GM Won’t Commit to Bailout Repayment… After Claiming Bailout Repayment Was Already Made
Posted by Jim Hoft on Thursday, November 18, 2010, 6:49 AM
Do you remember the controversial ad earlier this year where GM CEO announced that his company had paid back their government loans in full?… Then later we find out that they paid back only $8 billion of the $52 billion they borrowed?
…And, then we found out that GM paid off the bailout money by dipping into a separate bailout loan.
Now GM says it’s not sure if the company will pay off its bailout.
General Motors’ new stock got a good start out of the gate Thursday, opening up 6% to $35 from its offer price in its first trade…
…New CEO Dan Akerson said this was the right time for the company to go public again, but stopped short of promising that taxpayers would be paid back with future stock sales.
In January, then-CEO Ed Whitacre promised that taxpayers would be repaid and might even make money on the bailout.
“I think the government’s investment is well placed and I think they’ll make a lot of money,” Whitacre told CNNMoney on the floor of the annual auto show in Detroit. “It won’t be too long.”
But Thursday, Akerson, who succeeded Whitacre as CEO in September, was more cautious when speaking to CNNMoney on the floor of the New York Stock Exchange Thursday before the start of trading.
“I don’t know where the market is going to be a year or two down the road, so I can’t make such a bold statement,” he said. “Sure, I’m hopeful, and I’m not saying it can’t happen. I think the company is well positioned … so things look good for General Motors.”
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Published May 16, 2012 at 7:37 pm - 45 Comments
Granny commented:
BTW, the Feds are allowing this IPO at a loss –
http://www.reuters.com/article/idUSN1827687520101118
StandUp4Chuck commented:
I made the determination 15 years ago I would never touch a GM made product after driving several of them. Besides the awful engineering and the 100k mile expiration embeded into them, the supporting of a company that is run by labor unions always put a bad taste in my mouth. I really wish American engineering/production was on par with German or Japaneese car companies. I would love to buy cars from American makers but I wont support the blood sucking parasites they are infested with. Sad to say but GM should have been put out of business long ago.
Kenny Solomon commented:
GM press release just issued:
Don’t listen to what we said we did. Don’t listen to what we say we’re doing. Don’t listen to what we say we’re going to do. Just wait for the Executive Order from The White House telling us what to do. As for the money each of you taxpayers claim you gave us, we’d say ‘thanks’, but we don’t know what money you’re talking about. See ya later…… Suckaz.
tarpon commented:
Get in bed with government, evrybody gets screwed but government. Learn from it.
gastorgrab commented:
Outright theft!
There would have been no bailout for a non-union company. By all rights, GM went bankrupt and all of it’s remaining assets were seized by the government, and handed over to the UAW.
When any normal company fails, the remaining assets are sold, and the shareholders are payed whatever the asset sale will bring. The contract between union and company is concluded. If a new company is created with the remains of the old, the union must start their negotiations again from ZERO. They all become NEW employees of a NEW company, and the taxpayers are not burdened with the demands of the union.
IronDioPriest commented:
I will never, ever, ever purchase a GM product, unless and until the government relinquishes its financial ties to the company and restores it fully to private hands, and the assets of the secured creditors that we stolen by Obama and given to the UAW are returned in full to those creditors with interest.
IronDioPriest commented:
…that “were” stolen…”
(where’s that edit function???)
Joanne commented:
Buy Ford – no bailout, and they actually start in the cold.
martha commented:
As the owner of a 14 year old Buick, that I would like to replace, it will not be with another GM car. It’s going to be a Ford. I decided that when GM first took the bailout, and I have no intention of changing my mind.
I’m also very glad I never took the cash for clunkers deal either
Illinois Patriot commented:
I bought my last GM car in 1995 and never looked back. This newest gem just supports my decision 15 years ago. These people should be in jail!! If we had an honest justice department, they would be. Instead we have Holder’s Department of “Just Us”!
avery commented:
Did they not have to paid this year,are they not building a plant in Mexico.The head of these Union are screwing everyone include their memeber.
mark commented:
This is simply a strategy to transfer the losses from the horrible takeover decision of GM by Obama–to equity investors.
If you buy GM stock, you are essentially buying all the debt that Obama ran up inside GM. The problem with stock, unlike debt, is that nobody has to pay you back. Debt has obligations, stock is your own risk. So make sure, even if you invest in mutual funds, that GM isn’t in that portfolio.
In the Gov’t Motors Headquarters (read Oval Office) they are trying to dump the company on stupid investors. “Who is dumb enough to buy this crap?”
Free sales tip to stockbrokers trying to sell GM stock. Find out who is lining up to buy California’s new Bonds (called Revenue Anticipation Notes) Those are the idiots you want to target your phone calls to. Good luck. But hurry. While GM is up today, it will get hammered by next week when the excitement is worn out.
avery commented:
I left out the word Tax “Sorry”.
Granny commented:
#8 November 18, 2010 at 10:47 am
Joanne commented:
Buy Ford – no bailout, and they actually start in the cold.
________
Though one thing Ford does NOT do – supposedly in the interest of saving the planet – is warm up while idling. As a result, here in Vermont you have to try to defrost a windshield you can’t see out of while driving down the road. My daughter and I drover her Taurus exactly one winter. Most mornings my heart was in my throat trying to see out of the one-inch clear spot the defroster had created.
No Man commented:
No man should buy GM stock or GM cars. Look what Obama did to GM bondholders . . .
Buy Ford! I loved my 2002 Escape until Junior slow-rolled it.
Buy Toyota! No complaints with the Highlander.
. . . tax increases, endless spending and Washington-knows-best takeovers . . .
Dr. Mom commented:
The stock was intentionally offered at $33 and thus far is up 6% to $35? At $33/share, the government decided to blow $9 billion of our money to put on another show and pretend to get our money back. This is a sin of omission that should be punished accordingly. If it weren’t for alert and honest internet bloggers, who would know?
http://legalinsurrection.blogspot.com/2010/11/this-is-success-taxpayers-lost-9.html
RedBeard commented:
I drive a GMC pickup. Nothing wrong with it other than having Barry Soetero Obama (or whatever his name is currently) as the Chairman of the Board of the company that made it.
Z commented:
I purchase only non-union built vehicles.
antilbr commented:
Two words BUY FORD…….I have two mustangs an older one,and a 2009 mustang saleen,there is no problem heating this one up…..and by the way i eat vettes and camaros for breakfast and lunch!!!!!
Ladue Pundit commented:
How much of the IPO share price was taxpayer subsidized? Shouldn’t all taxpayers get some stake for having “skin” in the game? Like a stock certificate?
I drive a Jaguar (Ford once owned Jag). have 3 Volvos for my teenagers (Ford once owned Volvo), and 3 Ford heavy duty vehicles for my business. (And a Ford Focus which sucks).
I’ll have never owned GM and probably never will. Ford is actually making profits.
P.S. Granny, sorry about your Taurus. We keep a 2005 Taurus wagon at our rural property in Nebraska and every time we’re there it starts and runs. See your deealer.
mark commented:
OK one final note on this. If anyone thinks GM is a good deal–buyer beware.
In GM’s Securities and Exchange Commission filing for September 2010, their 10Q, they list a number of risks to the company but two standout.
1. They don’t know the auto industry (appointed by Obama remember)
2. Their financial controls and reporting procedures do not work so therefore the financials may not be accurate and that might negatively affect the company.
YOU CAN’T MAKE THIS STUFF UP. READ IT BELOW AND LOOK IT UP YOURSELF.
——————————————-
GM 10Q report to the SEC for Sept 2010–pages 164-166
RISKS:
The ability of our new executive management team to quickly learn the automotive industry and lead our
company will be critical to our ability to succeed, and our business and results of operations could be
materially adversely affected if they are unsuccessful.
Within the past year we have substantially changed our executive management team. We have a new Chief
Executive Officer who started on September 1, 2010 and a new Chief Financial Officer who started on
January 1, 2010, both of whom have no outside automotive industry experience. We have also promoted from
within GM many new senior officers. It is important to our success that the new members of the executive
management team quickly understand the automotive industry and that our senior officers quickly adapt and
excel in their new senior management roles. If they are unable to do so, and as a result are unable to
provide effective guidance and leadership, our business and financial results could be materially
adversely affected.
We have determined that our disclosure controls and procedures and our internal control over financial
reporting are currently not effective. The lack of effective internal controls could materially adversely
affect our financial condition and ability to carry out our business plan.
Our management team for financial reporting, under the supervision and with the participation of our Chief
Executive Officer and our Chief Financial Officer, conducted an evaluation of the effectiveness of the
design and operation of our internal controls. At December 31, 2009, because of the inability to
sufficiently test the effectiveness of remediated internal controls, we concluded that our internal
control over financial reporting was not effective. At September 30, 2010 we concluded that our disclosure
controls and procedures were not effective at a reasonable assurance level because of the material
weakness in our internal control over financial reporting that continued to exist. Until we have been able
to test the operating effectiveness of remediated internal controls and ensure the effectiveness of our
disclosure controls and procedures, any material weaknesses may materially adversely affect our ability to
report accurately our financial condition and results of operations in the future in a timely and reliable
manner. In addition, although we continually review and evaluate internal control systems to allow
management to report on the sufficiency of our internal controls, we cannot assure you that we will not
discover additional weaknesses in our internal control over financial reporting. Any such additional
weakness or failure to remediate the existing weakness could materially adversely affect our financial
condition or ability to comply with applicable financial reporting requirements and the requirements of
the Company’s various financing agreements.
——————————-
Marc M commented:
I will never buy another GM product again.
They blatantly lied in their ad, nothing was done.
They are making billions on a IPO and now not committing to returning OUR money?
They need to go bankrupt and the corrupt UAW which brought GM to where it is today need to all be on the unemployment line.
Empty Pockets commented:
Any non-union automaker will have my sale. Unions had a purpose at the turn of the century, but not any more. They have become fat and bloated making automobile prices fat and bloated. Not just the automakers but all unions are corrupt and bringing our country to it’s knees. Abolish them.
Yeah, right commented:
Someone said it’s like paying off your Visa using your Mastercard. Simply shameless.
Andreas K. commented:
“In January, then-CEO Ed Whitacre promised that taxpayers would be repaid and might even make money on the bailout.”
That statement actually makes me laugh.
Let’s say that they would repay, even with interest. The “taxpayers” wouldn’t see even one cent of it either way. It would all go back to the government, which would quickly waste it on more BS.
Barbara commented:
The French media are convinced that the IPO means Obama’s “rescue” of GM, and failure to reign in the AFL-CIO are proof that socialism works. Betcha you won’t get the French to buy any Volts. They think GM is actually paying the government back – note not the taxpayer. So maddening.
Iconoclast commented:
As one who spent much of his career with OEM suppliers to the automotive industry, I observed at a young age the differences between GM & Ford in their corporate approaches to quality. GM would accept shipments containing varying percentages of non-complying product.
Note – *NOT* saying they knowingly installed defective products, as I am very sure they did not, but rather that they would accept a shipment of 100K widgets even if their incoming inspection observed defective product in a sample.
Ford? “Zero tolerance.” Found a defect? It’s on the truck back to the supplier, at the supplier’s expense and, oh, Mr. Supplier? We have two days of your product on hand. If you shut down our assembly lines, you will pay for that, in full, literally. I bought my first new vehicle after my first six months in manufacturing – and I’ve never owned a GM product, even used. If that kept the UAW a bit less powerful . . . too bad, so sad. No sympathy here, but that is a different story.