Autoblog

Report: GM, Opel agree to restructuring, clearing the way for German loans

Jonathon Ramsey — Mon, 24 May 2010 09:31:00 EST

Filed under: Europe, Government/Legal, GM, Earnings/Financials, Opel

To the German government authorities who think General Motors is financially sound enough to pay for Opel's restructuring without loan-guarantee assistance, Opel CEO Nick Reilly says that's not the case. "You need to remember that GM is first of all founded by U.S. taxpayers," Reilly was quoted as saying. "Frankly, GM needs the money it has got."

Not surprisingly, GM has found an ally in Opel's German workers. The General has come to an agreement with the local labor heads who have agreed to forgo €1.26 billion ($1.586B U.S.) in earnings over the next four years. The deal requires that the money 'saved' be committed to developing Opel products, and if it isn't, then GM has to pay it back.

To help everyone keep track of the money and perhaps make financial assistance a more attractive option, Adam Opel AG will become a listed company. Germany hasn't given any indication of when it will declare its position on giving aid, but with 24,000 workers added to the plea and everyone unsure of how long GM can wait before it needs to take other measures, Germany will probably want to close this chapter out rather soon.

[Source: The Associated Press via Google]

Report: GM, Opel agree to restructuring, clearing the way for German loans originally appeared on Autoblog on Mon, 24 May 2010 09:31:00 EST. Please see our terms for use of feeds.

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German lawmakers said to oppose Opel loans, argue GM is healthy enough on its own

Jonathon Ramsey — Thu, 20 May 2010 18:20:00 EST

Filed under: Europe, Government/Legal, Plants/Manufacturing, GM, Earnings/Financials, Opel

General Motors isn't finished with Opel, but the German government would apparently like to be finished with General Motors. Michael Fuchs, a senior member in Angela Merkel's ruling CDU party, has reportedly declared "The discussion ... about financial aid for Opel must be ended once and for all."

This is the same Fuchs that a year ago didn't want to consider giving any money to GM before The General tried to sell Opel because he felt that the money might end up supporting GM's American operations. Now, his reasons against are because of the rise in GM's financial fortunes - trumpeting the paying off of loans (kind of), potential bank acquisitions and recent quarterly profits can have an adverse effect on loans. Germany has also been playing the role of Europe's financial guarantor as of late and is tired of being seen as a euro trough.

Opel CEO Nick Reilly says he's still waiting on word from Germany and a few other governments about aid for Opel. If GM doesn't get the $3 billion it seeks to restructure the company as it, we're guessing it will channel its inner David Copperfield and show a few countries how to make a factory and thousands of jobs disappear. The bell has rung on the next round in the saga.

[Source: The Wall Street Journal]

German lawmakers said to oppose Opel loans, argue GM is healthy enough on its own originally appeared on Autoblog on Thu, 20 May 2010 18:20:00 EST. Please see our terms for use of feeds.

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Treasury reportedly says GM properly used escrow to repay loans

Zach Bowman — Thu, 29 Apr 2010 10:00:00 EST

Filed under: Government/Legal, GM, Earnings/Financials

General Motors didn't use another government loan to pay off the much-celebrated $4.7 billion portion of its federal debt. According to a spokesperson with the Treasury Department cited by Bloomberg, the Detroit-based carmaker properly used funds from an escrow account to do the deed. The funds were available for the automaker to use in the event that it ran across any extraordinary expenses, but since the manufacturer decided it didn't need the money, it paid it back.

Despite the fanfare surrounding GM's repayment of a portion of its federal loans, some critics accused the company of using other government money for the payoff. Specifically, Senator Charles Grassley, the top Republican on the Senate Finance Committee, accused the automaker of performing a "TARP money shuffle" as a public relations stunt. Treasury Assistant Secretary for Financial Stability Herbert M. Allison disputed Grassley's claim in a letter on Tuesday.

[Source: Bloomberg]

Treasury reportedly says GM properly used escrow to repay loans originally appeared on Autoblog on Thu, 29 Apr 2010 10:00:00 EST. Please see our terms for use of feeds.

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Autoblog Podcast #176 - Beijing, Bailout and Bucks (profits, that is)

Dan Roth — Tue, 27 Apr 2010 16:20:00 EST

Filed under: Podcasts, Government/Legal, BMW, Ford, GM, Kia, Lincoln, Earnings/Financials, Beijing Motor Show

Click above for the Autoblog Podcast in iTunes, RSS or listen now!

Chris Shunk, Dan Roth, Chris Paukert and Jonny Lieberman mull over what we just saw at the Beijing Motor Show, the general public's changing opinion of which nations make quality automobiles, General Motors' loan repayment, and Kia's profits. Of course there's the Autoblog Garage and your questions bookending those topics, and we're done at the hour and sixteen minute mark. See you next week!

Autoblog Podcast #176: Beijing, Bailout and Bucks

In the Autoblog Garage:

Long-term Subaru Legacy 2.5GT
BMW X5M
Lincoln MKT

Hosts:
Chris Shunk, Chris Paukert, Dan Roth, Jonny Lieberman

Runtime: 1:13:46

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Feedback:
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Autoblog Podcast #176 - Beijing, Bailout and Bucks (profits, that is) originally appeared on Autoblog on Tue, 27 Apr 2010 16:20:00 EST. Please see our terms for use of feeds.

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Report: GM to announce repayment of federal loans in full on Wednesday

Jeremy Korzeniewski — Mon, 19 Apr 2010 18:00:00 EST

Filed under: Government/Legal, GM, Earnings/Financials

According to The Detroit News, General Motors will announce that it is fully repaying the federal loans it received last summer from both the United States and Canadian governments. In total, General Motors will have paid back about $6.7 billion ($2 billion of which has already been returned) of the $50 billion it received from the U.S., the majority of which was recovered by acquiring a 61-percent share of the automaker.

For those keeping track of such things and assuming this report is accurate, GM will have paid the entire amount agreed upon with the U.S. Treasury a full two months earlier than anticipated. This accelerated schedule is said to be seen as good news by both the automaker and the federal government. We'd guess that this is also a sign that GM is likely still on track for an initial public offering sometime this year.

GM CEO Ed Whitacre is expected to make the announcement on Wednesday when he makes a speech at a GM plant in Kansas. Later that day, Whitacre will make his first appearance at Capitol Hill since taking over at the head of the company in January. For what it's worth, the automaker has also called a press conference on Wednesday that we'll be attending. Stay tuned.

[Source: Detroit News | Image: Bill Pugliano/Getty]

Report: GM to announce repayment of federal loans in full on Wednesday originally appeared on Autoblog on Mon, 19 Apr 2010 18:00:00 EST. Please see our terms for use of feeds.

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GM asking Department of Energy for $2.6 billion to build hybrids?

Jeremy Korzeniewski — Thu, 02 Apr 2009 15:20:00 EST

Filed under: Hybrid, Government/Legal, Green, Chevrolet, GM

Click above for high-res image gallery of the 2011 Chevy Volt

General Motors released an updated business plan to Congress on Wednesday, and one of the main points of interest surrounds the automaker's request of an additional $2.6 billion for the production of the Chevrolet Volt and two additional variants based on the same Voltec powertrain architecture.

The report doesn't spell out what the two new Volt-like models would be, but there's speculation a production model based on the Cadillac Converj concept (possibly as a 4-door sedan) might be in the works. Offering the Volt's high-tech and expensive powertrain at a Caddy-level price point makes plenty of sense as it would allow GM to subsidize the cost of its development and lower the price of production.

These funds would reportedly come from the Department of Energy's $25 billion Advanced Technology Vehicle Manufacturing Program and is separate from - and in addition to - the ongoing negotiations for bailout funds between General Motors, Chrysler and the U.S. government. The total amount GM has requested under the D.O.E. program now stands at $10.3 billion.

Gallery: 2011 Chevrolet Volt

[Source: Reuters]

GM asking Department of Energy for $2.6 billion to build hybrids? originally appeared on Autoblog on Thu, 02 Apr 2009 15:20:00 EST. Please see our terms for use of feeds.

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UAW wants executive pay to be limited

Michael Harley — Mon, 01 Dec 2008 12:32:00 EST

Filed under: Plants/Manufacturing, Chrysler, Ford, GM, Earnings/Financials, UAW/Unions

The president of the United Auto Workers union, Ron Gettelfinger, said in a recent CNN interview that U.S. automakers need to tell Congress they will limit corporate pay, bonuses and severance packages in return for more government loans. Gettelfinger also said that the Detroit Three only need the loans to hold them over during these tough times. While the first statement from the union's top player seems like basic common sense, the second seems highly optimistic... especially when one considers the size of the industry and the depth of its issues. While no single event (or loan, for that matter) will likely turn around the downslide, all of those affected by the auto industry's potential demise will be interested in tomorrow's events. That's because Dec. 2 is the day House and Senate leaders told the automakers that they need to submit a "credible restructuring plan" that's convincing enough to get Congress to open its wallet when it reconvenes next week.

[Source: Reuters]

UAW wants executive pay to be limited originally appeared on Autoblog on Mon, 01 Dec 2008 12:32:00 EST. Please see our terms for use of feeds.

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GM wants $10 billion in aid from the Feds to buy Chrysler

Jonathon Ramsey — Tue, 28 Oct 2008 16:01:00 EST

Filed under: Government/Legal, Chrysler, GM, Earnings/Financials

In the latest development of The Incomprehensible Union, General Motors is reportedly asking the U.S. government for $10 billion -- on top of the $25 billion loan approved recently -- to help it merge with Chrysler. The supplemental infusion would give the government, i.e. you and me, a stake in the merged company in the form of preferred stock, would see the government taking over pension obligations and provide a credit line for operations.

The government is weighing the request since it's likely that no federal official wants to be on the watch that saw the instantaneous vaporizing of two American icons and hundreds of thousands of jobs. The government has asked that as many jobs as possible be spared, and GM said "Sure!" Yet for a merger where cost savings and redundancy elimination have been the headlines, we don't know why anyone believes GM-Chrysler wouldn't jettison a whole bunch of the 11 brands, 10,000 dealers, and 100,000 union jobs. And that's just for starters.

Which is one of the (many) reasons we still don't understand the GM-Chrysler union. The additional $10 billion we can swallow -- after all, the government spends much more than that on projects that could be considered far more dubious than trying to save an astronomical number of jobs and businesses. And we know what Cerberus gets from the deal. We'd like to find out what the GM guys see that makes this merger attractive... other than the fact that Chrysler has $11 billion in cash.

[Source: Reuters]

GM wants $10 billion in aid from the Feds to buy Chrysler originally appeared on Autoblog on Tue, 28 Oct 2008 16:01:00 EST. Please see our terms for use of feeds.

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GM may use profits from China to float North American operations

Jonathon Ramsey — Fri, 24 Oct 2008 09:02:00 EST

Filed under: China, GM, Earnings/Financials

Big Bob Lutz said that GM declaring bankruptcy is "out of the question." Of course, that was two years ago, when things like a $25 billion government loan would have sounded ludicrous. That was also before the auto industry mess got messier, and in order to stay true to those words today, GM is doing whatever it has to do to find money to stay in business. It heard Chrysler has an $11 billion piggy bank and a couple of jewels (Jeep and minivans) and GM said "Come here, girl! Lemme holla at you for a minute!"

Now GM is looking at its own international stable, and has its eye on China as a source of stopgap revenue for its North American operations. We've posted before on the fact that GM's international operations aren't doing too badly, and GM China sold 11.5 million vehicles last year -- more than any other manufacturer there. This year, it expects China sales volume to grow by 11- to 12-percent, and that means yuan in the bank.

Lutz said of the China move, "We do not rule out such a possibility under current conditions." These are hard times, but -- just like the good ones -- they're temporary, and GM just needs a little help to get to payday. Using money from one of your branches makes perfect sense to us. What doesn't make perfect sense is that China will get the Cruze the same time as Europe, in early '09, while we in the U.S. have to wait years in line for a car that we've been screaming for. Ah, GM, what are we going to do with you?

[Source: Gasgoo]

GM may use profits from China to float North American operations originally appeared on Autoblog on Fri, 24 Oct 2008 09:02:00 EST. Please see our terms for use of feeds.

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GM to dealers: There's a bonus in it for you if you don't lend them our money

Dan Roth — Thu, 16 Oct 2008 17:31:00 EST

Filed under: Car Buying, Etc., GM

General Motors is telling its dealers that there's a shiny nickel or two in it for them if they can sell cars without getting the GMAC finance arm involved. For every sale closed with outside financing, salespeople and managers will each receive $100, with an additional $50 going to someone the dealer designates. GMAC has already cracked down on borrowers with FICO scores below 700, and this looks like another move to discourage putting GM on the hook for risky loans; let someone else take that chance, the automaker seems to be saying to its dealers. Not all dealerships are happy with the plan, but GM and Cerberus Capital, which owns 49 percent of GMAC, must take steps to reduce potential losses. We can imagine that GM might lose some business to the newly tightened lending criteria, though there are plenty of third party loans out there, many even halfway reputable.

[Source: Automotive News - Sub. Req. | Photo: Justin Sullivan/Getty]

GM to dealers: There's a bonus in it for you if you don't lend them our money originally appeared on Autoblog on Thu, 16 Oct 2008 17:31:00 EST. Please see our terms for use of feeds.

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