Replies to This Discussion

Permalink Reply by David Ruggles on March 3, 2010 at 12:05pm

So where are they getting the money to finance these competitive vehicles? Are Chrysler dealers properly taken care of? Will GMAC be financing Hondas? Are they using TALF money to advertise higher than market rates to attract deposits in competition with other non TALFed financial institution?

In the meantime, GM is pumping over a billion dollars in new investment into GM Europe. Aren't these taxpayer dollars? I'm mystified as to how all this is supposed to work, but there are things that don't sound right!

Then Whitacre presides over another exec shakeup sending Brian Nesbitt back to design, opening up space for a new head of Cadillac. Nesbitt failed in 7 months? Nesbitt didn't decimate Cadillac's dealer base, he inherited that. It looks like Whitacre is flailing and churning, and it isn't confidence inspiring to me. How about the folks he needs to have a successful IPO? Won't they need to have some confidence to invest in GM? This guy knows just enough to be dangerous.

And then, we have the father of the dealer terminations, Steve Girsky, named to GM's board of directors. Considering Whitacre seems to want about a 1000 dealers back through the arbitration process, one wonders if they are totally in tune. Things are becoming curiouser and curiouser, but I gave away my monthly column.

But I'm just stumped!

Permalink Reply by JJ Hornblass on March 3, 2010 at 12:47pm

To answer some of those questions:

Money for financing appears to come from Ally Bank, the capital markets, and TARP.

GMAC/Ally will in fact attempt to finance Hondas, for example.

The TARP (not TALF) money is buried within the company's capital structure, so you can probably infer that some of it technically is being "used to advertise higher market rates to attract deposits," but largely the TARP funds support GMAC's troubled mortgage book, giving it enough capital to not require liquidation based on the valuation of assets the market is giving the company.

As to Whitacre's "flailing," I like the image, David.

David Ruggles said:

So where are they getting the money to finance these competitive vehicles? Are Chrysler dealers properly taken care of? Will GMAC be financing Hondas? Are they using TALF money to advertise higher than market rates to attract deposits in competition with other non TALFed financial institution?

In the meantime, GM is pumping over a billion dollars in new investment into GM Europe. Aren't these taxpayer dollars? I'm mystified as to how all this is supposed to work, but there are things that don't sound right!

Then Whitacre presides over another exec shakeup sending Brian Nesbitt back to design, opening up space for a new head of Cadillac. Nesbitt failed in 7 months? Nesbitt didn't decimate Cadillac's dealer base, he inherited that. It looks like Whitacre is flailing and churning, and it isn't confidence inspiring to me. How about the folks he needs to have a successful IPO? Won't they need to have some confidence to invest in GM? This guy knows just enough to be dangerous.

And then, we have the father of the dealer terminations, Steve Girsky, named to GM's board of directors. Considering Whitacre seems to want about a 1000 dealers back through the arbitration process, one wonders if they are totally in tune. Things are becoming curiouser and curiouser, but I gave away my monthly column.

But I'm just stumped!

Permalink Reply by MARV ELEAZER on March 3, 2010 at 4:57pm

I've got my dealer sign up packet already and I'm a Ford dealer so I reckon they're on. If they buy anywhere close to the now defunct arm known as National Auto Finance then I'm ready.