GM Bankrupt

As the manufacturing parts of GM is pretty much related to the Ontario Economy, I will withhold my answer
... Quite frankly though, at the current rate, Dealerships are going to
struggle bug time and well before GM does. It's already happened this year in T.O.
 
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Nice negative topic...

Timing in business is critical and certainly this is bad timing for GM and the rest of the car companies who are now looking to recover engineering and tooling costs on new models. Many new orders and perspective buying plans will be scrapped with the economic meltdown that is coming for consumers buying not only cars, but pretty much everything.
Why wouldn’t they deserve a bailout? This supports the 10s of thousands of workers who basically would benefit as much as the company, let alone the economy in general.

Thinking you need to look at the bigger picture. before you get all triggered; remember you asked the question. Best be prepared for the answers.
GM will be only one of many that will be at risk of falling as this mess moves forward. We have huge adversity ahead and better be prepared to pay for it. let’s see what the banks do is a more pressing question for me as it has an impact on pretty much every Canadian. So far they are not clear on interest for deferred mortgage payments and loans. Fortunately at this stage I’m not subject to any of that but it is still a massive deal for all of us as it too will have a knockoff effect in many ways in the mid to long term.
Sorry didn’t mean to derail your topic but it just seemed a bit shortsighted.
Hope you come through unscathed.
 
I would say yes. The Government will have a stimulus package to assist business through what is a very uncertain and unpredictable period. Not many Companies or Individuals will come out of this unscathed and without doubt some will fail.
GM is a major contributor to the Global Economy so it would be in best interest to offer assistance if required albeit some restructuring to increase efficiencies should be implemented.
During the last bailout their Stock rebounded and it presented an excellent investment at the time. It could possibly happen again.
 
GM is going to take whatever is offered. They have accounting systems in place to make the money disappear in their global businesses never to be seen again. That is fine for GM not so good for taxpayers. So I guess my issue with bailouts is the lack of guarantees negotiated by governments of all levels to ensure the money is invested in our country for the benefit of the taxpayers who are footing the bill. Governments, as we know, are not good at protecting us nor our money.

Just my two cents.
 
This is a much more complex discussion on a much larger scale. If you are going to equate profitability to managerial expertise only then you need look no further than any level of government that constantly runs deficit budgets. Essentially your governments are bankrupt each and every year and have been so for decades. I would have to go back and research when the last surplus government budget existed. And these deficits have all occurred lately in a booming economy. The old argument was that you only needed deficits for the years of economic down turn. So, as has been rightly pointed out above, the auto sector, for better or worse, has been a major component of worldwide GDP and is a major contributor to the economy in terms of employment, taxes, etc. Those auto workers that get paid well, will buy cars, houses, clothes, pools, vacations, and go to restaurants. If you allow those jobs to be eliminated, then they become potentially unemployed with no opportunity for re-employment and therefore a dependent on some level of social assistance anyways. Not all can find new jobs in new sectors as their individual skills may not be transferable. I am not a big fan of government bailouts to corporations. Having said that, these times with the current pandemic are not the fault of negligent management. They are a casualty of this economic hit along with everyone else. If the stock market plunges 30% I am going to suspect that a few C8 buyers will be bailing out. Now lets extrapolate that across the entire product line. How many people that may loose their jobs, their retirement savings, etc. now will delay or simply not be in a position to buy a new car or truck. The big three will most certainly be taking a hit. and yes this will filter down to dealers everywhere. Remember that when a government says they will provide a stimulus package of money, its not their money, its yours. There is no pot of money sitting somewhere. They can print it and it eventually will be converted to tax revenue. Meaning your taxes will go up. On income, property, gas, etc. etc. We all pay for these bailouts, whoever gets them. Having said that, I support temporary measures to shore up the auto sector in the event of COVID-19. Not bailouts but loans that will be backed by shares and hopefully made whole when the companies return to profitability.
 
kerry4 said:
Bombardier is looking for more bailout money again. Think it's in the billions this time. It's like throwing money into a furnace.
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You are right on this one. In full disclosure, I own shares of Bombardier. I have seen them go from 15 to 1.50 in the past couple of years. Now there is a great example of mismanagement and corporate welfare. I cannot defend them but I will say that the CS-100 regional jet is about 20 years ahead of any other plane in its class. They just got crushed by Boeing. Had to literally give the plane to Airbus just to keep it going. The airplane building game is full of government money and it is the same for all of the makers worldwide. Takes a lot of cash to build planes. Boeing, Airbus, and Embraer will all be getting gobs of government money this time round. The 737 fiasco has cost Boeing billions. Timing is everything. Had the 737 debacle occured before Bombardier made the deal with Airbus, I think it would be a very different story today.
 
Yes usually it is bad management that is the cause of any disaster. Think Canada's 15 minutes of fame was when the Canada Arm was built for the shuttle. Who ever did that. Maybe Canada just isn't capable of making world wide products. Other than Maple syrup. LOL.
 
Yes. A GM bankruptcy will not only effect GM employees, but everyone from those that process raw materials, to those that make the parts, to truckers, mechanics, dealers, etc. Likely 1/2 + people. That is a huge economic hit. The US and Canadian government on running on fumes. They use borrowed money, taxpayers' money that doesn't exist. Chrysler was bailed out and has done quite well since. The bailout money would need to be paid back with interest. Someone once told me is you have 10 managers in a room, they won't be able to decide on what time it is. Larger the company, larger the inefficiencies. Billions in taxes would be lost. As much as I don't like government meddling in businesses, something of this magnitude and the potential fallout, is worth saving.
 
Given the very very long line up of companies directly impacted by this that will be asking for money i.e. airlines, hotels, travel companies not to mention small business shaft. I think auto will be very much down the list. Yes they will take a revenue hit but this should not topple them. As they are clearly shifting manufacturing to China I can't see how the optics will work out on this positively. Now if this stretches for over a year then we should all plan on living very different lifestyles. :) Government loans on the other hand might definitely be needed for all.
 
4 words:

“too big to fail”

Just like the banking collapse. No way in heck the usa allows the big three to go under. The effects of just unemployment it would generate would horrendous.

Now, what a “bail out package” looks like or what changes as a result of it is anybody’s guess.

Equally sobering is the fact that the USA bailouts (that may be coming) will do absolutely nothing for Canada, other than keep the USA based parent company open. The “big three Canada” is going to have to rely on the liberal cabinet decision makers for any bail out money...
 
... on a much smaller scale ...
There was quite a bit of Government of Canada Aide discussed yesterday.
Not surprisingly, I already hear a few around me already wondering “how can I get in on that?”
Well, my first approach is “how can I avoid being entitled to it?”.
This way I will know if I really really need it
and discovered that it just might keep my anxiety in check this way 😁👍🏻
 
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The intricacies of Government and multi-national business are something we seldom see, any more than government/business allows us to. What will be will be and decisions and deals will be made, details certainly not privy to us lowly peasants. Occasionally someone unwittingly (or other) reveals information we were not suppose to hear (ie: SNC-Lavalin) and gives us a very brief superficial view of the so called wise and culpable decisions government regularly makes under pretenses of looking out for it's people and country. And that my friends is diatribe resulting obviously from Day 1 of mandatory self-quarantine.... hmmmmmm..... If Nik or Murray doesn't do it first, I may also have to self-ban by day 3 if I keep reading this thread.... o_O
 
Any “bail out” of any multi-national must be tied to their closing and/or stopping of any manufacturing in China. China put us here, China should pay the price. Secondary to that is local employment (North America) would increase. The big question is, are you as a consumer prepared to pay more for your products as western manufacturing (primarily labour) costs are significantly higher.
 
moepig777 said:
The chips are gonna fall where they may. Please stay safe everyone and I personally wish you and your families the best.
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Thank you. We have to all keep in mind that we are still humans and need to be our brothers keepers. Helping people in need makes them feel good and us feel better than them. I have always lived by that and always willing to help people down on their luck.
 
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