Friday, March 06, 2009

What GM Should Do...

75 years is a long time to have a zero percent return on the stock price. But, that is how long it has been since their stock has been as low as it is. Think about that. It means essentially anyone who has bought GM stock in the last 75 years (and still owns it) has lost money. If ever there is a statement by the market of your business model, that is it.

At this point, they need to go bold. Announce they are going BK and reorgnize with a new cost structure. One without unions. The problem isn't the cars they make, and it isn't having American workers. It is American workers in unions and the cost structure they force upon the Big 3. I realize the Detroit workers won't likely agree to now work for a non-union GM. That's where it gets interesting.

GM should do what a truly competitive company would do. Open a plant right where the workers they DO want are. Prime example would be near the Honda plant in Ohio. I bet a bunch of those workers would LOVE to work for an American car company. The problem w/ GM isn't their cars, they are really quite good now. The American worker is also very productive.

I had a Honda Element built in Ohio and it was top notch. If I could buy a GM car made by those same workers, I'd do it in a heartbeat, and I bet a lot of other Americans would also. I was born in Ohio and I'd love to see that happen.

What do you think? I'd love to hear from any worker at a US plant of a non-union foreign automaker and ask if they'd go work for GM if they could. This assumes GM is now reorganized as efficient and well run as the current company they work for.

I'm sorry it would be truly devastating for Detroit, but, I'm afraid their fate is sealed no matter what happens. The issue is will there be a GM going forward at all.


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