Eddy and I are watching the live-stream of the Senate Banking Committee hearings on the bailout. We’ll provide updates as and when. Meanwhile, Automotive News [AN] gets tense. AN reports that GM CEO Rick Wagoner said (read: is going to say) oops, sorry, yeah, I know, we fucked-up [paraphrasing]. “We made mistakes,” Wagoner said in testimony prepared for delivery to the Senate Banking Committee today. GM made many decisions that were ‘right for the times,’ Wagoner said. But the company failed to build enough flexibility into its operations and did not move fast enough to invest in smaller, more fuel-efficient vehicles for the United States, he conceded. Wagoner said the Detroit 3 learned a lot from last month’s “difficult” congressional hearings on their aid requests. For GM, he said, that process accelerated ‘a healthy internal review.'” I’m not going to say it. I’m not going to say it…
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I believe that Christopher Dodd set the tone of the proceedings, supported by the GAO rep who effectively outlined how a bailout could be structured in a way that appears to be friendly to the taxpayer.
My bet is that they will get the money. It would likely be divided into installments, tied to benchmarks and concessions being made by creditors, and include warrants as a sweetener, plus they will pay homage to hybrids, etc., but they are going to get it.
If Wagoner was smart, he would try to hitch his wagon to Ford, and try to separate GM from Chrysler. I believe that sacrificing Chrysler would be a good way to clinch the Republicans, as that would appear to be a compromise, and doing so would make them appear to be selective and deliberate in their approach. But Rick isn’t exactly the brightest bulb in the corporate chandelier.
Pch101 :
Agreed. The hearings have started from the perspective that this is a done deal. BUT…
There’s a certain fat lady who hasn’t sung. And never underestimate the ability of the D2.8 to snatch defeat from the jaws of victory. Did I just say “victory?” Oh brother.
Heres my opinion for GM. There will be a government sponsored reorg outside of a C11. That will be the endgame and GM will shed its liabilities outside of the courts.
“Mistakes, I’ve made a few,
But then again, too few to mention …”
The Chairman of the Board
Geeze Robert – just seeing that endoscope makes me shake with fearfull memories.
GO AWAY RICK. the $4B we need is the same amount you blew on Fiat. run and hide you miserable SOB.