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Lordstown
Nov 28, 2018 8:22:36 GMT -5
via mobile
Post by Deleted on Nov 28, 2018 8:22:36 GMT -5
Horrible news out of the Mahoning Valley that the Lordstown GM plant is closing down March of ‘19. Will definitely affect that area’s financial situation
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Post by sportsjock on Nov 28, 2018 9:14:48 GMT -5
Lordstown is closing.....again. President Trump is very upset with GM, in the fact they are closing none of their plants in Mexico or overseas. He is threatening to take action to eliminate government subsidies to GM. These American workers are paying these subsidies through their tax dollars. I'm all for getting on their butts for this slight on the American worker, but I think it will require Congressional approval.
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Post by Whittaker on Nov 28, 2018 11:02:29 GMT -5
Shouldn't GM talk be posted in the Walking Dead thread?
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Post by nocommonsense on Nov 29, 2018 8:43:07 GMT -5
Sounds like Ontario all over again.
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Post by shelbyrr11 on Nov 29, 2018 9:26:24 GMT -5
Per the Wall Street Journal, in the 1990s, about 60-70% of vehicles sold in this country were passenger vehicles/sedans with about 30% being light trucks. This ratio has reversed in today's market, with 60-70% of vehicles sold in the country being light trucks and the remainder being passenger vehicles/sedans (i.e. Chevy Cruze). Lordstown made the Chevy Cruze. GM cited this, along with concerns that this "auto sales cycle" has hit its peak, and that they need to be proactive in the inevitable event that this record long non-recessionary period will not continue forever. Short of completely overhauling that factory (and the costs associated with retooling that and local suppliers to fit the needs of a new plant), this was the best outcome to protect GM's finances. This is likely a lesson learned from their bankruptcy last decade. It is absolutely brutal for that community, and I hope everyone can be fortunate in this period of sub 4% unemployment versus the last GM closures which happened in the midst of the recession.
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Post by Buckeye2b on Nov 29, 2018 10:00:24 GMT -5
I heard yesterday that Chevy is making the push to go "all electric." If they do, I'll never have another Silverado...
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Post by shelbyrr11 on Nov 29, 2018 11:03:37 GMT -5
I typed this up and realized I'm going full-crazy but I don't care because half of you are nuts anyway.
I'd rather own stock in a company who is trying to prepare for future competition than one who doesn't keep an eye on the future. Driverless cars, fully electric vehicles, they don't show a ton of promise for record sales anytime soon because the product isn't feasible/too expensive/not needed due to gas prices/not sexy enough. That's fair. I think it is still necessary they have to keep putting work and funding into their R&D. Ford is getting caught with their pants down in the electric/driverless car race. Their stock has nearly halved in the past 5 years, while GM has held steady. I care more about value investing than speculation, and there are plenty of other reasons why Ford has dropped in comparison to GM (revolving leadership, for one), but people are also betting down on their future prospects because they have been slow to invest in their R&D and slow to acquire technology startups. Time will tell.
However, what happens when a Chinese competitor comes up with a suite of fully electronic vehicles before a US company does? China is already enveloping the world with their Xiaomi phones. For a stretch, they performed better than Apple phones and were factors cheaper. I believe this is still the case. China is aware they have never laid claim to a global car company the way GM, Ford, and Toyota has. Europe has less transgressions with dealing with China than we do (they use their Xiaomi phones, for one). Europe is also extremely emissions-conscious in relation to the US. Geely is the big car conglomerate in China (they now own the Volvo brand). China is 1000% gunning for electric car superiority. Granted, electric cars are subsidized out the butt over there and they are still a fraction of car ownership (still way big compared to the US).
"In addition to increased competition, Chinese regulators have announced aggressive policy initiatives and quotas for the sale of electric vehicles." - This comes from GM's "Risk Factors" portion of their most recent 10-K.
I don't know when I'll buy an electric car. Not this year, not in five years. I only buy used cars anyway. I could give a hoot what my car is and how new it is. But I certainly hope we win this car race with China.
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Post by Willard Fillmore on Nov 29, 2018 13:19:46 GMT -5
Is one nuts if we question why one of the Big Three would want to build a new line of cars in China? Where they use slave labor from North Korea.
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Post by shelbyrr11 on Nov 29, 2018 15:03:24 GMT -5
It isn't nuts to question that. From a shareholder perspective, it would be responsible to do so.
Willard, your question is addressing (in my understanding) a different situation than the fact that is a Big Three, in this case GM, is trying to stem losses from unprofitable product lines in friendly territories, such as closing a Chevy Cruze line in Lordstown or selling off their European Opel and Vauxhall units to a French carmaker last year. Beyond the harm of job loss, these moves should come with holistic backing if we are concerned about the entire company. I guess with Lordstown, I am assuming that some capacity will be added to Mexican factories (assuming they make the Cruze there), but only because the demand would exist there versus the US (where it does not). This would open a whole new conversation that I don't have the heart to dig into at the moment.
With China? Now it depends on your values. If one is a shareholder of a Big Three, let's say GM, they have to consider whether GM's domestic operations and their benefits outweigh the following: do they want GM to be discovering new revenue streams in China? Is it worth it to get these streams from China, where they only allow US companies to own 49% of their business on China's land (and potentially having manufacturing and intellectual stolen away)? Is it worth it to take on the additional risk of China's (in my understanding, considerably) looser financial reporting and regulatory standards? Is it worth it to deal with ethical and human rights violations that are rampant in China? Is it worth it to attempt to gain clout in China before their auto producers, like Geely, get a chance to?
Unfortunately, this is a very gray issue. At the end of the day, abstaining from purchasing GM cars or stock to defy their approach to China will not slow their strategy unless a material amount of people/businesses view it outrageous. I think there is great value to trying to claim market share in China, where the burgeoning middle class is able to afford cars now. However, it is China we are talking here. Not exactly a champion of ethical behavior.
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Post by nocommonsense on Nov 29, 2018 16:00:00 GMT -5
One big problem for GM is Toyota and Honda build a better product.
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Post by Willard Fillmore on Nov 29, 2018 18:27:54 GMT -5
It isn't nuts to question that. From a shareholder perspective, it would be responsible to do so. Willard, your question is addressing (in my understanding) a different situation than the fact that is a Big Three, in this case GM, is trying to stem losses from unprofitable product lines in friendly territories, such as closing a Chevy Cruze line in Lordstown or selling off their European Opel and Vauxhall units to a French carmaker last year. Beyond the harm of job loss, these moves should come with holistic backing if we are concerned about the entire company. I guess with Lordstown, I am assuming that some capacity will be added to Mexican factories (assuming they make the Cruze there), but only because the demand would exist there versus the US (where it does not). This would open a whole new conversation that I don't have the heart to dig into at the moment. With China? Now it depends on your values. If one is a shareholder of a Big Three, let's say GM, they have to consider whether GM's domestic operations and their benefits outweigh the following: do they want GM to be discovering new revenue streams in China? Is it worth it to get these streams from China, where they only allow US companies to own 49% of their business on China's land (and potentially having manufacturing and intellectual stolen away)? Is it worth it to take on the additional risk of China's (in my understanding, considerably) looser financial reporting and regulatory standards? Is it worth it to deal with ethical and human rights violations that are rampant in China? Is it worth it to attempt to gain clout in China before their auto producers, like Geely, get a chance to? Unfortunately, this is a very gray issue. At the end of the day, abstaining from purchasing GM cars or stock to defy their approach to China will not slow their strategy unless a material amount of people/businesses view it outrageous. I think there is great value to trying to claim market share in China, where the burgeoning middle class is able to afford cars now. However, it is China we are talking here. Not exactly a champion of ethical behavior. Believe it or not, GM sells more cars in China than in the US. Do they think they will sell more electric cars in China if the Chinese as you say are the leaders in the technology? BTW Lordstown has had it's head on the chopping block for years. It was inevitable.
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Post by shelbyrr11 on Nov 29, 2018 21:16:40 GMT -5
I did not say the Chinese are leaders in the technology, but merely the sales of the technology. I can't recall my numbers, but it would be the equivalent of saying that 0.1% of cars sold in the US are electric, whereas 2% are in China.
I did say that their cellphone technology is unquestionably comparable and better than Apple, depending on the measures people used. Huawei and Xiaomi are the names to Google.
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Deleted
Deleted Member
Posts: 0
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Lordstown
Nov 30, 2018 8:19:33 GMT -5
via mobile
Post by Deleted on Nov 30, 2018 8:19:33 GMT -5
GM closing 5 plants throughout the US resulting in the loss of 14,000 jobs
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Post by shelbyrr11 on Nov 30, 2018 9:44:23 GMT -5
Another Wall Street Journal factoid:
GM plants were at 92% utilization in 2015 in North America, and before the announcement of closing plants, they were at 84% just three years later. I don't know where their margins lie but at some point your overhead starts to nip away at your aggregate profit per vehicle sold.
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Post by clb6110 on Nov 30, 2018 17:31:00 GMT -5
I feel bad for all the GM employees that will lose their job. I read that for every GM job lost there are 7 non GM jobs that are directly effected. So if 14000 GM jobs are lost nearly 100K total jobs are effected. Terrible! BUT GM and the rest of the big 3 have shot themselves in the foot. The wages that the UAW have negotiated have driven the cost of US made autos through the roof. The common working person simply can't afford a 50K pickup or even a cheaply built 25K Cruz. That car is not much. GM is cutting jobs,closing plants and Toyota/Mazda are building a multi BILLION dollar plant in Huntsville AL creating 1000s of jobs. They must be doing something right.
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Post by sportsjock on Nov 30, 2018 18:59:18 GMT -5
I feel bad for all the GM employees that will lose their job. I read that for every GM job lost there are 7 non GM jobs that are directly effected. So if 14000 GM jobs are lost nearly 100K total jobs are effected. Terrible! BUT GM and the rest of the big 3 have shot themselves in the foot. The wages that the UAW have negotiated have driven the cost of US made autos through the roof. The common working person simply can't afford a 50K pickup or even a cheaply built 25K Cruz. That car is not much. GM is cutting jobs,closing plants and Toyota/Mazda are building a multi BILLION dollar plant in Huntsville AL creating 1000s of jobs. They must be doing something right. You failed to mention that Honda has invested billions in plant expansions the past two years, some in Ohio.
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Post by Willard Fillmore on Nov 30, 2018 19:38:28 GMT -5
I feel bad for all the GM employees that will lose their job. I read that for every GM job lost there are 7 non GM jobs that are directly effected. So if 14000 GM jobs are lost nearly 100K total jobs are effected. Terrible! BUT GM and the rest of the big 3 have shot themselves in the foot. The wages that the UAW have negotiated have driven the cost of US made autos through the roof. The common working person simply can't afford a 50K pickup or even a cheaply built 25K Cruz. That car is not much. GM is cutting jobs,closing plants and Toyota/Mazda are building a multi BILLION dollar plant in Huntsville AL creating 1000s of jobs. They must be doing something right. What they're doing right is avoiding the costs and damage to ship cars across the Pacific Ocean. What they're doing right is building their plants in right to work states. What they're doing right is being able to keep the UAW out of their plants.
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