General Motors is is “open to considering moving its headquarters from Detroit, selling off U.S. plants and even renegotiating parts of its restructuring plan with its major union,” CEO Fritz Henderson told Reuters today in a conference call. The possible relocation and renegotiations are part of a last-ditch effort to restructure GM outside of bankruptcy, a move that Henderson admits is likely to fail. “It’s more probable that we would need to accomplish our goals in a bankruptcy,” says Henderson. “There’s still a chance for it to be done outside a court proceeding.”
“As we look at the structure, look at the business, we’re looking at everything, particularly as we slim,” Henderson said. “At this point, I don’t have anything to report. We don’t have any such plans, but if we did it would be motivated by business rationale, which would be cost-efficiency and speed.” The UAW has already criticized GM’s plans to cut US production levels. GM’s current restructuring plan calls for 21,000 job cuts for GM’s US workforce.
On the dealer front, Henderson has said that GM’s plan to cut 2,700 sales outlets would be put into effect later this week. “We would try to work with our dealers for an orderly wind down,” said Henderson. GM is offering to buy back signage, tools and unsold inventory from its dropped dealers, but there are major questions surrounding GM’s ability to make these cuts outside of bankruptcy. In a guest column for Automotive News [sub], dealer law specialists Dan Myers and Loula Fuller advise dealers to “remember that just because GM targets you, doesn’t mean it can carry out the plan.”
Just as I predicted.
Well, How about a wild idea ???
Move in with Chrysler !!
They have alot of empty space….
Chrysler can charge GM rent…
It’s the 2008 version of Neil Simon’s “The Odd Couple” !!
This is insane.
So why in the f@#$%& should the government inject more money in GM?
They will move to Venezuela, only to be nationalized by Chavez and given to IKCO as partner.
This guy should be fired faster than Mr. Wagoner.
GM is smelling more like a C7 than a C11.
I wonder if there are some vacant offices in this building? http://www.nissannews.com/newsrelease.do;jsessionid=5698EA36FB4DE9BB5EC7378904AE3C5D?mid=1&id=520
They are moving to 1601 Pennsylvania Ave., Washington DC, so they can be near their CEO.
Polishdon asked:
“Well, How about a wild idea ? Move in with Chrysler!”
Doesn’t seem like such an outrageous idea to me. Plenty of space although there might be a problem allocating choice executive offices that command better views.
And, it’s not as if the Diminished 2 are going to experience a need for additional space in the future.
Robert:
There goes the frickin’ neighborhood!
Who in their right mind would not want to leave Detroit?
Henderson at least makes an effort to sound less ostrich like than Wagoner ever did. Outside of Detroit, and perhaps especially outside immediate reach of US regulators and lawyers, GM might actually have some net value. It’s about time they got a CEO making at least tacit efforts at unlocking it.
If GM actually go through with this (unlikely, as I can’t see anyone even fronting them enough money for a moving van), perhaps the “Michiganders who once thought they had pensions to retire on” ™ would consider getting themselves a government capable of attracting employers, rather than driving them all away.
Now that the charade surrounding a “possible” bankruptcy has been laid bare, I’d be surprised if GM’s top management wasn’t giddy with the prospect of utilizing this “once-in-a-lifetime” lifeline to reshape the organization. None of us could have ever foreseen that this industrial colossus would ever have toppled, but the moon finally turned blue, animals of a porcine persuasion have taken flight, and the subterranean penalty box guarded by the 3-headed dog has finally frozen over. Everything should be on the table, despite how painful the decisions will be to suppliers, creditors, and employees. Although it’s too soon to say that the UAW has been effectively neutered, it’s possible that the biggest fight of all will be the one involving off-shore production at the expense of domestic jobs. In this fight, there is everything to lose and the bare-knuckled fight that ensues will test the mettle of both sides.
If GM actually go through with this (unlikely, as I can’t see anyone even fronting them enough money for a moving van)…
This is a strong hint that GM is about to be acquired, in the sense that Fiat is acquiring Chrysler. GM won’t be staying in Detroit because the buyer’s HQ is not located in Detroit.
Why not ask the UAW where the HQ will be? They will end up owning the company anyway.
Re Robert Schwartz :
They are moving to 1601 Pennsylvania Ave., Washington DC, so they can be near their CEO.
So funny it hurts…because it’s true.
Polishdon: “Well, How about a wild idea ??? Move in with Chrysler !!”
Not a bad idea. Lots of empty space; phone and computer cables already in place. One of the tech centers could be sold. It’s not like the two companies have any valuable secrets to hide from one another.
But we’ll know GM/Chrysler/American Leyland are really serious about trimming expenses when they emulate Wal-Mart. It’s one of the world’s biggest corporations, but the headquarters is in low-rent Arkansas and the building looks like a SuperCenter.
They are moving to 1601 Pennsylvania Ave., Washington DC, so they can be near their CEO.
Very funny, Robert, but slightly cynical if you ask me. The real reason they are moving to Washington is to get within walking distance of the ATM.
eyeonthetarget
None of us could have ever foreseen that this industrial colossus would ever have toppled, but the moon finally turned blue, animals of a porcine persuasion have taken flight, and the subterranean penalty box guarded by the 3-headed dog has finally frozen over.
Assuming you are not alone in that belief, that is one scary statement.
The first step to recovery is to admit you have a problem. Fine. But then you have to accept responsibility. As in accountability. As in blame. You know: recognize your own role in the disaster you created. Admit same. Both to yourself and those you’ve aggrieved.
Henderson is more than not a part of the solution. He is Wagoner’s hand-picked successor. An integral part of the team that brought GM to its knees. Unless I’m missing something, this is not a “My Name is Fritz” moment.
Here’s a freaking wild idea: GM declares bankruptcy,transfers pension benefits to the government’s Pension Guarantee Corp. and moves their headquarters to China and export automobiles to the United States! GM’s products are wildly popular in China, their labor costs would be a fraction of what they are under the UAW and they would have far fewer of those pesky rules and regulations to follow. Let the dust settle, and GM could re-enter the domestic market building assembly plants in the South and employing low cost non-union labor.
Perhaps this is code speak for the idea of moving to China.
We might end up with Chinese cars in the US, made by GM in China.
The new 800 million dollar building on the Warren Tech Center Campus (part of a 1.2 billion dollar recent project) sounds like just the place to consolidate design, engineering and World HQ operations.
After all, the building is built, it’s only 15 miles north, and there’s been lots of space that’s opened up in those offices with job cuts lately.
And Warren will actually work with GM, and not punish them, when it comes to property taxes.
You heard it here first.
One reason for GM’s new masters to stay in Detroit. Cheap housing, even cheaper with Euro exchange rates.
One reason for GM’s new masters to move them. Cheap housing.
One other reason, a line from the film “Kentucky Fried Movie.” The line, from a send up of Bruce Lee’s “Enter the Dragon” is…
“Take them to Detroit!”
“no, NO-O-O-O, Anything but that!!”
Comerica Bank moved to Dallas a couple a years ago from Detroit… I’m sure we can find some room for GM here in the Lone Star State:)
@Polishdon
Chrysler is already paying rent.
Chrysler doesn’t own its headquarters. It is paying rent to a shell company controlled by Cerebus. Cerebus separated the headquarters from the company at the purchase from DiamlerChrysler. Part of the “harvest” from Chrysler.
Moving the HQ to the Warren Tech Center would be relatively easy…lots of unused space out there.
The new 800 million dollar building on the Warren Tech Center Campus (part of a 1.2 billion dollar recent project) sounds like just the place to consolidate design, engineering and World HQ operations.
After all, the building is built, it’s only 15 miles north, and there’s been lots of space that’s opened up in those offices with job cuts lately.
And Warren will actually work with GM, and not punish them, when it comes to property taxes.
That can be left in the Bad Company GM, and sold off to pay creditors.
One basic rule of thumb for business — the HQ will end up being located in the place that is most convenient and pleasing to the senior executive who is making the decision.
Carlos Ghosn personally likes the southeast, acquiring a taste for the area when he was based in Greenville, SC during his time with Michelin. It’s not just the operating costs, he just personally likes being there.
I can’t see a Nissan-operated GM staying in Michigan for long. He moved Nissan’s HQ out of California as soon as he had the chance, even though there were logical reasons to keep the company there. It’s good to be the king, or so I’m told.
Great idea. Just like everyone does in India when the workers get too needy.
“Well, How about a wild idea ? Move in with Chrysler!”
Oh, sure, like Cerberus needs more money.
If GM were to pack up, shut down North American operations and fire its unionists, and relocate to China … that would be so ironically hilarious it would make this whole multi-billion dollar black hole worthwhile.
GM to Detroit (maybe Michigan): thanks for your help and cheerleading. Now, f*ck you!!
It wouldn’t be politically correct for GM to move out of Detroit. Besides who would buy the RenCen? It took Ford decades to find a sucker to unload the RenCen on.
Although it’s too soon to say that the UAW has been effectively neutered,
The UAW will own 39% of the restructured GM. If that’s effective neutering, the vet needs a sharper scalpel.
4 years ago, GM could have driven a heckuva deal by floating a proposal to move the HQ to one of 3 or 4 low-tax states and waiting for the incentive bidding to play out. Major company headquarters are at least as valuable as sports franchises, and GM could have saved a bundle by moving. Now, I fear that the ship has sailed for GM to do this on its own. No state or local government is going to spend any money to get this company to move, given its current state. Everyone in government finance is by now familiar with how Tipton County, Indiana got hosed by Chrysler & Getrag. The government put up a bundle of money, and the plant that was to be a joint venture to build a new transmission design got to 80% done and stopped, never to be finished. This small county has lost a bundle and gotten nothing in return.
The only way this company moves now is if somebody else is pulling the strings.
This is a strong hint that GM is about to be acquired, in the sense that Fiat is acquiring Chrysler. GM won’t be staying in Detroit because the buyer’s HQ is not located in Detroit.
I don’t see it. GM actually has products that sell and very good assets particularly in intellectual property. They haven’t been stripped and flipped as Daimler did with Chrysler. I wonder though about their future given all the brain power that’s been layed off. Any acquisition would have real competition IMO.
Also, assuming someone like Toyota or Nissan has real interest in some parts of GM, I’d think they would do better to wait until the dust settles and the new going concern has trouble going. Then make offers for what they want.
It wouldn’t shock me if GM was able to collapse it’s NA operation and leave the country completely.
No one will pay a profitable price for their product in this country (not even the fanboiz).
Wouldn’t that be a nasty little mess for the Washington spinmeisters?
BTW, I don’t thinkit would really happen, doubt Fritz is that innovative of a thinker or he would not have survived at GimMe.
Bunter
Well, Mr. Reesler has, in the past, championed the notion that the D3 make bad cars because Michigan is a an unatractive place to live. (I won’t attempt a defense, as I’m biased – though I’d not Honda makes damn good cars in OH, and if you’ve ever been to OH, you’ll know it’s not a hell of a lot better than MI)
So, this will give us an opportunity to test the theory. Perhaps the cars will suddenly become better because the HQ moves to SC.
Kind of funny, kind of sad, but even if GM and Chrysler survive bunkruptcy, Ford may, in fact, be the only American auto manufacturer left. I bet companies like Toyondassan are just waiting for GM to be purchased by a Chinese group.
Poor GM, if only you had shown some hope of progress after billions of dollars, I might have felt sorry for you.
Maybe Ford was smart to have unloaded the RenCen a while back to GM and maybe GM now wants to move near VWoA which is nearer to their real CEO by the name of Barack Obama……but will their move really matter if they really intend to produce more vehicles outside of the USA anyway? Time to cue up the old Steely Dan album “The Royal Scam”!
here’s a snippet from a recent VW P.R…….
Volkswagen of America, Inc.
Founded in 1955, Volkswagen of America, Inc. is headquartered in Herndon, Virginia. It is a subsidiary of Volkswagen AG, headquartered in Wolfsburg, Germany. Volkswagen is one of the world’s largest producers of passenger cars and Europe’s largest automaker. Volkswagen sells the Rabbit, New Beetle, New Beetle convertible, GTI, Jetta, Jetta SportWagen, Eos, GLI, Passat, Passat wagon, CC, Tiguan, Touareg 2 and Routan through approximately 600 independent U.S. dealers. All 2009 Volkswagens come standard-equipped with Electronic Stabilization Program. This is important because the National Highway and Traffic Safety Administration (NHTSA) has called ESC the most effective new vehicle safety technology since the safety belt. Visit Volkswagen of America online at vw.com or http://www.media.vw.com to learn more.
“GM is offering to buy back signage, tools and unsold inventory from its dropped dealers,”
That’s some splendid cost saving measures there. About as good as buying out all those Oldsmobile dealerships. And selling off GMAC which kept GM afloat for many years… GM would operate on a constant yearly loss and GMAC would turn a profit every year. And they sold it!
What if the Corvette plant was a stand alone company? Could it by itself stay in business?
What if GM only made cars in places where they make them profitably and imported them back here? Could they be competitive? What if they just shut down their North American operations and relocate the corporate headquarters out of the country? Could they turn a profit in other countries?
They used to build T.V.’s in America and you all know how that turned out. Are T.V.’s built in America? Do American’s buy T.V.’s. The car situation is no different.
It’s like when Circuit City went under; Best Buys business increased.
Wall Street vs. Detroit kinda reminds me of PETA v. Michael Vick. Just like how people will soon remember they hate PETA more than Vick, Wall Street will soon remind us all who the real villains are. Don’t believe the stress test hype. These sorry fools losses could be in the trillions.
What do we build in this country?
At least OCP can now buy the old factories (cheap) and start manufacturing the Robocop units…
Wall Street should be burned to the ground, never to be resurrected. Those greedy bastards sold their souls, and unfortunately, yours and your children to the devil, but you got poor and they became wealthy in the transfer.
There was a simpler time when if someone like a company and its products, they invested money directly with the owners.
And then, the rotting, stinking, greedy ugliness of Wall Street was invented, with its millions of rotting, stinking, greedy, soulless henchmen.