GM Death Watch

[TRS]

http://www.thetruthaboutcars.com/editorials.php

GM is up about 19% in the last couple of weeks, BUT fundamentals IMO have not changed.

http://www.thetruthaboutcars.com/editorials.php

[HenryTo]

Chrysler now putting a further squeeze on both GM and F:

http://www.caranddriver.com/dailyautoinsider/11254/chrysler-to-offer-employee-discount-deals-to-all-buyers.html

[HenryTo]

Latest GM update from "The Truth About Cars." GM continues to be a shrinking shell of its former self - and is quickly running out of liquidity. It is now effectively out of the Japanese market - and its Chinese business is also now being squeezed.

http://www.thetruthaboutcars.com/?p=1701

[HenryTo]

Tales from the dark side. More signs that the GM 2007 SUV lineup will be a failure:

http://cnn.edmunds.com/advice/specialreports/articles/115584/article.html

[HenryTo]

The final insult for GM. In the meantime, the overcapacity in auto manufacturing in China will continue to squeeze GM's bottom line in the Middle Kingdom:
--------------------------------------------------------------------------------
Japanese Dealers Cut Number of GM Sales
Friday June 9, 8:10 am ET
Japanese Imported-Car Dealer Slashing Number of Stores Selling GM

TOKYO (AP) -- Yanase & Co., a Japanese chain that sells imported autos, is slashing the number of dealerships handling General Motors vehicles, which have long been unpopular in Japan.
Yanase sells GM vehicles at 26 of the nearly 160 stores it operates in Japan. It has not yet decided how many it will keep to sell GM autos, including Cadillac and Hummer models, Yanase spokesman Kazuya Fukushiro said Friday.

As part of its turnaround efforts, General Motors Corp., the world's biggest automaker, has been reshaping its global operations. Last month, the Detroit-based automaker said it will stop selling Opel models in Japan, although it will continue to sell Cadillacs, Hummers and Corvettes.

Yanase said it will switch GM showrooms to showrooms selling DaimlerChrysler AG's Mercedes-Benz models, which continue to be popular in Japan among imports.

U.S. cars have long had a reputation as poorly made gas-guzzlers in Japan, home to leading automakers such as Toyota Motor Corp. and Honda Motor Co.

Yanase, which began selling GM cars here in 1915, sold just 3,000 GM cars in Japan last year, and that may shrink to half soon, Fukushiro said. Through May, sales of GM cars totaled about 1,000, he said.

The Nihon Keizai Shimbun, Japan's top business daily, reported Friday that Yanase dealerships selling GM will be slashed to six or seven by October. Fukushiro said a reduction was definitely in the works but numbers weren't decided yet.

GM has been struggling lately as it loses market share to rivals, including Japanese automakers. GM revised its first-quarter earnings last month to a $445 million profit. In April, it had reported a $323 million loss but changed that to reflect a health care settlement and other adjustments.

[HenryTo]

Their Sonatas in the U.S. actually look pretty good - although I have heard a lot of compliants about the interiors. That being said, I remember looking at the Nissan Altima when the current version become available in late 2001, and I didn't see anything I liked either inside the car. Give it another few years and Korean cars will become much more prevalent.

[rffrydr]

Hyundai had its best May ever. Funny.

[HenryTo]

16% y-o-y drop in total vehicle sales during May as opposed to an estimated 11%:

http://biz.yahoo.com/rb/060601/autos_sales_gm.html?.v=4

[rffrydr]

Another view to Chinese automotive expansion: we still have DOT on our side:

http://msnbc.msn.com/id/13064060/

[Prospero]

I was bullish on GM in the short term, but I think a downward move is quite likely now, or at least not much movement higher. Technically speaking, the breakout from the trading range between $18-19 and $23-24 could be expcted to roughly match the depth of the trading range itself, which is why I expected a move up to the $29-30 area. I think GM may hover around where it is for a little while ($27-28), and the 'quality' of the action will indicate whether the rally has legs or whether GM investors will revert their attention to the fundamental problems which Henry so often points out.

I've been stopped out of my long by now, but that's what I anticipate. On the bearish side, it would be rather shocking if GM were able to buck the recent severe downward pressure in the stock indices, having been a laggard for so long. On the bullish side, that's precisely what it has done for the past three weeks...

[HenryTo]

Re: Gas incentives for SUVs being sold in California and Florida

I guess one needs to do what one needs to do in other to move inventories sitting on the dealers' lots. As a "responsible capitalist" (if there is such a word), however, this has to be the last option, as doing this artifically keeps gas prices high, encourages more pollution, and as it puts your company in a synthetic short position in oil.

Indonesia did this on a much grander scale until last year, and look where it got them (the government nearly ran out of money).

My guess is that GM will ultimately pay for this "lack of responsibility."

[rffrydr]

Here's an "American" answer:

http://media.ford.com/newsroom/release_display.cfm?release=22295

Tight.

[TRS]

It's bizarre how two top institutions have pumped GM in the last week.
Any big summer rebates will mean the lots are full.

http://www.thetruthaboutcars.com/content/1148666130634673931/

[rffrydr]

You buy a fullsize truck in CA (and FL?) GM's capping your gas at 1.99!

[HenryTo]

Wildcat strike at Oshawa Parts Supplier:

http://www.autoserviceworld.com/issues/ISArticle.asp?id=56301&issue=05242006

[HenryTo]

Heard on the streets in Houston:

http://finance.messages.yahoo.com/bbs?action=m&board=7077666&tid=gm&sid=7077666&mid=290959

Just checked the websites of a couple of local dealerships - and there is a huge inventory of both 2007 Suburbans and Tahoes - not to mention huge savings:

http://www.machaikchevy.com/en_US/frm_index.chtml?pageName=MiscPage_1&noc=1&overrideUrl=f_MiscPage_1.chtml

http://www.munday-chevrolet.com/

Bottom line: The 2007 lineup of GM SUVs are not selling.