auto workers' pension and benefits fund is on the line, and an early IPO is risky:the current GM CEO is leaving GM, mainly b/c he believes an early IPO is premature and ill-advised:New CEO for Revived GM .......Mr. Whitacre's departure, however, was announced as
some tension was building between the company and Washington, people familiar with the matter said.
The Obama administration would like GM to hold a stock offering soon, perhaps even before the midterm elections in November, while GM hasn't committed to such a timetable.
A GM IPO would likely give President Barack Obama grounds to claim that the bailouts of GM and Chrysler Group LLC are working, especially in key election races in the Republican-leaning states where skepticism of the bailout runs high.
The U.S. is expected to sell at least $10 billion of its shares in the company in an IPO, said a person familiar with the situation.
Last week Mr. Whitacre publicly expressed a preference for taking more time to prepare for a stock offering, and for having the government sell a major stake in the company so that GM can shed the image of being on government support.
Mr. Akerson, who has served as a managing director at the buyout firm Carlyle Group since July 2009, is known as a
decisive, hard-nosed and often unforgiving manager—qualities that appealed to members of the Obama administration's auto task force when they recruited him to join GM's board last summer......
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Its key North American unit had an operating profit of $2,177 on each vehicle it produced....
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http://online.wsj.com/article/SB10001424052748704407804575425043506377512.html?mod=WSJ_hpp_LEFTWhatsNewsCollection Obama Administration Assisting in Squeezing GM, Chrysler UAW workersBoth companies are trying to reduce their debt by two-thirds and convince the United Auto Workers union to accept shares of stock in exchange for half of the payments into a union-run trust fund for retiree health care costs. The loan agreement also called for executive pay cuts and labor costs that are competitive with Japanese automakers with U.S. operations.
In other words, going to almost Walmart wages for advanced manufacturing jobs.
Note, they refuse to even mention how GM has invested billions in offshore outsourcing jobs, selling cars in China for $1200 dollars or the reports on how previous bail out money went to their Brazil operations.
http://www.economicpopulist.org/content/obama-administration-assisting-squeezing-gm-chrysler-uaw-workers US sales are actually slow, mostly fleet sales; to boost sales in the US:
GM-AmeriCredit Deal: The Subprime Love Affair RekindledGovernment-owned General Motors is acquiring Fort Worth’s AmeriCredit in a $3.5 billion deal.
AmeriCredit gives GM something it sorely lacked: a lender that can reached car buyers of all stripes, including subprime borrowers, which constitute as much as 25% of the car-buying market.
Associated PressBuyers with shaky credit–or FICO scores of 300 to 600–are what AmeriCredit specializes in.
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http://blogs.wsj.com/deals/2010/07/22/gm-americredit-deal-americas-subprime-love-affair-rekindled/ the banksters will win, regardless of GM's share price at the IPO, and they are salivating:The Big Guns Coming Out for GM Deal Wall Street bankers are salivating over one of their biggest potential paydays since the market meltdown of 2008: the planned initial public offering of General Motors Co.
With a size that may top $10 billion, the GM IPO could generate fees of $275 million or more for the Wall Street underwriters, the most fees from a single stock deal since the $19.7 billion IPO of credit-card giant Visa in March 2008 generated $550 million.....
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http://online.wsj.com/article/SB10001424052748703630304575270892916644732.html?KEYWORDS=gm+mexico The Banks Behind G.M.’s $5 Billion LoanAs General Motors continues in its march toward an initial public offering, perhaps filing for one as soon as Friday,
the automaker has taken big steps to bolster its financial health as much as possible.
Among the biggest moves it has made is securing a $5 billion credit facility from 10 big banks to provide an additional cushion as it seeks to go public.
As you can see in the list after the jump, the lenders are the usual suspects — and they are each committing a relatively significant chunk of change to be part of the facility. And what has become increasingly clear is how integrated the loan is to G.M.’s stock offering plans.
The lead banks on the five-year facility are Citigroup and Bank of America, people briefed on the matter told DealBook on Thursday.
And the following are the other members of the initial consortium:
JPMorgan Chase
Morgan Stanley
Goldman Sachs
Credit Suisse
Barclays Capital
Deutsche Bank
UBS
Royal Bank of Canadasnip
While the loan itself bears fees that appear relatively high for this kind of facility, those charges help offset the slim fee that banks are charging to help manage G.M.’s offering, one of these people said. (Banks are charging about 0.75 percent for the offering, the people briefed on the matter said.)
Perhaps most important for the lenders, all have been promised a role in managing the G.M. offering, these people said.
http://dealbook.blogs.nytimes.com/2010/08/12/the-banks-behind-g-m-s-5-billion-loan/ auto workers' wages slashed, non-union plants in Michigan, outsourcing and offshoring:
GM Seeks to Cut Wages in Half at Indianapolis FactoryGM stamping plant workers in Indianapolis have told the company they won’t cut their wages in half, even when threatened with a shutdown. A prospective buyer of the 650-worker factory has indicated he wants United Auto Workers members to drop from $29 an hour to $14.65.
“If they were to succeed in cutting our wages here,” said shop chair Greg Clark, “they could easily just bring stamping work here, whipsaw us against the other facilities, and before you know it, the whole stamping division would be under siege.” Other GM stamping plants are in Parma, Ohio; Marion, Indiana; and Flint, Michigan.
Although UAW Local 23 members voted 384-22 in May against opening the contract, the UAW International is strongly backing the cuts, indicating that it may go around the local to talk to prospective buyer JD Norman Industries of Illinois. But Clark says, “If you need a wage cut before you even begin, this is not the business you need to be in. Maybe you should try something else.”
Many of the Indianapolis workers are “GM gypsies” who have been forced to transfer from plant to plant during their careers. Clark, for example, is on his fifth factory and third plant closing.
http://www.labornotes.org/2010/07/gm-seeks-cut-wages-half-indianapolis-factory GM’s Battery Plant Opens Non-Union The opening of GM’s lithium-ion battery plant near Detroit signals the company’s turn to electric vehicles and to non-union production.
The “reinvention” of the “New GM” began with the opening of a lithium-ion battery plant in Brownstown, Michigan, near Detroit. The event not only signals GM’s return to electric vehicles—for the first time in about 30 years, GM has opened a non-union plant in the U.S.
The new plant is funded in part by taxpayer dollars, and it is not rehiring any of the thousands of United Auto Workers members who were laid off when their plants closed—despite union promises that workers’ concessions on pay, benefits, and speed of work were their only chance for job security.
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http://www.labornotes.org/2010/03/gm%E2%80%99s-battery-plant-opens-non-union GM offshore outsourcing U.S. jobsGeneral Motors Corp. will shift more production of vehicles bound for the U.S. market to China, Mexico, South Korea and Japan, but will keep total imports at roughly one-third of all sales here.
In a confidential 12-page presentation to members of Congress, obtained by The Detroit News on Friday, GM said it will boost U.S. sales of vehicles built in those four countries by 98 percent -- or about 365,000 vehicles -- while shrinking production in Canada, Australia and European countries by about 130,000 vehicles.
GM also disclosed it will start importing vehicles made in China in 2011, reaching 51,546 vehicles in 2014. Imports from South Korea to the United States will jump from 36,967 vehicles in 2010 to 157,126 in 2014.
The automaker said it is canceling expansion projects in Russia, India and Mexico.
GM's plan to import more vehicles from low-wage countries raises questions about whether it should beef up its foreign operations as it is relying on federal money to stay afloat. It also puts the automaker at odds with the United Auto Workers, which is trying to protect U.S. jobs amid a dramatic restructuring of the domestic auto industry.
http://www.economicpopulist.org/content/gm-offshore-outsourcing-us-jobs GM Posts $1.3 Billion ProfitGM said Thursday that it made $1.3 billion from April through June, its second straight quarter in the black and a complete reversal from last year, when it was forced into bankruptcy and the U.S. government took a majority stake.
http://news.yahoo.com/s/ap/us_earns_gm pragmatic UAW incoming president, Bob King, capitulates:
A UAW for the 21st centuryUAW President Bob King's speech to the Center for Automotive Research Conference
Delivered to Center for Automotive Research Conference, Aug. 2, 2010
........Everyone made enormous sacrifices to emerge from this crisis. UAW members took wage cuts of $7,000 to $30,000 a year. Benefits were also reduced significantly. Restructuring resulted in the loss of nearly 200,000 jobs.....
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The UAW of the 21st century must be fundamentally and radically different from the UAW of the 20th century....
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The 21st-century UAW recognizes that flexibility, innovation, lean manufacturing and continuous cost improvement are paramount in the global marketplace.....
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The 21st-century UAW no longer views these managements as our adversaries or enemies, but as partners in innovation and quality. Our new relationships with these employers are built upon a foundation of respect, shared goals, and a common mission....
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http://www.uaw.org/articles/uaw-21st-century
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