GM & Chrysler aiming for huge profits

CARS - Chrysler and General Motors are already predicting huge profits due to the market rebound in automotive sales which are up 16.7% in the last 4 months.

That should do well for General Motors which still owes another $40 billion to the American and Canadian governments for its buyout one year ago this week.

There are a variety of reasons for the sudden profitability of the two companies.

#1. More credit available to car buyers.

#2. More focus on catering to younger buyers with SAT Nav and DVD players for family cars.

#3. Scrapping of brands that don't sell as much. ie. Pontiac, Saturn, Saab and Hummer are all gone.

#4. No more marketing to golf fans and the older generation. Few Americans play golf anyway.

#5. No more building excess capacity of cars that aren't selling fast enough, resulting in those cars later being sold at a loss.

#6. Scrapping car models that are too slow at selling.

#7. More focus on small cars in order to compete with small cheap imports.

#8. More focus on gasoline efficiency, considering the recent shift in the market towards greener cars and the worry about gas prices.

But Chrysler and General Motors aren't out of the woods yet. This summer a whole slew of new cheap cars imported from China and India are coming to North America. If you think Japanese and Korean cars are cheap... Pfff! You haven't seen anything yet.