???
As was stated in the old Tootsie Pop commecial "the world may never know".

Let’s take a SWAG at this on the back of an envelope. There are some 300 million people in this country, and 80% of them drive back and fourth to work every day. They buy a new car every 4 years worth an average cost of $25K. That means, in this country alone, the market is worth 1.5 trillion dollars PER YEAR.

I don’t want to hear your crap about unions, benefits, or health care costs. Every civilization in history has died of one of the seven deadly sins. GM died of greed. If you can’t make better long term plans, and share this obscene fortune with the people who made it for you, GOOD RIDDANCE!

They’re whining about an un-even playing field, while sitting in the running bulldozer that made it. Come’on, GM boys; why don’t you outsource another 50 thousand jobs! Then pay some senator 1MegaBuck to prevent imports of companies from the very same country.

Looks like the pot calling the kettle black to me.

I don’t know what we’re all upset about – There won’t be any gas soon anyway.

All good points Randy, but here's my position:

Regarding litigation:

Unquestionably there are frivolous lawsuits out there. However, the favored compensation cap "fix" does not approach this problem, in which time consumed from throwing out frivolous suits (Juries award high punitive awards in response to compelling evidence of corporate management behavior, not to frivolous suits) creates a legal system burden but is not being cited as the true drain on business. Multimillion dollar awards are cited as the burden.

About retirement:

When the workers whose pensions are now being questioned began work at their employers, a pension plan existed as policy. A rate of X dollars was placed into an account, some deducted from their paychecks, and the workers were assured that the pension would be there as a reward for their faithfully enriching the company. Now the executives say they can't afford to keep the retirement pay going, and point to the number of retirees as the cause. But if they are financial whizzes, why couldn't they make Devil's Advocate projections to go along with the rosy ones?

They failed to do the accurate, real-life math and it is true, health care costs far more than it should. (Certainly I think we should take a hard look at large scale solutions for that problem)

I disdain every pension plan that was "invested" in the stock market because the managers were so naive to believe the big returns would endure. They cannot endure at 90's levels. This short term thinking is resulting in long term misery.

Mr. Wagoner intones about the "entitlement mentality" to show the workforce is to blame for high costs. If bankrputcy ensues, I feel sure that Mr. Wagoner's compensation, including his contracted retirement pay will remain intact. But he is not discussing that in the press.

At current salaries, stock returns and living expense levels it is very difficult to save enough for a secure retirement. Existing workers with corporate sponsored plans should not be compelled to start afresh, and the U.S. government is nearing a crisis in taking up the defaulted plans. In accordance to my calculator (happy to share it if requested) young workers can resign themselves to living with family members for the rest of their lives. There is a bill in the works that compels 401K plans for every worker. I agree with the idea.

I also think it is sensible for families to reassemble generations in the same house versus try to maintain three times the housing costs so each can live "independently."

So what's to be done? Unquestionably the workers are going to be on their own. Personal choice and luck will both will rule their fates. I teach a night class to help them make the best decisions. When I grow old I expect to be living with some family member because I have no retirement at all, and I don't expect SS to be there when it's time to stop working. If not that, I expect I will be working until the last possible hour because I just won't be able to afford to stop.

Jennifer,
I mostly agree with your first two points, but I would like to put a spin on #3.

I believe there is some validity here. I do agree that it is short sighted and is closer to "save me from myself" but look at it this way.
How many people (working stiffs) are entitled to a pension? Most of us aren't unless we look out for ourselves. No one should expect anyone to take care of them for the rest of their life, it's no different than expecting Social Security to carry you through. Pay yourself & take care of your business first and everything else is a bonus.
Poor me the big bad business guy has taken all the handouts away and I didn't take care of myself, I didn't plan for my future. Dumb.

I, for one, can not believe that every lawsuit is justified. Yes, they should pay for faulty product but not for someones stupidity. I would like to see a Root Cause determined other than engineering issues. Could there be an assembly worker being to drunk or stoned to be working??? Was someone just to lazy to do their job???
As was stated in the old Tootsie Pop commecial "the world may never know".
The point about pensions was that GM entered into a CONTRACT with the workers. Now GM wants to unilaterally bow out of its end of the contract AFTER the employees have performed their part. (The argument that employees refused to work or actively pursued featherbedding is specious (pure hogwash) because management agreed to the work rules as part of the contract. Management is the entity that precluded workers from being cross-trained so they could lay off wholesale departments when the skill was no longer required, eliminating the need to integrate workers into other departments.)

What many miss in the apparent bitter conflict between management and labor is how symbiotic the relationship is - a sort of mutual parasitism where each side sucks a little blood from the other, always complaining how the other guy is a bloodsucker.

Sadly, the management side always seems to get the ear of media and thus of the public, to advance their agenda. The union guys (because they work across several primes and lower tiers) don't have the focus needed to attract press coverage.

:topic: How many of you out there think Mr. Wagoner wrote his speech without help? If you think he had help, how many would you estimate helped him? How many lawyers? How many PR guys? How many investment bankers to include stuff to pump up the stock so they can dump?

The point about pensions was that GM entered into a CONTRACT with the workers. Now GM wants to unilaterally bow out of its end of the contract AFTER the employees have performed their part. (The argument that employees refused to work or actively pursued featherbedding is specious (pure hogwash) because management agreed to the work rules as part of the contract. Management is the entity that precluded workers from being cross-trained so they could lay off wholesale departments when the skill was no longer required, eliminating the need to integrate workers into other departments.)

Yes:applause:. This is it in a nutshell. During all of those contract negotiations in the past, GM (and Ford, and DCX...) management made "business decisions" (a euphemism for "stupid and shortsighted ideas") that resulted in giving workers the right, and perhaps the obligation, to follow the path of least resistance. This was in lieu of exercising leadership, and the proverbial chickens have now come home to roost.

This just in from Reuters, via Yahoo
GM suspends 401(k) match for salaried employees 2 hours, 45 minutes ago



General Motors Corp. (NYSE:GM - news) is suspending contributions to its 401(k) retirement savings plan for salaried workers, a spokesman said on Thursday.

"We continue to monitor the business in determining when to reinstate the matching contributions," GM spokesman Robert Herta said.

The world's largest automaker was also dropping the requirement that up to 3 percent of worker's contributions and 100 percent of the automaker's contribution be invested in GM shares.

This was done to give employees more flexibility to choose their stocks and mutual funds, Herta said, adding that the changes take effect January 1.

GM now contributes 20 cents for each $1 that workers invest in the 401(k) plan up to 6 percent of an employee's base salary, Herta said. GM last year reduced its 401(k) match from 50 cents on the dollar to 20 cents.

GM's financial woes, combined with the bankruptcy filing of Delphi Corp., its biggest suppler, have taken a toll on its once-robust stock price. GM shares have fallen 44 percent this year.

GM, which has lost nearly $4 billion this year, is struggling with high health-care and commodity costs, loss of U.S. market share to foreign rivals and slumping sales of its once-profitable sport utility vehicles.

To compound matters, GM's borrowing costs have soared since its credit rating was first cut to junk status in May. Standard & Poor's cut GM's ratings deeper into junk territory this week.


If this applies to top management, there might be some justice but I suspect it will mainly impact engineers, mid-level and down managers, supervisors, etc. Folks earning a decent living, and planning on 401k and social security for retirement. I'd also forecast that a lot of salaried employees with short term tenure at GM will seriously consider a career/job change.

...If this applies to top management, there might be some justice .....

The top dogs get a pay raise, another 10% in their bonus (reward for saving $0.0001 on their share price.), and another 100,000 shares at option.

<Not a personal attack>
How many times do you (people of the world) have to see this to recognize this is corporate SOP.

It's greed! Investors need to see 10% growth, or they pull out. When you already have a market cap of 10 Billion or more, growth like that is smoke an mirrors (Anderson Accounting) - Un-sustainable.

What you are seeing is a scam; like "pump-n-dump" but on a planetary scale.
GM is headed for the honor roll with Enron, Tyco, and World Com.