While its auditors are busy expressing doubt about the company's ability to continue as a going concern, General Motors Corporation (NYSE: GM) announced that it will not be using its company suites at the NCAA's Final Four basketball event. The seats are part of the sponsorship package, but GM is now talking with the NCAA about what to do with the suites.This is a relatively small example of the kind of wasteful spending that GM engaged in, with private jets and excessive executive compensation being better examples.
It's all well and good that GM isn't using the suites this year but we should keep in mind that GM has been in trouble for a long, long time. Even when the company's SUV sales were propping up performance, the balance sheet was still an absolute disaster, and the company should have been looking at every option possible for reducing its debt load. Renting out suites to entertain dealers and customers has not been something GM could prudently afford for a long time.
It's yet another very small example of the poor management that has led this company into its current situation and, miraculously, is still allowed to run the show even as taxpayer cash is shoveled in.
Closing Bell: Dubai sends jitters throughout the market (S, BBY)
Heinz looking good after the second quarter?
Why isn't Bank of America updating its shareholders on CEO situation?
Reader Comments (Page 1 of 1)
2-27-2009 @ 6:22PM
tinmankansas said...
Hurray! The economy will only get better as people and corporations are forced to realize how out-of-whack are priorities. I started buying local products from companies who do not spend BILLIONS on TV advertising for professional sporting events and network "reality" programs. When enough of these mismanaged giants fall, the outrageous corporate executive salaries, and professional atheletes salaries and entertainers salaries will drop. And guess what... the quality of entertainment won't suffer... it will actually go up. Watch a minor league or college game to see REAL hustle, drive and talent. Watch a community theater production to see REAL emotion and feeling. Turn off the spigot to the medocrity we are now being given by corporations, entertainers, athletes, and politicians.
2-28-2009 @ 1:45PM
Michael Taylor said...
Well stated - when a company is enduring losses for qtr after qtr, SUV sales remain constant (horrible), one needs to eliminate wasteful spending and commit to prudent use of resources. Having stated that, there are many companies who should have implemented these policies (common sense) long ago but chose not to. Whatever happened to basic economics common sense 101?