Comments on: GM needs to double earnings to repay taxpayers Mon, 26 Sep 2016 03:26:00 +0000 hourly 1 By: rcwhalen Mon, 30 Aug 2010 14:27:05 +0000 Good report. This is precisely why I have been critical of Tim Geithner’s strategy for GM and the IPO. What is the hurry? GM needs to replace all of the Ally/GMAC financing operation and thereby internalize all profits from car finance. GM cannot hit the profit targets you cite — if ever — unless all of the captive finance is in the house. That still leaves about 50% of sales to the banks, but GM cannot compete globally without replacing GMAC. Thus my bear view on Ally/GMAC.

By: dallasdave Fri, 20 Aug 2010 12:52:04 +0000 Mr. Currie has made an excellent analysis. The US government is selling its stake at a loss. I think that this is mostly due to political pressure to declare victory for Obama’s decision to nationalize GM and Chrysler last year.

On the business side Mr. Currie points out that GM seriously lags F in North America profit margin. Even more remarkable since GM’s labor agreement is more favorable than Ford.

The China results mean nothing since the success of the GM brand in China is due to the fact that GM’s partner there (SAIC) runs the business very well (SAIC also has successful JV with VW and also runs its own SAIC brands). GM had nothing to do with the success in China.

All in all go short GM and long Ford so you can be net neutral to the Unionised US auto industry. GM management is clearly inferior largely because the Ford family still controls Ford and is unwilling to see it collapse. This ensures that Ford will take the necessary steps to survive and prosper while GM flounders under its hired hands and government ownership.
What this all means is that