has had what can be conservatively called a
. In a live press conference, CEO Rick Wagoner delivered sobering news about health care cuts, asset sales, retirement and separation packages, and the elimination of
dividend. The doom and gloom hasn't scared off the General's Dealer Council, as 20 retailers purchased a combined $1m in GM stock to show their support. Of course $1m isn't going to help much in the face of $15
in cuts, but co-chair Duane Paddock wanted to make the gesture to show GM and its massive
body that the council believes in the struggling automaker.
The move could be considered risky in light of the fact GM stock has dropped like a rock over the past couple months, and when the stock dropped to below $9 per share, it was a 50-year low point. So far the council looks both loyal and fiscally prudent. After Wagoner's press conference, GM stock rose by 16.6%. That translates into about $170k in earnings in just under a week. The way vehicle sales have been at GM dealerships, the dealers may want to try their hand in the market more often.
[Source: Automotive News (subs req'd)]