Brothers4TheStruggle
11-07-08, 01:13 PM
Could things get any worse for the big 3 Automakers here in the states??
http://www.leftlanenews.com/gm-posts-25b-loss-halts-trading-for-announcement.html
General Motors posted a $4.2 billion operating loss during the third quarter of 2008 - a far larger amount than had been expected by analysts - the automaker announced today. The automaker has suspended its talks over a possible merger with Chrysler and said that its cash liquidity for the rest of the year “will approach the minimum amount necessary” to continue to operate.
GM says that, despite the plans outlined in the presentation to employees this morning, its liquidity will fall significantly short of that minimum amount unless the industry’s conditions “significantly improve.”
GM’s financial situation
The Detroit automaker posted a third quarter net loss of $2.5 billion ($4.45/share), an improvement over the $42.5 billion loss from t GM says that its rate of burning through cash - previously about $1 billion a month - has doubled to $2.3 billion, or $6.9 billion total during the quarter.
The automaker says that it expects fourth quarter spending to be down significantly, however. Revenues for the third quarter were down $37.9 billion, well below analysts’ estimates before the announcement. GM says its operating cash is approaching the “minimum amount necessary to operate,” which puts the automaker near the edge of bankruptcy. The automaker has about $20 billion in cash but says that below $12 billion is its breaking point.
Short-term fixes
To temporarily improve its liquidity, GM is looking to boost capital by $5 billion by the end of the year and $20 billion by the end of 2009 by way of more job cuts, sale of assets and slashing capital spending by a further $2.5 billion. According to the presentation GM gave to its employees earlier today in Detroit, the automaker will cut spending in its media and sales promotions, reducing its dealer network restructuring activities, revising its production schedules, eliminating non-essential projects and, perhaps most importantly in the long run, reducing engineering spending.
More than $10 billion in internal operating actions to reduce spending have been completed or are on track for completion by the end of 2009.
GM confirmed that it would push back the Chevrolet Cruze, Cadillac CTS coupe, Saab 9-5 and Saab 9-4x to a 2010 calendar year introduction as 2011 models.
Chrysler merger talks over
The automaker announced that it has suspended talks with Chrysler LLC and Cerberus Capital Management LC over the proposed merger between the two automakers. GM says that it won’t look into a merger further until its immediate financial problems are fixed - so don’t expect many more GM/Chrysler rumors for a while.
U.S. Government bailout
GM again reiterated its desire for federal funding to help the Detroit auto industry, though CNBC analysts were mixed on how positive this outcome would be for the automaker and the industry as a whole.
“The U.S government’s actions to help stabilize the credit markets and eventually ease the credit crunch are an essential first step to the economy’s and the auto industry’s recovery but further strong action is required,” CEO Rick Wagoner said in a statement.
Ford post $2.7b third quarter loss..........
http://www.leftlanenews.com/ford-posts-27b-loss-in-third-quarter.html
Things are going from bad to worse in Detroit, with low consumer confidence and tight credit markets leading to the full on collapse of new car sales. Ford posted a $2.7 billion operating loss in the third quarter, prompting the Dearborn-based automaker to announce further production and job cuts.
In addition to posting a $2.7 billion operating loss in the third quarter, Ford also burned through $7.7 billion of its cash reserves, according to Automotive News. As of the end of September, Ford had $18.9 billion cash on hand, down from $26.6 billion three month earlier.
Ford’s automotive operations lost $2.9 billion before taxes in the third quarter, compared to a $362 million loss a year earlier.
Ford calculates that it still has an overall liquidity of nearly $30 billion, but with sales expected to continue to tank in 2009, the future isn’t looking bright.
“We continue to take fast and decisive action implementing our plan and responding to the rapidly changing business environment,” CEO Alan Mulally said in a statement on Friday. “We have a strategy that is broad and specific enough to handle the dramatic changes in today’s environment.”
In an attempt to at least slow its bleeding, Ford will cut 10 percent of its North American white collar workforce by the end of January. Another 2,600 hourly workers will be let go through a voluntary buyout package. In addition to job cuts, Ford will also remove 40,000 vehicles from its fourth quarter production schedules, with most cuts coming at car and crossover plants.
Ford hasn’t turned a profit since 2005 and doesn’t expect to return to profitability until at least 2010.
http://www.leftlanenews.com/gm-posts-25b-loss-halts-trading-for-announcement.html
General Motors posted a $4.2 billion operating loss during the third quarter of 2008 - a far larger amount than had been expected by analysts - the automaker announced today. The automaker has suspended its talks over a possible merger with Chrysler and said that its cash liquidity for the rest of the year “will approach the minimum amount necessary” to continue to operate.
GM says that, despite the plans outlined in the presentation to employees this morning, its liquidity will fall significantly short of that minimum amount unless the industry’s conditions “significantly improve.”
GM’s financial situation
The Detroit automaker posted a third quarter net loss of $2.5 billion ($4.45/share), an improvement over the $42.5 billion loss from t GM says that its rate of burning through cash - previously about $1 billion a month - has doubled to $2.3 billion, or $6.9 billion total during the quarter.
The automaker says that it expects fourth quarter spending to be down significantly, however. Revenues for the third quarter were down $37.9 billion, well below analysts’ estimates before the announcement. GM says its operating cash is approaching the “minimum amount necessary to operate,” which puts the automaker near the edge of bankruptcy. The automaker has about $20 billion in cash but says that below $12 billion is its breaking point.
Short-term fixes
To temporarily improve its liquidity, GM is looking to boost capital by $5 billion by the end of the year and $20 billion by the end of 2009 by way of more job cuts, sale of assets and slashing capital spending by a further $2.5 billion. According to the presentation GM gave to its employees earlier today in Detroit, the automaker will cut spending in its media and sales promotions, reducing its dealer network restructuring activities, revising its production schedules, eliminating non-essential projects and, perhaps most importantly in the long run, reducing engineering spending.
More than $10 billion in internal operating actions to reduce spending have been completed or are on track for completion by the end of 2009.
GM confirmed that it would push back the Chevrolet Cruze, Cadillac CTS coupe, Saab 9-5 and Saab 9-4x to a 2010 calendar year introduction as 2011 models.
Chrysler merger talks over
The automaker announced that it has suspended talks with Chrysler LLC and Cerberus Capital Management LC over the proposed merger between the two automakers. GM says that it won’t look into a merger further until its immediate financial problems are fixed - so don’t expect many more GM/Chrysler rumors for a while.
U.S. Government bailout
GM again reiterated its desire for federal funding to help the Detroit auto industry, though CNBC analysts were mixed on how positive this outcome would be for the automaker and the industry as a whole.
“The U.S government’s actions to help stabilize the credit markets and eventually ease the credit crunch are an essential first step to the economy’s and the auto industry’s recovery but further strong action is required,” CEO Rick Wagoner said in a statement.
Ford post $2.7b third quarter loss..........
http://www.leftlanenews.com/ford-posts-27b-loss-in-third-quarter.html
Things are going from bad to worse in Detroit, with low consumer confidence and tight credit markets leading to the full on collapse of new car sales. Ford posted a $2.7 billion operating loss in the third quarter, prompting the Dearborn-based automaker to announce further production and job cuts.
In addition to posting a $2.7 billion operating loss in the third quarter, Ford also burned through $7.7 billion of its cash reserves, according to Automotive News. As of the end of September, Ford had $18.9 billion cash on hand, down from $26.6 billion three month earlier.
Ford’s automotive operations lost $2.9 billion before taxes in the third quarter, compared to a $362 million loss a year earlier.
Ford calculates that it still has an overall liquidity of nearly $30 billion, but with sales expected to continue to tank in 2009, the future isn’t looking bright.
“We continue to take fast and decisive action implementing our plan and responding to the rapidly changing business environment,” CEO Alan Mulally said in a statement on Friday. “We have a strategy that is broad and specific enough to handle the dramatic changes in today’s environment.”
In an attempt to at least slow its bleeding, Ford will cut 10 percent of its North American white collar workforce by the end of January. Another 2,600 hourly workers will be let go through a voluntary buyout package. In addition to job cuts, Ford will also remove 40,000 vehicles from its fourth quarter production schedules, with most cuts coming at car and crossover plants.
Ford hasn’t turned a profit since 2005 and doesn’t expect to return to profitability until at least 2010.