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Pulling for the underdog
- By Dan Davis
- June 4, 2009
That's why I'm pulling for GM. No one thinks it has much of a chance for a recovery, and people are calling the $20 billion invested in the company and the other $30 billion slated to be invested a waste. It's a big deal, and the subject of small talk all over the country.
I'm not totally stupid. To think that the U.S. government will be in a position to recoup the almost $100 billion it has invested in both GM and Chrysler is farcical. But who's to say it couldn't recoup some or most of it? I think it's possible for GM.
Here are some reasons why I think that may happen:
- The demand for automobiles will return, and all manufacturers will benefit. Let's not pretend that this downturn in the auto industry was just a GM problem; it affected all companies. Even Toyota has seen global market share slip almost two points, from 18.4 percent to 16.5 percent, over the last year, and Ford only avoided coming to the government because of shrewd moves made by its CEO Alan Mullaly. Auto sales have stabilized, which could be a precursor to even more consumer activity.
- GM has finally rid itself of its burden of too many brands. Pontiac was the performance division, but why did Chevrolet dealers sell Corvettes and promote SS versions of its vehicles? Saturn started out as GM's small car brand, but that's not what it is today. GM will keep Chevrolet and Cadillac around, while also keeping the Buick brand for its Asian markets and GMC because the company earns its highest return on sales on those trucks. The smaller product lineup should give the company better market focus.
- The bureaucracy is crumbling. GM always had a problem evaluating its own efforts. Now with the changes in personnel and company structure, some people are reporting that a sort of entrepreneurial atmosphere exists in some corners of GM. One online report theorized that GM could vacate its downtown Detroit fortress and relocate to its technical center in the suburbs.
- GM is building pretty good cars. The company always will sell trucks because that's all some people will buy. However, the Chevy Malibu and Traverse are example of vehicles that are getting the attention of non-typical Chevrolet buyers.
So call it Government Motors. Call it Gimmee More. Call it what you want. I just know that things work out best for taxpayers if GM succeeds. I hope it's taking the right steps to make that happen.
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The Fabricator is North America's leading magazine for the metal forming and fabricating industry. The magazine delivers the news, technical articles, and case histories that enable fabricators to do their jobs more efficiently. The Fabricator has served the industry since 1970.
start your free subscriptionAbout the Author
Dan Davis
2135 Point Blvd.
Elgin, IL 60123
815-227-8281
Dan Davis is editor-in-chief of The Fabricator, the industry's most widely circulated metal fabricating magazine, and its sister publications, The Tube & Pipe Journal and The Welder. He has been with the publications since April 2002.
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