Thanks to congressional arbitration, GM’s dealer cull has been steadily downsized since The General made the decision to axe nearly 2,000 dealers during last year’s bankruptcy. Going into bankruptcy, GM had about 6,000 dealers nationwide, and it culled nearly 2,00 of them in an attempt to lean out its distribution channels. But now the Detroit News reports that GM’s North American boss Mark Reuss has said that about half of those culled dealers will have been reinstated by this July, bringing GM’s dealer count back to the 5,000 ballpark.
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With a GM IPO in the fourth quarter of this year looking more likely than ever, GM has revealed just how much its top management stands to gain from the automaker’s post-bailout share offering. Based on trading of Motors Liquidation bonds, which GM will convert into stock and warrants, a JP Morgan Chase report pegs the company’s value at $70b. Based on yesterday’s bond trading prices, however, BusinessWeek estimates new GM’s value at $48b. With a float of 500m shares planned, that puts GM’s current stock price at about $96/share. With that in mind, let’s take a quick look at GM’s planned executive stock compensation.

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On Wednesday, June 9 2010, the German government will decide whether they’ll grant Opel live support. Or whether Berlin gives Opel a pat on the head and best wishes for their future endeavors. That’s the current plan, says Die Zeit, based on reports by the German wire service DPA. Plans can change, as they did in the past.

It looks grim for Opel. (Read More…)

GM and Ford reported new monthly record sales in China, says the usually reliable government-owned China Daily. Really?

Ford said its China sales rose 17.8 percent. Ford is a relative nobody in China. File under “never mind.”

GM China’s May numbers are much more remarkable. They need to be carefully read. Tread carefully: Cleverly hidden landmines ahead! (Read More…)

The executive shake-ups show no signs of stopping at GM, as Ed Whitacre ended the week with yet another re-shuffle. And this time Whitacre himself is the big winner. Automotive News [sub] reports that Whitacre has assumed control of GM’s global product planning, leaving former planning boss Tom Stephens with the more prosaic responsibility of overseeing new product development. Whitacre will be assisted by new VP for product planning Steve Carlisle, who, unlike Whitacre, actually has some experience in product planning. Carlisle replaces Jon Lauckner, who will head up GM’s new venture capital unit. But the big news here is that a man who only just learned the term “segment” about five and a half months ago, is now in charge of GM’s global product planning. Quick learner or egomaniac?

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If anybody would offer me Nick Reilly’s job, I would scream. I don’t have the nerves the assignment takes. Yesterday, Opel made headlines for losing 51.5 percent in May. In today’s mass publication BILD Zeitung, there is even worse news: (Read More…)

GM has announced pricing on its next small thing, the Cobalt-replacing Cruze compact, and the new price of entry is $16,995. That’s about a $2,000 premium over the base Cobalt (which starts at $14,990), a price hike that is justified by Chevy’s high expectations for the Cruze. As Chevy’s Jim Campbell puts it

For the price of a compact car, Cruze offers the styling, safety features, roominess, amenities, and refinement of a much more expensive car.

Base prices for the Cruze’s main competitors are $16,200 for a Corolla, $16,415 for a Civic, $16,095 for a Mazda3, $16,170 for a Sentra, $17,040 for a Focus, $178,485 for a Jetta, $14,865 for an Elantra, and $14,390 for a Forte (including typical destination fees).

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The new Buick Regal is aimed straight at Acura’s TSX… could this forthcoming Opel Astra Coupe be Buick’s answer to the late Acura Integra/RSX? GM has thus far refused to confirm any Astra-based Buicks besides a sedan that’s already being caught without camo in China. But if Buick is going compact, where should it draw the line? After all, the brand is anxious to attract young buyers… but does a compact coupe take Buick’s youth movement too far? And what do you call a Buick coupe that could fit under the hood of a classic Riviera? Rebadged Opels and younger buyers are a solid basis for a Buick revival, but cars like this one prove that Buick needs more than just a direction to head in: it needs a vision.

Automotive News [sub] reports that GM has made a bold new request of its suppliers: to assume responsibility for 50 percent of all warranty costs. The move comes as GM overhauls its post-bankruptcy supplier relations, which includes previously-announced measures to share cost-savings between GM and its suppliers. The obvious question when that plan was announced was: how do you stop suppliers from cutting all the quality out of GM components? The answer to which is apparently “by making suppliers share warranty costs.” But the solution is by no means a done deal…

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Technical experts analyzing GM’s request for $1.35b in Opel aid from the German government have reported back, and the signs aren’t looking good. According to the Financial Times, the experts advising a political committee that will rule on Opel aid next week returned a negative outlook on The General’s request. German officials tell the newspaper that

the technical experts’ stance was “formally not a complete No” but that it “meant No in practice”

GM is requesting €1.9b in loans for its €3.7b restructuring of Opel. Though it looks like the €1.2b ($1.35b) it is requesting from Germany will be turned down, some portion of that amount might still be awarded by local German state governments. If that scenario plays out though, more employment cuts could be in order for Opel’s German production staff.

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One year ago today, General Motors took the “unthinkable” step of filing for bankruptcy. It was a seminal moment in the history of the American auto industry: the day that once-dominant GM finally shed its illusions, faced up to reality, and plunged into the cold, cleansing waters of bankruptcy reorganization. Or, to use a more accurate metaphor, it was pushed in. After decades of decline masked by decades of PR-driven denial, GM had literally lost the ability to self-correct.

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The Detroit News reports that the Treasury Department has hired Lazard Frères & Co. as an advisor to GM’s forthcoming IPO sale. And with news of the hiring comes confirmation that GM’s IPO really is coming soon: the investment bank will receive half a million dollars, according to the DetN, but that amount will drop to $250,000 if the IPO isn’t completed within one year. If you’re one of the GM boosters who believes that an IPO will repay all or most of the government’s investment in GM, it’s time to start saving those pennies. You have less than a year now to put your money where your mouth has been.

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As yesterday’s sales graph proves, this is not the greatest time to be re-launching an entry-luxury brand. With Kias and Fords offering the kind of tech gadgets once found only in the upper echelons of true luxury brands, and with well-regarded import luxury marques moving into the front-drive, mass-market, the so-called “premium” brands are finding themselves caught in the middle and losing sales. But in spite of these damning dynamics, GM is moving to overhaul its entry-luxe Buick brand at top speed. Why? Because it can…

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No details yet, just an Inside Line confirmation from GM’s Karl Stracke that a seven-seat, Lambda-platform crossover “is absolutely a go.” It has long been rumored that the Cadillac Escalade would be replaced by a Lambda-platform crossover. The Cadillac crossover will join the Buick Enclave, Chevrolet Traverse, and GMC Acadia, as the Lambda becomes the only platform shared by all four of the General’s “core” brands (and previously, the Saturn Outlook as well).

GM’s plan to develop an electric version of its (previous-generation) Chevrolet Spark city car for developing markets had been dependent on a joint development deal with REVA, the Indian firm responsible for such vehicles as the REVAi (known to Brits and Top Gear fans as the G-Whiz). But with the AP [via BusinessWeek] reporting that Mahindra & Mahindra has bought a 55 percent stake in REVA, GM’s deal to use REVA’s technology in its Daewoo-developed hatchback appears to be off. GM had already scaled back its cooperation with REVA, delaying the planned release of the Spark EV and focusing on fleet testing the car. But, says GM India President Karl Slym

Now we’ve stopped the test fleet as well. We were doing it purely as something to learn. Now there’s no real benefit to that. We may as well stay with the GM solutions.

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