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The credit crisis and economy merely accelerated by a couple of years what would have eventually happened. GM hasn’t made money in over 4 years. This crash happened last year. GM has shed market share for years, abandoning tried and true segments like the small and mid size cars for high profit SUV’s and Trucks. This allowed the imports to slowly improve their products in these segments and gain market share. The glory days also lead to unsustainable contracts with labor and excess.
When the Japanese cars first came over they were crap, same to with Korean cars. But they kept at it and improved. The average car buyer wants an appliance that always starts, doesn’t cost them anything to run and gets them from point A to B as if they were in their living room on a comfy couch. It’s why a loathe the entire Toyota line-up except the FJ (which they are discontinuing).
Boards like this are for the niche car buyer, the enthusiast who cares about how a car drives and enjoys the part between the A and B.
We may see more loans to GM (remember they ran through their worst case scenario for all of 2009 in 3 months) but if they come back a 3rd time they’ll be forced into chap.11.
They should have voluntarily done it back in 2006 when they still had the cash reserves to restructure. But then we don’t do anything until it’s a crisis, from one crisis to the next and we forget about it all when times are good. We learned nothing during the oil embargo and already people are forgetting $4/gal gas of just 8 months ago.
If you are buying a GM or especially a Chrysler product I’d just make sure you put away a little extra to cover any repairs out of pocket.
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