: Buying CTS-V with GM 's Bankruptcy Potential?



//ZZ//
11-17-08, 10:19 PM
Question: What are your thoughts about buying a new car (CTS-V) from a car company that has a potential for bankruptcy?

I'd love to buy a new CTS-V, my dealer has one ordered to my specifications and I have the first option (but no obligation) to buy or not.

All the talk about possible bankruptcy for GM, especially if a bailout is not offered (even if it is offered I'm not sure it is any long term fix), has me nervous. Although many suggest bankruptcy and restructuring under Chapter 11 may be one of the better options, if GM cannot qualify for DIP financing (debtor-in-possession), and some experts and some at GM feel they may not, then Chapter 7 and liquidation may be the only option and an end to GM. A recent survey of car buyers revealed 80% would never consider buying from a bankrupt automaker.

Although a guarantee of third party warranty coverage would be helpful, my real thought would be plummeted resale value should one ever wish to sell it. I'm hoping a great deal could be had, and keeping it long term may soften the depreciation blow. Even at that, I'm wondering about sitting tight for awhile and see what pans out. Some are speculating a bailout may not pass at present and they may push this out to the new administration. Not sure if GM will make it that long with cash depleted.

Am I alone being nervous about this? Wondering what some of your thoughts are on this matter.

Would you buy a car from an automaker that is or has a real potential to go bankrupt?

Thanks.

OzarksHillbilly
11-17-08, 10:31 PM
You're not alone in wondering/worrying about the possible effects of a GM bankruptcy, however unlikely that may be.

At the moment, I'm questioning the wisdom of the extended GM warranty I purchased this summer for my '05 V.

I remain hopeful that a solution to the financial crisis can be worked out that will keep GM in business. But in the meantime....

Art138
11-17-08, 10:59 PM
Quote"A recent survey of car buyers revealed 80% would never consider buying from a bankrupt automaker." I believe that depends on the manufacture; GM is on pretty solid ground overseas....I was just in Brazil and Mexico and albeit a slower market their market share is competitive. The main problem is in the U.S where the cost conversion is high partly due to past agreements with the unions. If it files for chapter 11 it will continue to produce only selected cars. If demand for the V is high enough then it will be made under a chapter 11 model. There will always be some outsourced arrangement to get the car service as a worst case scenario. I would buy it........

Cadillac Tony
11-17-08, 11:09 PM
We're getting asked these questions a lot at work right now. A LOT.

In my personal opinion, I don't see America letting GM go out of business- I just don't. Anyone except the most die hard anti-American-car people can see the ripple effect that GM tanking would have on the entire industry, let alone the American and world economy (yes- GM's business keeps a lot of foreign suppliers in business as well- it's not just American companies that would be affected). Aside from those shortsighted people, everyone including the Government knows what would happen, and it isn't pretty.

The shame of it all is that GM has been taking steps over the last few years to reduce its operating costs, streamline production and improve product, all with the goal of profitability by 2010. The plan was going great until the Casino - er, I mean- Wall Street, suffered this colossal meltdown that literally gutted the auto industry from the ground up. A lot of foolish people on blogs are crying "GM brought this on themselves", but the reality is that their restructuring was going quite well until this calamity hit.

I see no possible future that includes the Government standing idly by while our last great American industry burns to the ground (partially because of the sub-prime crisis caused by Washington lawmakers, not the automakers, I might add).

CIWS
11-17-08, 11:17 PM
The government will not allow GM or Ford to go out of business. They may sit back and allow Chapter 11, although I'm leaning toward that not happening at this time, but if they let them go completely under in the next couple of years the economic repercussions would be too dramatic. At that point anyone's warranty will be the last thing on our minds.

Jpjr
11-18-08, 12:02 AM
The government will not allow GM or Ford to go out of business. They may sit back and allow Chapter 11, although I'm leaning toward that not happening at this time, but if they let them go completely under in the next couple of years the economic repercussions would be too dramatic. At that point anyone's warranty will be the last thing on our minds.

I like how the governor of Alabama keeps going on TV saying the Big 3 should declare BK and fail. Strange coincidence that he has Japanese auto plants all over his state.

I also like how the rich execs on Wall Street are also pushing for a Big 3 BK, even as they take bailout TARP money from the government.

Lets hope Obama and Co. stick up for the American automakers and keep American autos and jobs in tact. A spade is a spade, GM would be out of business if the existing regime were sticking around.

Jpjr
11-18-08, 12:06 AM
You're not alone in wondering/worrying about the possible effects of a GM bankruptcy, however unlikely that may be.

At the moment, I'm questioning the wisdom of the extended GM warranty I purchased this summer for my '05 V.

I remain hopeful that a solution to the financial crisis can be worked out that will keep GM in business. But in the meantime....

My biggest concern with the V2 is not warranty (which would be guaranteed via BK).

My biggest concern is that CAFE shoots to 50mpg as a condition for bailout $$ and the V2 goes away. That would make parts very rare and expensive, especially since the LSA is not on any other vehicle yet and may never be.

cavemantrader
11-18-08, 12:28 AM
"The plan was going great until the Casino - er, I mean- Wall Street, suffered this colossal meltdown that literally gutted the auto industry from the ground up."

People who live in glass houses shouldn't throw stones!

GMAC has always been a big part of GM, and was frequently a larger contributor to the bottom line than the actual automobiles.

Ditech mortgage was a large part of GMAC during the housing boom times. Yep, GM caught the housing / mortgage boom, etc.

And maybe using 0% financing since October 2001 to force sales rather than reducing production was not the correct answer in the end. Did GM truly believe that a production rate of 16 or 17 million (for the U.S. market) was sustainable?

Am I impressed with the CTS-V and some of GM's other models. Sure, or I would not be here on this board. However, an unhappy ending might be unavoidable, whether it is now or 5 years down the road.

BaseBoy
11-18-08, 12:52 AM
The vast majority of V2 buyers are not purchasing V2s as a collector's item, but as a daily driver. Normally, one would expect problems with a new high performance car in the first model year. With the V2, there is a new powertrain and new electronics. Remember that many V1 rear differentials failed in the first year. Remember that oil pumps in the new E60 M5 failed. And there have been significant powertrain problems with new 911s. Thus, V2 owners very much need GM employees to be at work. They very much need suppliers to continue to supply parts.

There is one factor weighing in favor of the V2: It supposedly was built to handle the 500+ HP. Thus, if a driver does not spank a V2 repeatedly, the V2 should be expected to hold up well as a daily driver.

It is quite possible that V2 owners will have unusable bricks if a part fails for which there is no stock replacement. GM easily could shut down entirely for 3-9 months during a reorganization. Sure dealers would still repair cars -- for cash money -- as GM may not reimburse dealers for warranty repair during some period of a reorganization. (MPC went bankrupt recently, rendering my computer warranty worthless for the foreseeable future. No parts. No service. Only 1 person answering the phone.)

Consider too an unfortunate collision. Is there an existing supply of body parts to repair V2s? Does your insurance cover a rental for months on end? Does your insurance policy total a car for which there are no replacement parts?

What about recalls, such as the recent CTS airbag recall? What if GM is not around to recall V2s? or not around for 3-9 months during a reorganization?

Then there is resale value. Clearly the V2 is a phenomenal deal at $60k -- if it has a full powertrain warranty and a company standing behind the car during the warranty period. Without the company standing behind the V2, it is probably worth significantly less -- at least for those looking for daily driver instead of a collector's item. Compare with the new M3. Fully equipped at $70K, the M3 is more expensive than the V2. But one can be absolutely certain that the M3 will be repaired under warranty and will retain much of its value. Search cars.com for used M3s (or used M5s). If -- and that is a big "if" -- Cadillac planned on winning over potential M3, M5, etc. buyers, it should have a much more difficult time doing so when the fate of the company is in question. Why take a chance on having a brick? Why take a chance on a potential orphan?

Buy American. Yes, I never would have considered buying an import -- or even a Ford -- so long as GM was viable (and sending pension checks to family members). (Past CTS owner; current SRX owner.) But it is really asking a lot for us Buy American folks to take a chance on a new, expensive GM performance car given the current uncertainty. There is loyalty and then there is foolishness.

Uncle Meat
11-18-08, 06:20 AM
Personally I think that chapter 11 is the only way out for GM. If the government gives them a loan it's just putting off the inevitable. A couple billion $$ will what, keep them up and running for 6-9 more months? So you think GM is going to fix all their problems and become self-sustaining in just 6-9 months? Doubtful.

Filing for chapter 11 and dumping the unions is the only way that I see GM making it work. The reason the big three can't compete is because the unionized workforce adds too much $$ to the overall cost of our cars.

As for the OP's question... I wouldn't worry too much about it. Whether they get the hand out from Uncle Sam or the reorganize under chapter 11 I think you're safe.

U.M.

caddiedrummer
11-18-08, 09:04 AM
The problem is the same people who caused the problem are trying to fix. What did Harry Reid say yesterday something like we could fix (the car industry) overnight with the stroke of a pen . He is either deceitful, naive or both.

If you give GM or Ford $50 or $100 billion they will just burn through it. I hate to say it they either need to figure it out on their own or take 11. If you do it for them where does it stop and it becomes totally unfair. Also down the road any time GM is in crisis they will just firgure the tax payer will bail them out.

I will admit GM has tried and I like Wagoner (he went to our rival HS here in Richmond and played B-ball) But, the company has reacted too slowly and been way behind the quality curve. Just when it has almost caught up they are on the brink--true irony.

How about a 5% tax break for anyone buying a car before end of 08??

CIWS
11-18-08, 09:08 AM
There's already 25 billion set aside to give the Big 3 to help them develop and field alternative fuel / fuel efficient vehicles. Even if the initial vote this week is a No to tap the 700 Billion fund, there's a new Administration and Congress coming who's more sympathetic to them who could re vote the support after January or they could figure out a way to go ahead and fund them from the 25B already set aside. The point being they are far from gone, it's really just more of a question how it will occur and the form it will take. Odds are most owners won't keep their cars 5-6 years, and GM has at least that much life left in them between a possible Chp 11 and/or Uncle Sam's assistance.

CIWS
11-18-08, 09:18 AM
How about a 5% tax break for anyone buying a car before end of 08??

How about any "loan" to the big three comes with a stipulation that any actual taxpayer who filed a return and actually paid into the tax base can purchase ANY 1 automobile they sell at dealer invoice. Everyone still makes money, and the average joe taxpayer gets a good deal on one car they sell if done in the next three years. That gives enough time for those who just got into one to pay it down, finish most leases, and for the alternative fuel cars like the Volt to get to market.

Cadillac Tony
11-18-08, 09:58 AM
People who live in glass houses shouldn't throw stones!

GMAC has always been a big part of GM, and was frequently a larger contributor to the bottom line than the actual automobiles.

Ditech mortgage was a large part of GMAC during the housing boom times. Yep, GM caught the housing / mortgage boom, etc.

And maybe using 0% financing since October 2001 to force sales rather than reducing production was not the correct answer in the end. Did GM truly believe that a production rate of 16 or 17 million (for the U.S. market) was sustainable?

#1- I don't work for GMAC, so I don't live in that "glass house"

#2- The Government has been pressuring and requiring Mortgage companies to give loans to people who can't afford them since the Clinton Administration, so it's not like lenders just up and decided to do it. GM also sold 51% of GMAC in April 2006, during the height of the housing boom- perhaps they saw this coming?

#3- The American public and the Government should have been kissing GM's collective butt after September 11th when they came out with the "Keep America Rolling" program- 0% financing across the board. It was the first time an automaker had ever done something like it, and a large part of the reason we didn't dive into a recession in the weeks after 9/11. How much do you think it cost GM to do this? American buyers and the media returned the favor by continuing to buy foreign and lambaste GM at every chance they got.

Vrocks
11-18-08, 10:19 AM
We're getting asked these questions a lot at work right now. A LOT.

In my personal opinion, I don't see America letting GM go out of business- I just don't. Anyone except the most die hard anti-American-car people can see the ripple effect that GM tanking would have on the entire industry, let alone the American and world economy (yes- GM's business keeps a lot of foreign suppliers in business as well- it's not just American companies that would be affected). Aside from those shortsighted people, everyone including the Government knows what would happen, and it isn't pretty.

The shame of it all is that GM has been taking steps over the last few years to reduce its operating costs, streamline production and improve product, all with the goal of profitability by 2010. The plan was going great until the Casino - er, I mean- Wall Street, suffered this colossal meltdown that literally gutted the auto industry from the ground up. A lot of foolish people on blogs are crying "GM brought this on themselves", but the reality is that their restructuring was going quite well until this calamity hit.

I see no possible future that includes the Government standing idly by while our last great American industry burns to the ground (partially because of the sub-prime crisis caused by Washington lawmakers, not the automakers, I might add).

:thumbsup::thumbsup:

Vrocks
11-18-08, 10:24 AM
How about any "loan" to the big three comes with a stipulation that any actual taxpayer who filed a return and actually paid into the tax base can purchase ANY 1 automobile they sell at dealer invoice. Everyone still makes money, and the average joe taxpayer gets a good deal on one car they sell if done in the next three years. That gives enough time for those who just got into one to pay it down, finish most leases, and for the alternative fuel cars like the Volt to get to market.

That sounds good or something like this: offering tax incentives for buying American made cars (around $5,000).

demorgan59
11-18-08, 01:15 PM
[quote=caddiedrummer;1687316]He is either deceitful, naive or both.

That would be both.

Vrocks
11-18-08, 01:31 PM
The problem is the same people who caused the problem are trying to fix. What did Harry Reid say yesterday something like we could fix (the car industry) overnight with the stroke of a pen . He is either deceitful, naive or both.

If you give GM or Ford $50 or $100 billion they will just burn through it. I hate to say it they either need to figure it out on their own or take 11. If you do it for them where does it stop and it becomes totally unfair. Also down the road any time GM is in crisis they will just firgure the tax payer will bail them out.

I will admit GM has tried and I like Wagoner (he went to our rival HS here in Richmond and played B-ball) But, the company has reacted too slowly and been way behind the quality curve. Just when it has almost caught up they are on the brink--true irony.

How about a 5% tax break for anyone buying a car before end of 08??

The idiots running wallstreet and our banks are to blame for this, along with the federal gov, and people that took mortages they can't afford (and are now moving to Texas).

They couldn't turn things around with the UAW a whole lot faster than they did. The company is on target to post profits starting midway through 2010. They're getting screwed over by the credit crunch caused by poorly managed banks. GM is one company that I believe will actually be able to pay back a loan by 2015, unlike the shit bags Fannie, Freddie, AIG, etc... (of course they can't go under either).

New vehicles from GM have excellent quality, so I don't know what would bring you to say otherwise. Have you owned a BMW or Mercedes lately or have a friend with one? Heck even Toyota's transmissions and engines are total shit right now but they keep it quiet.

CH 11 would be nice in an ideal world but things are far from ideal right now.

Get your facts straight before you start spouting off, especially in a Cadillac forum.

caddiedrummer
11-18-08, 02:52 PM
The idiots running wallstreet and our banks are to blame for this, along with the federal gov, and people that took mortages they can't afford (and are now moving to Texas).

They couldn't turn things around with the UAW a whole lot faster than they did. The company is on target to post profits starting midway through 2010. They're getting screwed over by the credit crunch caused by poorly managed banks. GM is one company that I believe will actually be able to pay back a loan by 2015, unlike the shit bags Fannie, Freddie, AIG, etc... (of course they can't go under either).

New vehicles from GM have excellent quality, so I don't know what would bring you to say otherwise. Have you owned a BMW or Mercedes lately or have a friend with one? Heck even Toyota's transmissions and engines are total shit right now but they keep it quiet.

CH 11 would be nice in an ideal world but things are far from ideal right now.

Get your facts straight before you start spouting off, especially in a Cadillac forum.

Wow, Vrocks , take a deep breath. I actaully agree with your first 2 paragraghs. But as far as my facts, in the last 5 years, I have owned 2 Vettes, 4 Vipers, 7 Hondas (kids/wife) 2 Fords, and 4 Caddies including an XLR and XLR-V, as well as an 06 BMW M5. I can provide the dealer sevice sheets if you like, but my Hondas and Bimmer have been a lot less trouble free than the GM, Dodges and Fords.

Also, as I said if you were reading closely GM quality has gotten much better. I can buy almost any car I want and I would rather have a Caddy than a Bimmer or Mercedes. But, I am a realist. The M5 build quality, etc has been much better than my Caddies. I will still buy a Caddy.

A bailout ain't gonna help GM--just my opinion . It just puts off the inevitable. My family has owned Caddies since the late 30s so don't take umbrage--I am not a Euro snob--just the opposite.

Vrocks
11-18-08, 03:13 PM
Wow, Vrocks , take a deep breath. I actaully agree with your first 2 paragraghs. But as far as my facts, in the last 5 years, I have owned 2 Vettes, 4 Vipers, 7 Hondas (kids/wife) 2 Fords, and 4 Caddies including an XLR and XLR-V, as well as an 06 BMW M5. I can provide the dealer sevice sheets if you like, but my Hondas and Bimmer have been a lot less trouble free than the GM, Dodges and Fords.

Also, as I said if you were reading closely GM quality has gotten much better. I can buy almost any car I want and I would rather have a Caddy than a Bimmer or Mercedes. But, I am a realist. The M5 build quality, etc has been much better than my Caddies. I will still buy a Caddy.

A bailout ain't gonna help GM--just my opinion . It just puts off the inevitable. My family has owned Caddies since the late 30s so don't take umbrage--I am not a Euro snob--just the opposite.

Maybe your Hondas have been better (I'd take one over a Toyota any day) but every BMW experience I've had or a friend has had, was full of technical problems. Also, I wouldn't lump Dodge and Ford in with GM - then again maybe there's the odd chance that your GM vehicles had more problems than the other 2.

I was pissed when you said loaning them money is a waste. The fact of the matter is, GM (not sure about Ford or Chrysler) was on target to reduce union and pension costs. This would allow them to be profitable and to make even better cars than they can now.

I'd like to see them file ch 11 and re-structure with DIP financing and get another $25 billion to shore up the pension trust fund. The problem is, it doesn't look like that would happen in this environment, so a $25 billion loan buys time to get the 2010 plan online and then go from there.

There's no way the economy can take a GM CH11 hit, especially if it were to go south and turn into a CH 7... We're all reading the forecasts for 2009 and it's bad, yet those reports aren't planning on a GM collapse which would hammer other auto makers when suppliers go under as well.

Uncle Meat
11-18-08, 05:15 PM
I don't know guys... I'm really getting sick & tired of seeing my tax dollars being used to bail out others due to bad business practices.

U.M.

Cadillac Tony
11-18-08, 05:37 PM
For the last time people, GM is asking for LOANS, which they would pay back- not a bailout. No one seemed to care when the Government gave loans to the Airlines after 9/11, but I guess that's because you can't just drive up the street to a foreign airline after the American ones go out of business :rolleyes:

Incidentally- the Government backed loans for the airlines actually turned a $300M profit for the Government in less than two years. Giving a loan to the world's largest carmaker could actually turn out to be a great way for the Government to generate some funds to use toward other areas of the budget that need attention.

Wall Street journal Article HERE (http://online.wsj.com/article/SB114895120797865882.html?mod=todays_us_personal_j ournal)

cjwolverine
11-18-08, 06:08 PM
LOANS are great when people pay them back. Unpaid LOANS is what got us in this mess. What I gather many are saying is that Bankrupcy now without a loan saves a bad loan from happening. The fear is that the loan is given and bankruptcy happens anyway and the loan isn't paid back which is obviously worse than the loan never happening at all. I think we all know its a LOAN, the question is the ability to pay it back. Those who have posted against the bailout have fears that without major changes, GM can't pay it back. Yes they have made strides, but bandaids don't work on cancer.

Do you trust that the people running the show can turn it around? If so great. I for one live right down the road from Bob Lutz. I get to see him fly his fighter jet on joyrides over my house, over the golf course and all over Ann Arbor nearly every weekend in the summer. It probably costs $10k in jet fuel just to get it off the ground. Don't blame the fat cats on Wall Street. There are some pretty fat cats in Michigan on Jefferson Ave. who have run this company into the ground while they pad their wallets.

If they are burning 2.5 billion per month now, what indication do you have that they will stop burning it when it's in the form of a loan? Don't fill lots full of cars people are not buying and then tug on our heart strings to do the right thing and buy American. Whether or not the quality is there (we can debate that forever), they are making too many. Supply and Demand is the easiest equation around and yet the largest company in the world can't get a handle on it. We either don't want to buy your cars, can't afford to buy your cars, or want to buy your cars at a lower cost. Any way you slice it, you have made too many cars for us to absorb. Too many people are working at a wage far exceding the value they are adding to the car, and too many executives are flying in jets the company can't afford.

I agree the consequences would be terrible, but the excess finally caught up with them. If the union was dissolved and people rehired at a reasonable wage and were accountable for their actions they may have a chance. So can they pay the loan back? That's the real question.

Sorry for the long post. I'm still hear to learn about the V. I hope things look better next year. I'm a little afraid to buy one till some of these questions are answered.

No disrespect intended Tony, I'm just adding to the debate. I don't have enough info to guess what may happen. I can only watch and see how it plays out. I hope they are around. I hope it works out. And I hope to have V in my driveway when the snow melts in Michigan next spring.

cj

erp2863
11-18-08, 08:50 PM
Too many people are working at a wage far exceding the value they are adding to the car, and too many executives are flying in jets the company can't afford.

cj

I love that line.

I see Chapter 11, selling/killing brands/models at all NA plants except the ones making the Silverado, Corvette and soon to be Volt, re-negotiating the union contracts with the remaining employees, and concentrating on operations in China, South America, and Europe. I'd also be lobbying for the franchise laws to be repealed to enable direct sales.

At least this is what I would do....

MSOsr
11-18-08, 09:49 PM
Think about what the fair tax could do for GM. If GM weren't saddled with FICA, income taxes and other taxes (for their employees and suppliers) to stick into its cost of production, how attractive would its cars be overseas? If union workers received paychecks equal to the gross amount of their salaries/hourly pay, couldn't they provide more for their own retirements?

The US having the 2d highest corporate income tax in the world certainly affects our companies' competitiveness and contributes to companies moving overseas. Removing the corporate income tax for a year or two would do wonders for GM, even if it only assists its suppliers.

Mike

daytripper
11-18-08, 09:53 PM
Supply and Demand is the easiest equation around and yet the largest company in the world can't get a handle on it. We either don't want to buy your cars, can't afford to buy your cars, or want to buy your cars at a lower cost. Any way you slice it, you have made too many cars for us to absorb. Too many people are working at a wage far exceding the value they are adding to the car, and too many executives are flying in jets the company can't afford.

cj

You forgot one thing, and that's low resale value for existing customers. Many folks would love to be customer, but the past practices at the domestics (fire sales, overproduction, strikes, perceived quality, or whatever else) have done major damage to GM's resale values. How many times can folks step up to the window to buy when resale of what they have is 30-40% of MSRP in 3-4 years. I'd guess cash buyers and those not upside down in loans have a hard time eating that after a couple of cars. That may be ok for cars that cost $15k, but even fat cats stomachs must wrench when they sign for a $70k car thinking by the time they trade it they may get $30k.

Not to say GM is alone in this boat, as plenty of other high to mid-end cars resales have tanked recently. Leasing was one way to gloss this over, but leasing has lost its luster as well. Now tack on higher financing costs (if you can get financing), and the days where high end cars could be had for those who aren't fat cats (cash in hand) seen to be fading fast.

These kinds of worries were on peoples' minds before the media blitz on the potential demise of GM. Its no wonder that folks answer negatively to surveys about bankruptcy and car buying/value.

I myself really want a V again, but $10,000 a year depreciation + financing has me concerned. I realize this is no XLR-V, but some folks clearly lost more than their shirts on that car. While plenty of folks probably already like the buzz around this car enough to pick it over an M3, I wonder how many think its resale will hold up as well (outside of this board, of course).
I'm sure more than a few guys on here want it now, but are waiting it out to see the answers to many of the questions being raised. For those keeping it forever, I guess its not a problem, but how many guys said they were keeping their last CTS-V forever, I'd guess quite a few have changed their tune (as folks always do).

Brian R.

Mixdoctor
11-18-08, 10:01 PM
I see a bankrupt GM as a dead GM.They are having a hard enough time with sales now, but very few people are willing to buy a 20K or especially a 60K car, from a company that will not be there to service it down the road or where the potential resale value will be nil. If the big 3 go down our recession could turn into a depression.

CIWS
11-18-08, 10:13 PM
If the big 3 go down our recession could turn into a depression.

If the Big 3 go out in the next couple of years we will definitely hit a depression, one that will be worse than the 30s.

Vrocks
11-19-08, 01:19 AM
If the Big 3 go out in the next couple of years we will definitely hit a depression, one that will be worse than the 30s.

I agree, if we let them go under we're totally screwed forever. More money goes overseas to the foreign owned auto companies, no control over our dependence on foreign oil, fewer plants to build military equipment if there's a major war, the pension and health care costs aren't going away... they'll simply be an additional tax burden.

In addition to that; around 3 million jobs are lost in the US (I don't know how many around the world). The government will lose tax collection on $400 billion in annual wages, they'll have to bail out states that already can't afford to pay unemployment... the list goes on and on. To not provide a loan would be insane, and the words "mutually assured destruction" come to mind when I think about it.

Our national debt is expected to rise by approximately $2 trillion over the next year or so. The last thing we need to do is to kill off a future source of jobs and revenue and become more dependent on other countries. Yes, GM, Ford and Chrysler need to restructure but we can't afford to lose them.

mgscustomtune
11-19-08, 01:41 AM
The problem to me is three factors 1) Economic Meltdown
2) People buying foreign cars just because they are assembled in the USA
3) American Auto Makers can not export cars while other country's can import
But l would still buy a new 09 V

LITTLEELVISDAN
11-19-08, 09:13 AM
GET RID OF THE UNION... Then they can become competitive.... End of problem... File chapter 11, renegotiate all contracts, DO NOT RE-NEGOTIATE WITH THE UNIONS. Lots of skilled labor out there looking for work...... At least that's what I hear on the news.... lots of auto workers out of work... I bet they will come to work without a union contract...

LITTLEELVISDAN
11-19-08, 09:15 AM
GOD, I HATE THE UNION!!!! Its driving work overseas

CIWS
11-19-08, 09:38 AM
Yeah but what about the Unions ?













:D

dieselp
11-19-08, 09:58 AM
yea unions are horrible they give workers job security, horrible they dont let companys push around workers, horrible they let the worker earn a wage they can live well on you know nice house, cars, send there kids to college you know waht ever one wants i know horrible. yes i do beleave the unions do need some revamping but ther are worse thing out there.

Uncle Meat
11-19-08, 10:03 AM
yea unions are horrible they give workers job security, horrible they dont let companys push around workers, horrible they let the worker earn a wage they can live well on you know nice house, cars, send there kids to college you know waht ever one wants i know horrible. yes i do beleave the unions do need some revamping but ther are worse thing out there.Yeah, 30 years ago that was true. They are unecessary these days IMHO. The labor laws have come a long way over the past 50 years.

U.M.

LITTLEELVISDAN
11-19-08, 10:59 AM
yea unions are horrible they give workers job security, horrible they dont let companys push around workers, horrible they let the worker earn a wage they can live well on you know nice house, cars, send there kids to college you know waht ever one wants i know horrible. yes i do beleave the unions do need some revamping but ther are worse thing out there.It's the Union's 10 billion dollar pension GM is having trouble paying. The union won't back off its contracts so it looks like its going to be the union that kills GM. Ultimately all the workers they say they support will be JOBLESS. How does that make any sense? The airline union bankrupt the airlines (Delta) until they decided to back off their contract.

I just don't get putting a business out of business just to say you are for the worker. I'll take the work thank you..

All it does in the end is inflate the cost of doing business. and ultimately raises the price of the goods.

And that "job security" thing. All that is for now is so a company can't be efficient. They can't get rid of dead wood like they should. That is the biggest problem now days. A company gets too fat because they have to carry hundreds if not thousands of workers that are inept or have learned they are protected and don't have to produce. Thus leaving companies to hire more people who want to do some work. UNTILL the new guy gets beat down (by existing workers) for working too fast and making it look like everyone else is working slow. Then the new worker slows down to "conform". Thus the cycle starts all over.

GM could do with a big house cleaning but can't....

I know, I have been on both sides of the fence.....

Mixdoctor
11-19-08, 11:01 AM
GET RID OF THE UNION... Then they can become competitive.... End of problem... File chapter 11, renegotiate all contracts, DO NOT RE-NEGOTIATE WITH THE UNIONS. Lots of skilled labor out there looking for work...... At least that's what I hear on the news.... lots of auto workers out of work... I bet they will come to work without a union contract...


Would you continue to buy a car from a company in chapter 11? A company which will find it hard to get financing, especially in this economy ? It might be hard to find parts too as they might not be able to pay their suppliers. Also the resale value of your 65K V will be junk, especially if GM doesn't make it.

Few companies make it back from bankruptcy, one of the reasons is that consumer confidence is eroded in that company. Cars are a major purchase and you have to believe that the company that you bought yours from will be there to stand behind that car.

LITTLEELVISDAN
11-19-08, 11:42 AM
Would you continue to buy a car from a company in chapter 11? A company which will find it hard to get financing, especially in this economy ? It might be hard to find parts too as they might not be able to pay their suppliers. Also the resale value of your 65K V will be junk, especially if GM doesn't make it.

Few companies make it back from bankruptcy, one of the reasons is that consumer confidence is eroded in that company. Cars are a major purchase and you have to believe that the company that you bought yours from will be there to stand behind that car.I fly an airlines that went bankrupt... I think a failure in the sky is more deadly than a failure in a car on the ground. One just stops moving the other starts moving faster UNTIL it hits the GROUND.

Yes I would still buy a ZR1, or CTS-V or Z06 or Escallade if GM files chapter 11.
Even more so if they completely go bally up. What better car to have, the crown jewl, once they stop making them.

Mixdoctor
11-19-08, 12:04 PM
With airlines you are only buying a ticket and hope they are around long enough to fly you to you destination and back. With a car company you are buying a long term product that you hope can be serviced properly for the life of your ownership. I guarantee sales will fall off big time if people lose confidence in that happening, enough so that the car company can never recover.

jimthrall
11-19-08, 12:43 PM
I don't hear anyone questioning that the 2009 CTS-V is the best performance sedan out there. So if GM were to go out of business, wouldn't this be one of the rarest vehicles of all time and command a price far above list price? I am one of over 300,000 dealership employees in this country that hopes and prays that GM weathers this storm, in fact I am sure they will. However, if I am wrong the few of you that own these vehicles will be sitting on a gold mine!

Jpjr
11-20-08, 12:40 AM
I don't hear anyone questioning that the 2009 CTS-V is the best performance sedan out there. So if GM were to go out of business, wouldn't this be one of the rarest vehicles of all time and command a price far above list price? I am one of over 300,000 dealership employees in this country that hopes and prays that GM weathers this storm, in fact I am sure they will. However, if I am wrong the few of you that own these vehicles will be sitting on a gold mine!

Sorry in advance, but I think this analysis is wrong. There is nothing special about the V2 or ZR1 in the grand scheme of things. They are great cars relative to their class but if GM went BK they would end up as low volume cars with high cost parts and zero aftermarket.

I live in a region where people despise the American automakers. I've spent a lot of time thinking about why people hate them so much. It almost always seems like perception. The press pulls peoples emotional strings and convinces them that their own soverign manufacturing companies and employees are the enemy.

This is gut check time people. The Japanese government supports their companies, it is time to stand up and be counted or start heading to the rice boards.

I support the Big 3.

MacOSR
11-20-08, 08:47 AM
I live in a region where people despise the American automakers. I've spent a lot of time thinking about why people hate them so much. It almost always seems like perception. The press pulls peoples emotional strings and convinces them that their own soverign manufacturing companies and employees are the enemy.

This is gut check time people. The Japanese government supports their companies, it is time to stand up and be counted or start heading to the rice boards.

I support the Big 3.

I was 100% american when it came to cars until three years ago. I would buy two new american cars every two to three years. I got tired of all the warranty problems that GM or Ford would try and deny. It just got really old. This is why I went to Toyota and BMW.

In regards to the bail out. I do not agree and I do agree. If we just give them money then we are fools because it will not change anything. The unions have bankrupt the auto industry. This statement may not go well here. However, what company can support $7 billion in retiree health care?

When times are good and you are loosing money maybe something is way wrong!

Jpjr
11-20-08, 03:37 PM
I was 100% american when it came to cars until three years ago. I would buy two new american cars every two to three years. I got tired of all the warranty problems that GM or Ford would try and deny. It just got really old. This is why I went to Toyota and BMW.

In regards to the bail out. I do not agree and I do agree. If we just give them money then we are fools because it will not change anything. The unions have bankrupt the auto industry. This statement may not go well here. However, what company can support $7 billion in retiree health care?

When times are good and you are loosing money maybe something is way wrong!

Good comments. I have nothing against foreign name plates. The facts are facts, Japanese and German automakers build outsanding cars and no one should be told how or where to spend their money.

What I don't like is people not only passing on giving American cars a chance, but openly promoting their demise. It is almost like some people in this country are rooting for these American companies to go under. Yes, they have been at times poorly run and yes the union labor needs to get in line with market, but that does not mean you take joy in watching these people suffer. If you really think they have it good, take a trip to me to Detroit sometime. Things always look better on paper.

GM and Ford are now building great cars and the trend is up. They have very competitive products and have both gone global. They just need some help, no more than their competitors get from their citizens and government.

The Tony Show
11-20-08, 05:08 PM
They've reached a tentative deal. GM, Ford and Chrysler need to provide plans to show Congress how they will turn the companies around with the loans before it's officially voted on in December.

CASEY122457
11-20-08, 05:55 PM
They've reached a tentative deal. GM, Ford and Chrysler need to provide plans to show Congress how they will turn the companies around with the loans before it's officially voted on in December.

Showing Congress a plan does not mean it will be passed. UAW needs a dose of reality.

concorso
11-20-08, 07:16 PM
Sorry in advance, but I think this analysis is wrong. There is nothing special about the V2 or ZR1 in the grand scheme of things. They are great cars relative to their class but if GM went BK they would end up as low volume cars with high cost parts and zero aftermarket.

I live in a region where people despise the American automakers. I've spent a lot of time thinking about why people hate them so much. It almost always seems like perception. The press pulls peoples emotional strings and convinces them that their own soverign manufacturing companies and employees are the enemy.

This is gut check time people. The Japanese government supports their companies, it is time to stand up and be counted or start heading to the rice boards.

I support the Big 3.
The V2 and ZR1 are really insignicant, yup. Sad, but true. If cuting production of both cars would speed up the production of the Chevy Cruze, Id be all for it. GM needs smaller successful cars, not niche market cars.


But yes, I agree that perception has alot to do with it. GM has been making good cars again for 5+ years, but the public hasnt given them the chance to succeed again by buying cars. I havent nothing against people buying foreign cars, Ive bought a few myself. The problem I have is when they justify the purchase by saying the amercian equivalent is crap, when its often not. Right now alot of GM's vehicles are as good as anything else in the class.

JEM
11-21-08, 05:01 AM
GM has been building a number of exceptionally good vehicles, but not enough to support all their divisions and all their dealers. They pulled the plug on Oldsmobile; between Chevy and Cadillac you've got Buick, Pontiac, and Saturn where there's really room for one.

So what's a roadmap for a Chapter 11 filing? Especially when you've got an incoming Congress half of whom are in the UAW's pocket and the other half are crackpots like Henry Waxman?

greer
11-21-08, 12:46 PM
Ah timing, they say it is everything. So GM comes out with a great product the CTS-V which beats the Germans at there own game then the financial meltdown.

But something troubled me this week about the ceo's of the big three:

Are they kidding when they come to Washington hat in hand flying on private jets?

Thats like a college kid flying first class cross country asking his parents for a loan because he/she is broke.

This does not inspire confidence that leadership gets it, and maybe one of the mandates of a bailout should be that all new management be brought in.

I want the big 3 to make it, but when you look at their actions this week, I'm not so sure that it's possible.

4.9 Guy
11-21-08, 01:11 PM
Just spend your money wisely folks, if you can afford the new V, go for it. But if you're one to have champagne taste with beer income, I'd recommend you to keep your cash.

xwing1
11-22-08, 01:18 PM
I would CERTAINLY buy the beautiful CTSV-Coupe with 556hp motor when it came out, but now it is "delayed a year"...ugh.

I will therefore PROBABLY buy the CTS-V Sedan, but don't want the '4 door style' that much.

GM NEEDS to go bankrupt and re-emerge with a payscale for ALL its administration/employees that is on level with what the foreign car makers here in USA are doing. Otherwise we are throwing billions down a hole with no bottom.
GM will not "disappear" if they go through bankruptcy; they will re-emerge leaner, meaner and with a pay/pension situation that gives them a real chance of SUCCESS.

Our car companies CANNOT survive with average worker cost with benefits of over $75/hour, when foreign car companies here give $45/hour.
The Chrysler workers who get 95% of their pay when their plant CLOSES and they AREN'T working?!? I mean, [poop]...stop the INSANITY :)
The End.

Jpjr
11-22-08, 04:30 PM
GM NEEDS to go bankrupt and re-emerge with a payscale for ALL its administration/employees that is on level with what the foreign car makers here in USA are doing. Otherwise we are throwing billions down a hole with no bottom.
GM will not "disappear" if they go through bankruptcy; they will re-emerge leaner, meaner and with a pay/pension situation that gives them a real chance of SUCCESS.
.


This argument sounds great on paper. ;) I'm sure someone made it to Delphi.

I don't see how GM will not be liquidated to foreign manufactuers if they declare BK. I love GM as much as anyone, but I would never consider buying a car from a bk manufacturer. That is like buying an extended warranty from Circuit City when you could go right down the street to Best Buy.

GMBOUND
11-28-08, 08:57 PM
see link in sig

Sorentj
07-19-09, 03:26 PM
I look at it the other way - get one while you still can. I gues Obama will ban fun cars like the CTS-V.

vperl
07-19-09, 03:34 PM
Guess loads of folks still have not figured it out.

The niche, or specialty cars as some call them can draw attention to the rest of their line up.
The Corvette & V series are here to stay for several more years, doubters can go fish.

Buy American steel.

lemaman
07-19-09, 11:07 PM
The way I see it is this: GM disbanded their High Performance V team after this year's CTS V. That instantly makes it collectible in a way. Parts should still be available as most are common to all CTS lines. I suspect resell value will remain high and these cars are perhaps the best GMC product investment one can make now. I, like the previous poster, don't see an American Icon being allowed to dry up and blow away and get swallowed by some foreign investors. We've been through worse. Hell, if Lee Iaccoca could resurrect Chrysler, then anything is possible!

MReiland
07-19-09, 11:23 PM
The engineers on the performace teams still work at GM and can be called upon at any time to do enhanced performance versions of GM vehicles. They didn't go and fire them, just took away their title as a specialty performance group.