This has to be very disappointing for Republicans.
The quarterly profit reported on Thursday marked G.M.’s strongest financial performance since 2004, and set the stage for the automaker to file for an initial public offering, possible as soon as Friday. It was G.M.’s second consecutive quarterly profit.
The automaker’s results were a marked improvement over the $865 million profit in the first quarter. Revenue also rose in the quarter, to $33.2 billion, from $31.5 billion in the first. G.M. did not report second-quarter results a year ago because it spend part of the period reorganizing under bankruptcy protection.
The second-quarter profit was driven by strong results in G.M.’s core North American business, which had lost money for several years leading up to its bankruptcy filing.
G.M. said it had earnings before interest and taxes of $1.6 billion in North America during the quarter, a 33 percent improvement over its first quarter performance.
I saw a guy on The Ed Show complaining that G.M. is expanding its business in Mexico instead of creating jobs here in the States. I agree with creating jobs here first, but saving the domestic auto industry saved millions of jobs and the entire way of life of people in Michigan. With G.M. showing big profits in its North America division, we should expect job growth here at home.
Don’t get too hasty. The CEO that brought them back has retired; he will be replaced by an executive (and current board member) who currently works for The Carlyle Group.
The shadow of Poppy Bush’s rolodex strikes again.;-)
Better Mexico than China. Also, do Republicans stop to consider that if GM creates good jobs in Mexico (at least good by Mexican standards) that this lessens the pressure on the border? Mexicans are proud of Mexico and their culture. Most would prefer to work in Mexico instead of Los Estados Unitas, where they suffer discrimination and alienation. They only come because they are desperate. Many admire the USA and wish to assimilate. They are welcome, but for those who only come because of necessity, isn’t it better to give them jobs in their home country?
I agree that we need to be trying to figure out ways to reconfigure the dozens of parts and assembly plants GM shuttered during restructuring. One of the things I’ll never forgive Ford for is the way they jacked us around at Chicago Assembly by showing us bogus prototypes of the new model we were supposed to be getting when they were planning to discontinue the old egg-shaped Taurus in 2005. We ended up with the Five Hundred which looked nothing like the prototypes. A few months later, this new car made in Mexico was introduced that looked identical to the prototypes we were shown before our product launch. That car was the Ford Fusion. The car’s been a big hit since its introduction, but there’s no way they could ever convince me our sister plant in Hapeville, Ga. couldn’t have done an equal or better job.
gm still doesn’t get it. the volt’s msrp is $41k. even with the $7500 fed tax credit that’s not a good deal by anyone’s status. add another $10 – 20k for dealer gouging and they’re going nowhere fast.
how many people are going to show up, take one look at that bs and go to a ford, nissan, toyota, or honda dealer? more than a few l’d venture.
same old myopic, short term, mba bean counter crap.
It’s sad that GM had to be brought to the brink to do what was needed to make it profitable.
Besides shed lots of pension and retiree healthcare costs, what exactly has GM done that has made it profitable?
When Chrysler was bailed out by the Carter administration, they clawed their way back to profitability with the minivan — and then sat on their heinies while Japanese companies deployed hybrids.
GM and Ford during this same 30-year period. Main contribution to the industry? The SUV.
I’ll believe the situation has turned around when I actually see innovative energy-saving and pollution-reducing technology in the showrooms at a price ordinary Americans can afford. Instead of calling crimping the body metal into a different pattern innovation.
The fact that the new CEO of GM is from the Carlyle Group does not give me a great deal of confidence that the UAW will be able to restore wages and benefits anytime soon. You want to know when the middle class is back? It’s when unions can get pay raises out of the increased productivity of the business. Because when they can get pay raises, non-union workers are getting pay raises too.
“Besides shed lots of pension and retiree healthcare costs, what exactly has GM done that has made it profitable?”
GM reduced its debt, shed extra dealers, closed unnecessary plants, and got rid of several brands. These were all important steps that would have kept GM out of bankruptcy if they had been done before 2008.
“then sat on their heinies while Japanese companies deployed hybrids.”
Chrysler was a well run and profitable company that was regularly introducing new product until it was bought by Daimler-Benz in 1998. It was the Germans who screwed up C, not the American management.
Thank you.
You are correct in your list of improvements GM has introduced since the bailout. Sadly, people in industry and within GM have been calling for most of those things for over 20 years. GM somehow just couldn’t pull it off. Not enough pain and it all just seemed too hard given internal politics.
I would add that styling-wise and product-wise GM has also finally found the mark. Bob Lutz’s design work is finally making it to the showroom.
I have to disagree about Chrysler though. They have been a mess for a long time. If anything Chrysler made Daimler worse, not the other way around. Mercedes wanted to learn from Chrysler how to run a mean, lean supply chain and all it really did was give its quality a big hit. Chryler OTOH got an excellent drive train for the 300. Way better than anything they could have developed themselves.
Chrysler nearly went broke again in the mid-90s. They had ridden the minivan thing into the ground and had nothing in the pipeline. Lutz and Eaton eased Iacocca out of the biz and shepherded the remake of the minivan (1996 model) which reset the bar for the category and brought Chrysler back to profitability. Lutz also introduced a slew of innovative products such as the PT Cruiser which established Chrysler as a unique brand.
But that all ended with the DC merger so in that regard maybe you are right. The real issue for me is culture. I was consulting to an engineer there who, when I asked him consider how Toyota might address an issue told me, “You don’t understand. Toyota is in the business to make cars. We are in the business to make money” No shit.