Nobody asked me, but . . .
More than a year ago, as I viewed GM’s “situation,” I only somewhat facetiously told colleagues that the best thing GM could do would be to simply shut down all its operations in the US and become the very thing that it considered its worst enemy: an importer. In many respects, the best products GM builds these days are based on engineering coming out of Korea (Daewoo for its small vehicles) and Germany (Opel for its midsize platforms). All of GM’s problems would “magically” go away if they went out of business in the US and simply became the new Toyota.
Of course this simplistic scenario ignores major issues such as the human side of legacy costs, pick slips for most of GM’s remaining workforce and the financial impact the demise of thousands of GM’s dealers will have on thousands of communities around the country. A GM bankruptcy will have a domino effect on automotive suppliers around the world. There will be numerous failures, which will impact the ability of other auto manufacturers, who rely upon these same suppliers, to continue building cars. Toyota is already planning ahead by stockpiling critical parts.
But in some ways that’s what a Chapter 11 will entail. GM’s original plan for survival was based on a sales volume that is probably a million units (I hate that word; it makes me think of retailing soap and cereal.) higher than what has been happening in the market for the past two months.
So now it’s back to the DC money pit for a larger handout. Doesn’t look or feel good. And Pontiac, Hummer, Saturn, Saab and Opel/Vauxhall are likely RIP. But we continue to shovel billions more into AIG’s coffers (coffins?).
Ain’t easy being either a car company CEO or a politician these days.