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CO2 emissions in US drop to 20-year low

Started by jimmy olsen, August 19, 2012, 08:44:10 PM

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jimmy olsen

#15
Quote from: OttoVonBismarck on August 20, 2012, 05:57:09 AM
Quote from: jimmy olsen on August 20, 2012, 12:02:57 AMI thought they were back on top selling the most vehicles in the world? :unsure:

They were relatively close to that when they went bankrupt.

As long as they sell a shitload of cars does it matter how good they are? Do they have a lot of legacy costs that are crippling them despite their high sales?
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1 Karma Chameleon point

The Minsky Moment

They still have big pension liabilities.

But OTOH they have been profitable 10 straight quarters despite not a particularly favorable economic environment (particularly for their Europe operations).

They could go bankrupt in 4-5 years, but it doesn't seem to follow from their recent performance.
The purpose of studying economics is not to acquire a set of ready-made answers to economic questions, but to learn how to avoid being deceived by economists.
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OttoVonBismarck

Quote from: jimmy olsen on August 20, 2012, 07:05:50 AMAs long as they sell a shitload of cars does it matter how good they are? Do they have a lot of legacy costs that are crippling them despite their high sales?

Well, they went bankrupt selling a shitload of cars. It isn't just pension liabilities, at a certain point if their cars aren't competitive enough to take significant market share the company will slowly become squeezed out. They are getting hammered in Europe and aren't doing particularly well in the United States, I don't know that they can stay profitable in such a climate.

Unit sales doesn't necessarily matter to a car company, you can move a lot of cars by offering tons of incentives, but then your gross margin can become very low or you might even go into the red. So far GM isn't in the red or anything, but their market share isn't impressive and it looks like all of their competitors have just released better products. As the article I linked to says, in the D-Class of automobiles you're basically looking at a 5 year development cycle. In the current 5-year cycle GM is going to lose, because its Chevy Malibu is basically last in its class, and that's the most important car sub-market in the United States. I'm not sure what GM's balance sheets will look like after 20 quarters of being in dead last in the D-Class.