Manny Lopez is the guy in charge of auto coverage over The Detroit News. And it looks like the paper’s Head Cheerleader has pommed his last pom. “Failing to match revenue with expenditures or supply with demand has pushed Detroit’s automakers to the brink of extinction in varying degrees. Certainly, layoffs, plant closures and restructuring plans are steps in the right direction, though they’re long overdue and unable to make a significant difference today.” Uh-oh. Lights out, Manny? Of course not. Even the title of Manny’s dietribe [sic]– “Repairs to auto industry can’t wait”– promises RX for Motown. And make no mistake: the scribe knows the stakes. Well, he knows someone who does. “‘Too many people, falsely, think the auto industry doesn’t matter to them or their state. And they’re dead wrong. It matters to every state,’ U.S. Rep. Joe Knollenberg, R-Bloomfield Hills, told me Tuesday. ‘It matters to America. The saying is still true: What’s good for GM is still good for America.'” OK, Manny, fire away. What should your hometown heroes do to pull the fat from the fire. “He’s absolutely right, but America won’t care until we fix what ails us here, first. And we’ve got to find a way to do it today, not tomorrow.” Yes, yes. What now? Manny? Manny? Hello?

We have it from a private source close to someone familiar with the story who heard it from a friend who heard from a friend that you’ve been messing around GM has some [more] bad news to release this Friday. Of course, given GM’s m.o., that’s a bit like predicting it’ll be “partly sunny with a chance of showers.” We’ve been calling-up the usual suspects to try and identify these not-so-glad tidings– to no avail. (Hey! What a great name for a Chevy!) But we’re getting closer. Deep Throat heard of our puzzlement and sent us a link to this story from Bloomberg. Seems one General Motors is getting ready to axe some damn thing, or a bunch of some damn things, in advance of its third quarter financial report (BIG owee) and next Friday’s announcement (we hear, also from a person familiar with this kind of shit) of the Chrysler merger. “General Motors Corp. may initiate a new round of cost cuts because a planned $15 billion in asset sales and savings won’t be enough to maintain its liquidity amid deteriorating sales, people familiar with the matter said.” Our equally unidentifiable but totally credible guy says “I think the bad news on Friday is more job cuts at GM and possibly the end for some products like the Solstice/Sky. Since the dealers were told to expect some bad news on this date, it has to be some product cuts. Run through last months sales report and pick out the obvious weaklings. DTS? STS? SRX? Hybrid trucks? Saturn Astra? Buick LaCrosse?” Sad to say DT, it could be just about anything that GM makes.

What with all this End of Days news swirling around the autoblogsphere, you’d kinda hope that Detroit News columnist John McCormick could find something useful to say about the plight of his hometown heroes. And he does– if you’re a Big 2.8 auto exec. Yes, McCormick’s column inches are devoted to a simple message: buy a Chevy Traverse, Dodge Journey or Ford Flex! If it wasn’t so tragic, Big Mac’s lead could be considered comedy gold. “It seems like Detroit’s automakers can’t get an even break. Just as General Motors, Ford and Chrysler are launching vehicles better tuned to the needs of American consumers slammed by high fuel prices and a soft economy, the world plunges into a massive financial crisis. Now with mounting monetary pressures, the very existence of some automakers is in question. Meanwhile, consumers, even if they are in the mood to buy a vehicle, struggle to obtain financing because of the interbank credit freeze. It’s all very troubling, yet at the same time for those plucky enough to head to dealer showrooms, the Big Three have some excellent vehicles in their lineups and more on the way. And while the present slump in the price of oil should not be seen as a permanent trend, today’s relatively cheaper gas does bring certain larger vehicles back into contention. Consider, too, that Detroit-area dealers are probably more eager than ever to work with buyers to complete a sale.”

Now tell us something we don’t know. “Such an investment would be along the lines of Warren Buffett’s recent purchases of minority stakes in General Electric and Goldman Sachs, The Financial Times reports. “While private investors are searching for ways to deploy capital through minority investments, many such deals, including the capital infusion by TPG into Washington Mutual, have struggled or failed.” In other words, good luck with that. “One banker questioned GM’s chances of finding an outside investor. ‘I just don’t think most private equity guys are that enamoured of the auto industry and I don’t know how you could try to secure it in some way.'” And check this: GM’s friendly neighborhood automotive analyst, JPMorgan’s Himanshu Patel, says sliding sales in North America and Europe make 2009 “uniquely painful” for the Big 2.8. “Mr Patel expects GM’s cash outflow to reach $12.4bn next year compared with his earlier estimate of $7.9bn. Such a drain implies that GM will breach the mid-point of its minimum required cash reserves of $11bn-$14bn by mid-2009.”

We’ve just received a press release from GM announcing that it’s “exploring a potential sale” of aftermarket parts maker ACDelco. Apparently, “a sale is expected to promote more rapid growth of ACDelco globally.” The move is painted as a logical outgrowth of “a number of initiatives to bolster [GM’s] liquidity position by approximately $15 billion through year-end 2009, including the sale of assets which are expected to generate approximately $2-4 billion of liquidity.” In other words, we told you we were throwing furniture on the fire, and there you go. Equally unsurprising, GM hasn’t revealed the amount of money it wants for ACDelco. And GM is, once again, paying Merrill Lynch to do the dirty work. You may remember that Merrill arranged GM’s billion dollar payoff to FIAT for NOT buying the Italian automaker, and then bought GM’s abandoned shares for pennies on the dollar. If not, you should.

The former PR spinmeister currently writing under the Autoextremist moniker has long been one of Detroit’s most fervent not to say (’cause that would be rude) ardent supporters. No more. Peter DeLorenzo has put down his pom-poms and finally faced the truth about both GM and Chrysler. “GM’s foray into the idea of a Chrysler takeover exposed that company’s dire situation for all to see. Burning through cash at a prodigious rate – a little more than $1 billion per month according to estimates – GM’s search for crucial financing is getting beyond desperate at this point, and now everyone knows it… GM’s situation grows more precarious by the moment, and if they don’t make a deal for that much-needed infusion of cash soon – in the next 12 months, preferably less – then we could be contemplating the unthinkable. And that means not only the end of GM’s 100-year reign as the largest American car company and one of America’s historical industrial touchstones, but the end of General Motors, period.” As for Chrysler…

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We’ve been largely ignoring this possibility because, well, the GM – Chrysler merger thing is a much more appealing possibility, in that “how nuts do you have to be to be a top executive for a domestic car company” kinda way. But now that it’s OK to write news reports based entirely on anonymous sources, well, why not Chrysler – Nissan? I mean, Chrysler – Nissan – Renault? I mean, Carlos “The Jackal” Ghosn?  And The Detroit News is there! “The Renault-Nissan alliance is proposing to acquire around 20 percent of Chrysler LLC and bring the Auburn Hills automaker into the French-Japanese automotive partnership, according to sources familiar with the situation… Sources familiar with the discussions said Carlos Ghosn, CEO of both Renault SA and Nissan Motor Co., sent a proposal in recent days that included revisions to a draft agreement prepared by Cerberus… The sources said Tokyo-based Nissan would acquire the stake because it has cash on hand, whereas Renault now has debts of more than $5 billion.” So, which company does Cerberus favor to gut Chrysler like a fish? Go ahead and jump.

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JP Morgan Chase (JPMC) owns enough Chrysler paper to line the inside of the New Orlean Superdome. Not to mention a stake in GM. Hey! You don’t think… yes we do. And the fact that automotive analyst Himanshu Patel works for JPMC is more than slightly relevant when it comes to considering his opinions on said merger. Only not to Bloomberg’s Hyman, who presents his “Hell yes!” take on the merger without once mentioning the connection. “By saving Chrysler from a liquidity even, GM may also be able to get itself much needed secured bank financing,” the graphic reads. But wait, that’s not all! Patel also reckons the combined company would have more leverage over the United Auto Workers (they’re gonna need it). “Inicidentally” the news reader concludes, “Patel is the only one of the analysts who covers General Motors who has a buy rating on the stock.” Gee, I wonder why…

Remember when the Chevrolet Malibu was the Next Big Thing? Or what about the Cobalt, GM’s small car superstar? You know: “we can’t build these cars fast enough!” Well, guess what? They can. USA Today reports that union officials at Orion Township (MI, Malibu/G6) and Lordstown (OH, Cobalt/G5) reports The General has banned overtime at both factories. Maybe more. What’s unscheduled overtime, you ask? “Unscheduled overtime generally is used when a worker calls in sick. An employee who is on duty at the time usually works half the shift for the sick employee, and another worker is called in early to work the other half. The union officials were unsure how the company would fill assembly line positions for those who are ill.” Meanwhile, shhhh! “Officially we haven’t told employees anything,” GM spinmeister Tony Sapienza told the former McPaper. “As we weather very difficult economic conditions, we’re looking at a variety of ways to be as efficient as possible while balancing the needs of the market for our products.” Translation: Somebody stop me! We’re buring through a billion bucks a month. “Several analysts predict that GM will burn up so much cash that it will reach its minimum operating cash level of $14 billion sometime next year.” Just in case you haven’t been paying attention.

Bloomberg reports that Toyota has sold more cars in China than GM over the first nine months of this year. Sales at GM’s biggest Chinese venture, Shanghai GM, have been down two years in a row, while Toyota sales have grown at about triple the market average since opening a new Chinese Corolla plant last year. GM has long been the number two automaker in China, trailing only China pioneer VW/Audi for over a decade. (Quite an accomplishment when you consider war-born Chinese antipathy to all things Japanese.) The General’s ouster from the second highest sales spot couldn’t come at a worse time for GM. “China is very important to GM and losing share there makes life even more difficult,” said Daiwa Associate Holdings analyst Ricon Xia. “Japanese automakers know how to make cars for Chinese consumers and they have been expanding in China at a very steady pace.” Needless to say, passing GM in China means Toyota is that much closer to finishing the year as the top-selling automaker in the world, replacing GM after decades of dominance. With growth in the Chinese market slowing, GM will also have fewer opportunities to regain ground on Toyota, who opens yet another giant factory in Guangzhou province next year.

Yahoo! Finance reports that Michigan Representative Thaddeus McCotter has joined State Senator Carl Levin in suggesting that the GM – Chrysler merger is something that really ought to happen, even if the feds have to, uh, help. A Republican suggesting government intervention to broker a deal (i.e. kick-in your tax money) between two large corporations? Sure! “I would be supportive of anything as long as it guarantees people the opportunity to vote for me keep their jobs so they can vote for me so I can keep mine.” In fact, Tad’s “biggest concern” is “if there’s not a merger.” “If there is no merger you could see the entire Chrysler car company destroyed, disbanded and thousands of Americans put out of work.” Which is also true if there is a merger, but as they say, a week is a long time in politics. Anyway, check out the video interview on the page; Tad’s got a terrific little wiggle as he explains the difference between being a capitalist and a “free market supporter.” [thanks to Steven Lang for the link]

Automotive News [sub] reports that billionaire investor Kirk Kerkorian has sold part of his 6.5 percent stake in Ford Motor Co. and could sell the rest before this blog hits the net. This according to spokesfolk for Kerkorian’s investment “vehicle” Tracinda Corp. “Tracinda, which has invested about $1 billion in Ford, said in regulatory filings it sold 7.3 million Ford shares on Monday in the open market for an average price of $2.43 per share. Tracinda intends to further reduce its holdings, including the possible sale of all of its remaining 133.5 million shares, or about a 6.09 percent stake, depending on market conditions and available sales prices.” Hang on; is this the same Captain Kirk who offered a cash infusion to FoMoCo in June? The same Lion of Las Vegas who, according to last Friday’s Bloomberg report, “pledged another 50 million MGM shares to back the $600 million Bank of America Corp. credit line he used to buy into the second-largest U.S. automaker?” Yup. There’s at least one analyst and an investor with a massive egg on their respective faces…

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There’s a reason the headline above attributes this “story” to The Detroit Free Press. Let me put it this way: “people familiar with the situation,” “one of these people added,” “other observers,” “one person told the Free Press,” “a person briefed on the talks,” “several analysts have speculated,” and “a person briefed on the strategy.” Seven references to unnamed sources? That’s gotta be some kind of record– and not for reputable journalism. OK, be that as it may, The Freep is asking us to believe that there’s method to this banker-lead executive hysteria. “If a merger is consummated, Chrysler’s brands would become just like Chevrolet, Pontiac and Buick, people familiar with the situation tell the Free Press.” And that’s a good thing? “Conflicting brands could be dealt with in a few years after this industry turmoil has passed, one of these people added.” Later. Got it. “Another concern raised by analysts and other observers regards the addition of 3,500 Chrysler dealers into GM’s already over-dealered network. One person told the Free Press that those ‘excess dealers’ would cost GM nothing in the short-term and that some — if not many — will fail on their own anyway.” Later. Got it. Of course, Ace scribe Tim Higgins has more conjecture information on GM’s thinking…

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You may recall that we gave Jim Cramer shit for voting for GM’s stock before he voted against it. Yesterday, while listening to my local talk radio financial advice show… sorry, what was I saying? Right. I’m awake. I’m awake. A caller asked if they should buy GM stock, ’cause you know it used to be a 40 and now it was at 4 and wow such a deal. The expert said Hell no; GM was going to be broken-up and/or go bust. As the Autoextremist might say, that’s a barmitzvah-sized coffee urn of not good. When TTAC started the Death Watch, the experts were singing a different tune. And the General’s public knew nothing– as in zilch– about its troubles. Now that the financial crisis has hit the mainstream press, GM’s distress is an open secret. How long before the possibility of C11 affects new car sales? Maybe not now, but soon. Meanwhile, there are plenty of people either ignorant or willfully ignorant of what’s going down at GM (hint: GM). Here’s a comment from Al “Who He?” Diaz over SocialPicks.com (“Invest Smarter Together). Oh, Al reckons GM’s a buy. “I have confidence GM will make necessary adjustments to ensure the merger with Chrysler goes through by the end of October; ensuing cuts WRT Plants and other hourly wage earners should help the company get back on its feet and in time the fruits of their labor will become apparent. I don’t see GM going out of business anytime soon.” But when he does…

No surprise there. But it’s nice to see someone else noticing that GM’s repatriating profits from foreign ops to keep the corporate mothership alive. [Note to GM’s BOD: we’d love to see some hard numbers on that.] That someone is Bertel Schmitt. I’m not sure where Berty gets his info, but the CEO Sinamotive Group (HK) Limited writes, “Bob Lutz, GM’s vice-chairman, said GM is making plans to move money from Chinese operations to the U.S. in order to compensate for North American losses. Since nobody seems to want to buy the Hummer brand, which GM put up for sale, repatriating profits from China is one of the few options left for GM. Draining the huge, vibrant and growing China market of funds while the rest of the world tanks doesn’t sound like such a good idea, but these are desperate times. ‘We do not rule out such a possibility under current conditions,’ Lutz said. (Translation: We are already preparing the transfer.) The withdrawal will not sit well with GM’s joint venture partners. When cash is king and credit is an endangered species, cashing in will be extremely unpopular.” Oh, did we mention that Chinese auto sales have stalled, and GM’s share of same has diminished? Seems churlish, but there you go.