Followers

November 7, 2008

General Motors says its may go bankrupt

CARS/UNITED STATES - General Motors Corp. says it lost $2.5 billion in the third quarter and warned that it could run out of cash in 2009. On Monday the US Treasury rejected GM/Chrysler Merger Aid. Chrysler and GM have been hard hit by the automotive recession.

GM also said it has suspended talks to merge with Chrysler. While it didn't specifically name the automaker, GM said it was setting aside considerations for a "strategic acquisition.''

The automaker also said its cash burn for the quarter accelerated to $6.9 billion due to a severe U.S. auto sales slump.

The company on Friday reported a net loss of $4.45 per share during the quarter, compared with a record-setting loss of $39 billion, or $68.85 per share, a year ago.

Revenue fell to $37.9 billion from $43.7 billion, due largely to credit freezing across the globe.

The loss exceeded Wall Street estimates. Analysts surveyed by Thomson Reuters predicted a loss of $3.70 per share on sales of $39.4 billion.

The struggling company announced it would improve liquidity by $5 billion by the end of next year by cutting capital spending, reducing sales promotions, and further cutting production in the first quarter. It also suspended the company match for its stock savings (401k) plan in the U.S.

"Even if GM implements the planned operating actions that are substantially within its control, GM's estimated liquidity during the remainder of 2008 will approach the minimum amount necessary to operate its business," General Motors said in a news release.

"Looking into the first two quarters of 2009, even with its planned actions, the company's estimated liquidity will fall significantly short of that amount unless economic and automotive industry conditions significantly improve" or it receives government funding, the GM news release said.

GM shares fell 53 cents, or 11 per cent, to $4.27 in morning trading.

General Motors is considering selling off its smaller brands: GM’s three biggest brands are Chevrolet, which accounted for 59% of 2007 sales, followed distantly by GMC at 13% and Pontiac at 9.4%. The five other GM brands lag far behind: Cadillac, with 5.6% of sales; and Saturn, 6.3%; Buick, 4.9%; and Saab, less than 1%. (Hummer accounted for 1.5%).



Ford posts huge losses, warns of job cuts


Ford Motor Co. said Friday it lost $129 million in the third quarter as the struggling automaker burned through $7.7 billion in cash.

The automaker also said it will cut about 2,300 more white-collar employees in North America as it tries to weather the worst economic downturn in decades.

Ford said it lost six cents per share for the quarter, compared with a loss of $380 million, 19 cents per share, a year ago.

The company posted a pretax loss of $2.7 billion from continuing operations. This partly offset by a $2-billion gain as the company shifted retiree health care liabilities to a trust run by the United Auto Workers.

Ford's global automotive operations had a pretax loss of $2.9 billion for the quarter, compared with a pretax loss of $362 million a year earlier.

Sales fell 22 per cent to $32.1 billion from $41.1 billion due to lower volume and the sale of Jaguar and Land Rover.

Ford said it lost $2.6 billion pretax in North America, compared with a loss of $1 billion in the year-ago period.

It recorded a pretax profit of $480 million in South America, compared with $386 million last year. In Europe, the company made $69 million, a sharp drop from the $293 million in the year-ago period.

Ford's Asia-Pacific operations made $4 million, down from $30 million. It lost $1 million on its interest in Mazda, compared with a profit of $14 million in the third quarter of last year.

Volvo lost $458 million, wider than the $167 million loss last year. Ford Motor Credit Co. had a pretax profit of $161 million, far lower than the $546 million in the same quarter last year.

No comments:

Post a Comment

Comments containing links will be marked as spam and not approved. We moderate every comment. If you want to advertise on this blog it is $30 per link.

Affordable Website Design & SEO

Looking for a quality professional website designer? Why not go where the smart money is?! Toronto Website Design and Toronto SEO. Get free SEO advice from people who really know the business.

Featured Posts

The Sarcasm Symbol
Ever had some confusion online or with your cellphone when someone fails to catch the sarcasm? Well now with the SarcMark you can ge...
Behold, the Scorpion Hydrogen Supercar
CARS - To the right is the future of supercars... it is a hydrogen supercar called the Scorpion. The Scorpion from Ronn Motors in Texas is t...
Documents show Stephen Harper misusing public funds
CANADA - According to 950+ pages of documents obtained by the Canadian Press under the Access to Information Act the Privy Coun...
Pink's Rosie the Riveter
ENTERTAINMENT - What I like about this video is how it meshes different social movements like feminism, veganism, anti-capitalism...
California's Dustbowl
ENVIRONMENT - The photo on the right is a farm in California that has been put up for sale. Its just one of thousands of farms that are n...
Is Steampunk the New Goth???
GOTHIC - Watch out what you see on the subway late at night because while in 2001 you might have seen some pretty freakish goths, by 20...
Do you have enough Ice Water in your diet?
HEALTH - A Calorie (large C) is a measurement of the amount of energy needed to raise the temperature of a litre of water (1 kg's worth) ...
North Korean timeline towards Inevitable War
POLITICS - The following is timeline of events that have occurred on the Korean Peninsula. 1945 - Japan surrenders to the United States a...
Judgment Day is Tomorrow, so sayeth Cult
RELIGION - According to a cult based in California, Judgement Day is tomorrow (May 21st 2011) and Jesus Christ will return to the Earth a...
Sex in Space Forbidden
SEX/TECHNOLOGY - Sex in outer space is a big no-no according to NASA. Not for professional astronauts at least, but the growing numb...

Popular Posts