Big Vehicle Shakeup Coming At GM?
Even as the heads of the (former) Big Three automakers and UAW president Ron Gettelfinger get ready to meet with House Speaker Nancy Pelosi (D-Calif.) and other lawmakers today at around 4 p.m., the former giant of all automakers -- GM -- is in such a fluid state, plans for its future are changing nearly from hour to hour.
The company's third-quarter earnings come out tomorrow and are widely predicted to be worse than expected. Some analysts expect the automaker will announce that it is burning through as much as $1 billion in cash per month, a staggering figure caused by plummeting vehicle sales combined with high legacy costs -- chiefly, the burden of paying benefits to the company's hundreds of thousands of retirees.
Some auto trade publications are reporting, based on unidentified GM sources, that the automaker has decided to postpone the launch of certain new vehicles and delay or kill plans to overhaul existing vehicles, as a way of saving money.
That may be so, but it's probably folly at this point to speculate which ones -- the situation inside GM is so fluid right now, decisions about certain vehicles could be made and scuttled within the same day.
What is certain: GM, Ford and Chrysler are asking Washington for an addition $25 billion in direct loans to help them retool factories to produce more fuel-efficient vehicles and, frankly, stay in business.
Pelosi is expected to make public comments at around 4:30 p.m. today. Check back here to see what she says.
-- Frank Ahrens
The Ticker is Twittering!
The comments to this entry are closed.