In a Labor Day message to General Motors employees, his first companywide statement since becoming CEO, Dan Akerson pledged to cooperate with the United Auto Workers (UAW). "Coming from a union family, I know on a very personal level the good things that unions can do," said Akerson, GM's fourth chief executive since 2009.

The UAW will negotiate a new contract with GM next year, and it may attempt to restore losses it agreed to ahead of GM's bankruptcy. This is expected to be a challenge for Akerson, who has a reputation for telling subordinates to "stop complaining and start working."

Continue reading GM CEO Pledges to Work with UAW; Concerns About IPO Arise

GM CEO Pledges to Work with UAW; Concerns About IPO Arise originally appeared on BloggingStocks on Sun, 05 Sep 2010 13:40:00 EST. Please see our terms for use of feeds.

Continue reading UAW adds its voice to new General Motors board of directors

UAW adds its voice to new General Motors board of directors originally appeared on BloggingStocks on Fri, 19 Jun 2009 15:40:00 EST. Please see our terms for use of feeds.

Last Updated at 10:20

According to CNBC, General Motors (NYSE: GM) shares were halted as bondholders agreed to a sweetened deal. Shares have been reopened since. (This post is a live update). GM shares have jumped over 15% since trading has resumed.

This still doesn't mean a bankruptcy has been avoided, but at least creditors would not oppose attempts to sell GM's profitable assets to a new company -- the "New GM" -- sponsored by the U.S. Treasury.

Continue reading GM shares reopen after being halted; bondholders agree to sweetened proposal

GM shares reopen after being halted; bondholders agree to sweetened proposal originally appeared on BloggingStocks on Thu, 28 May 2009 09:50:00 EST. Please see our terms for use of feeds.

General Motors (NYSE: GM) announced this morning that not enough of its bondholders agreed to swap its debt for company stock, pushing the automaker even closer to bankruptcy. GM was offering to exchange $27 billion in unsecured debt for 10% of the company's stock. The struggling Detroit damsel has until Monday to finish its restructuring or it will file for Chapter 11 bankruptcy protection. This deadline was set by the government and includes requirements regarding debt reduction, labor cost cuts and plant closures.

Continue reading GM inches even closer to bankruptcy as bondholders reject offer

GM inches even closer to bankruptcy as bondholders reject offer originally appeared on BloggingStocks on Wed, 27 May 2009 09:40:00 EST. Please see our terms for use of feeds.

In a clock-stopping move, the United Auto Workers and GM have come to an agreement on a health care deal. The key provision of the deal is that GM would contribute shares instead of cash to a health-care trust known as a Voluntary Employees Beneficiary Association (Veba).

In so doing, the UAW would own 39% of GM. The mix of ownership would then be 50% to the government, 39% to the UAW and 10% to the bondholders, with the remaining 1% for current shareholders. The agreement still must be ratified by GM workers.

Continue reading GM and United Auto Workers to clinch deal on health care

GM and United Auto Workers to clinch deal on health care originally appeared on BloggingStocks on Fri, 22 May 2009 13:00:00 EST. Please see our terms for use of feeds.

Continue reading UAW says it will dump stake in Chrysler. Can taxpayers dump theirs too?

UAW says it will dump stake in Chrysler. Can taxpayers dump theirs too? originally appeared on BloggingStocks on Tue, 05 May 2009 08:45:00 EST. Please see our terms for use of feeds.

The pressure that the Administration is putting on the UAW and the creditors at GM (NYSE: GM) and Chrysler may be good for the two troubled car companies, but the help for the two weak companies could hurt the strongest one -- Ford (NYSE: F).

Any cost advantages that come out of deals forced on labor because of the threat of Chapter 11 will cut costs at GM, and might bring those costs well below what Ford has been able to get in concessions on its own. GM could end up with a substantial gross margin lead over the No. 2 U.S. car maker.

Continue reading GM deal with government will hurt Ford

GM deal with government will hurt Ford originally appeared on BloggingStocks on Wed, 01 Apr 2009 07:00:00 EST. Please see our terms for use of feeds.

"We knew someone was going to have to take the proverbial `bullet,' and it would have made it a lot easier to accept that had the CEOs of the banks also been required to give up their jobs," said Jim Graham, president of a union local in Lordstown, Ohio, where GM produces the Cobalt and Pontiac G5 fuel-efficient cars.

The comparison isn't entirely unreasonable: Ken Lewis and Vikram Pandit should have been dumped out on the street too, and it's a testimony to both appallingly bad corporate governance and poor oversight by the federal government that either of them currently has a job doing anything other than dogwalking.

But why defend Wagoner? By defending Wagoner's "leadership", people like Mr. Graham are essentially admitting that GM was essentially destined to fail because of overseas competition and its uncompetitive labor costs. If they want to deflect blame from themselves, they should be embracing the Richard Wagoner as The Man Who Ruined General Motors script. Otherwise, there's nowhere to point the finger but inward.

Unions leap to Wagoner's defense: Why? originally appeared on BloggingStocks on Tue, 31 Mar 2009 16:35:00 EST. Please see our terms for use of feeds.

Continue reading Why don't we just hand the UAW the keys to GM and Chrysler?

Why don't we just hand the UAW the keys to GM and Chrysler? originally appeared on BloggingStocks on Mon, 23 Feb 2009 11:20:00 EST. Please see our terms for use of feeds.

Congress would like to keep the car companies viable and independent and is spending a lot of time and money toward those goals. As General Motors (NYSE: GM) and Chrysler reach the point where they need to have plans to show they can manage their businesses with government loans, the UAW is starting to give them a hard time. Someone is going to have to break the log jam.

According to Bloomberg, "The United Auto Workers union is objecting to proposals from General Motors Corp. and Chrysler LLC to modify a retiree health-care fund as required by the U.S."

Continue reading The UAW will get a call from the president

The UAW will get a call from the president originally appeared on BloggingStocks on Sat, 14 Feb 2009 05:59:00 EST. Please see our terms for use of feeds.

The UAW is not moving at much of a clip in terms of negotiating with GM (NYSE: GM). There has not been a single sign of progress, no news of concessions on wages or benefits. Congress was hoping labor costs would be brought down to the level of what Japanese companies pay US workers.

Creditors also appear to be getting ready to give the US's largest car company a hard time. A successful bailout of GM assumes that bond holders will swap much of what they owe for equity or simply reduce the amount that they are owed or the interest rates on those sums.

According to The Wall Street Journal, "General Motors Corp. bondholders formed a committee to negotiate terms of a debt-for-equity swap, a key requirement of the auto maker's loan from the U.S. government."

The firms holding GM's bonds may simply tell the company that unless they get a good deal for turning in their bonds that there is not deal at all. Creditors may believe it is worth the risk that GM may go into Chapter 11.

The UAW and creditors are probably playing the same game of chicken with GM and the new administration. Can the government allow GM to fail when the stimulus package is set up to increase US employment by three million jobs or more? A bankruptcy could build a big hole if its causes Detroit and its suppliers to lay off over one million employees.

The creation of a creditors committee is bad news for GM.

Douglas A. McIntyre is an editor at 24/7 Wall St.

UAW and creditors may work against GM originally appeared on BloggingStocks on Fri, 16 Jan 2009 04:09:00 EST. Please see our terms for use of feeds.

The ink is barely dry on the $13.4 billion in "loans" provided by the Bush administration at the end of 2008, but General Motors (NYSE: GM) is already talking about needing more. CEO Richard Wagoner says the company may look to secure additional government cheese in March -- earlier reports had suggested that GM believed the $13.4 billion would be enough to survive through 2009.

How does GM plan to demonstrate viability? It will need to secure broader concessions from the United Auto Workers union and, hilariously, try to convince bond holders to swap their debt for equity in one of the greater cash-burning machines in history. Good luck with that one!

Wagoner also said that GM is still looking to find a buyer for Saab. The company has denied problems in generating interest in the brand among potential buyers -- I'll believe someone is interested in buying Saab when there's a done deal. Similarly, GM has failed to generate any serious interest in Hummer, despite trying really, really hard to find a buyer.

GM's management has been extremely optimistic in terms of its "forward-looking statements," but so far it's all been bluster. Government officials should keep that in mind when GM brass shows up in March to demonstrate a plan for viability.

That didn't take long: GM CEO says he might need more money originally appeared on BloggingStocks on Sun, 11 Jan 2009 17:40:00 EST. Please see our terms for use of feeds.

According to Bloomberg, "General Motors Corp. has enough government loans to cover the worst-case scenario it described last month and says it won't need more if the economy holds up." Under the current proposal GM would get $13 billion and GMAC has already gotten $6 billion.

The "if" part is the issue. GM's assumptions are way too optimistic.

Beginning on the cost side, if GM's employees, particularly UAW members, see a pot of money going into the car company, they are unlikely to take deep jobs cuts. The union has already said it has given enough. Creditors are almost certain to look at the infusion from the government as a reason to fight hard to keep their status and get full payment.

Looking at sales, GM still assumes a domestic vehicle market that will drive 12 million units sales a year. Based on December sales numbers, the run-rate for the entire US next year is closer to 10 million. GM may have to offer big incentives to keep its market share, which will push down margins even further.

Dream on.

Douglas A. McIntyre is an editor at 247wallst.com.

GM: We don't need any more money originally appeared on BloggingStocks on Wed, 07 Jan 2009 10:40:00 EST. Please see our terms for use of feeds.

A Democrat as the new President. Usually the party favors unions. They give a lot of money. Democrats can also count on unions to endorse them and turn out the vote. Now it is time for the party which will control The White House and Congress to pay labor back.

It may not be that simple. According to The New York Times, "labor invested more than $300 million to help elect Mr. Obama and enlarge the Democratic majority in Congress, and it expects both to enact legislation that will make it easier for millions of workers to unionize."

The most obvious case that unions may not do as well as they had hoped is the UAW. Many car workers believe Obama may ride to their rescue. The Bush Administration said the UAW would have to go along with large cuts as their part of helping GM (NYSE:GM) and Chrysler. But, potential loans form the Obama Administration to the car companies may not push the union so hard.

The car companies are probably a bad example and the newspaper industry is probably a better one. It was once one of the largest employers in the US and is still a huge provider of jobs. No so long ago the unions representing reporters, drivers, and pressmen had the leverage with management to dictate terms which put their members solidly into the middle class. As the newspaper industry has moved into a downward cycle, these unions have lost their bite.

The Obama Administration could do something for the newspaper unions. It could help bail the industry out by giving papers loans. It could help guarantee jobs. But, that won't happen. The newspaper unions will die no matter what they did to get the Democrats in office. Obama knows there is only so much money to go around. If there is not enough to help unionized industries, that's tough luck.

Douglas A. McIntyre is an editor at 247wallst.com.

As unions look to Obama, their hopes may be false originally appeared on BloggingStocks on Mon, 29 Dec 2008 09:00:00 EST. Please see our terms for use of feeds.

The New York Times has reported: The last Chevrolet Tahoe rolled off the line here in Janesville shortly after 7 a.m. in the 90-year-old plant, which had built more than 3.7 million big S.U.V.'s since the early 1990s. While the overall new vehicle market has dropped 16 percent so far this year, sales of big S.U.V.'s have plummeted 40 percent. Their closings leave the Big Three with only one factory each still devoted to making traditional big S.U.V.'s - Ford Motor (NYSE: F) in Kentucky, General Motors (NYSE: GM) in Texas, and Chrysler in Detroit.

The car manufacturers have been hit hard by tight consumer credit, the high cost of fuel and an overall slowing of the economy. All three manufacturers have been pleading with Congress and the White House for financial support and with the UAW for contract concessions. After Two of the three (Congress and UAW) failed to act, President Bush stepped in to provide an aid package of $17 billion to get the auto companies through the first quarter of 2009.

Despite the rescue package finally coming through Wall Street has not been impressed. The stocks of GM (NYSE: GM) and Ford (NYSE: F) are down 35% since the announcement. Ford closed yesterday at $2.19, down -0.40, losing -15.44% in one day. GM closed at $3.00, down -0.52, losing -14.77%.

Can either of these companies avoid bankruptcy if they cannot stay off the pink sheets? Is bankruptcy inevitable? Are you buying these stocks with hopes of a recovery?

Continue reading GM SUV dinosaurs are a thing of the past

GM SUV dinosaurs are a thing of the past originally appeared on BloggingStocks on Wed, 24 Dec 2008 12:02:00 EST. Please see our terms for use of feeds.

Well George W. Bush is donning his Santa Cars hat this morning. This morning he announced a package of $17.4 billion in short-term loans. But he's doing it in a way which allows his successor to yank them all back on March 31, 2009. If Bush were still in office then, he'd no doubt pull back the money. But since Obama will be there instead, we don't know what will happen.

Here's Santa Cars' plan: He'll give automakers $13.4 billion in short-term financing from the TARP and an additional $4 billion could be available in February. But if the automakers are not financially viable by March 31, 2009, all the funds will be returned to the Treasury. What does financially viable mean? Santa Cars answer: "A positive net present value (NPV), which takes into account all current and future costs and can fully repay the government loan."

Continue reading Santa Cars gives Detroit a $17 billion Christmas present

Santa Cars gives Detroit a $17 billion Christmas present originally appeared on BloggingStocks on Fri, 19 Dec 2008 10:55:00 EST. Please see our terms for use of feeds.

President Bush and his spokesman made it clear that loans to GM (NYSE: GM) and Chrysler may carry eventual Chapter 11 filings with them.

According to The New York Times, "The White House raised for the first time on Thursday the prospect of forcing General Motors and Chrysler into a managed bankruptcy as a solution to save the companies from financial collapse."

It's about time. The Administration has come around to the conclusion that many experts on restructuring have believed for months. The UAW, suppliers, and creditors cannot be forced to their knees without a bankruptcy judge standing over them.

The theory that a number of members of Congress wanted to adopt is that GM and Chrysler should get loans to carry them over to March 31, at which time they can present a "car czar" with restructuring packages. But what incentives do the union and creditors have to play ball? They may simply believe that the Obama White House will extend more loans to help the firms to the end of next year, which is hardly a way to induce those who need to give up economic benefits much incentive. It is human nature to hope for the best and ignore the worst. It is also a part of the UAW's history to adopt the arrogant attitude that it can run the car industry by dictating that its workers should get the best benefits in the world.

The only way to solve the car industry's problems is with one bold stroke. If people owed money and people owed pensions fall in the process, so be it.

Douglas A. McIntyre is an editor at 24/7 Wall St.

Bush keeps Chapter 11 on the table for GM and Chrysler originally appeared on BloggingStocks on Fri, 19 Dec 2008 08:35:00 EST. Please see our terms for use of feeds.

Welcome to Way Off Wall Street, a column dedicated to providing Main Street opinions on topics of interest to investors. Each installment highlights the views of Americans who are far removed from the canyons of Wall Street -- and who often see things more clearly as a result.

Continue reading Way Off Wall Street: Can labor unions help stabilize the economy?

Way Off Wall Street: Can labor unions help stabilize the economy? originally appeared on BloggingStocks on Wed, 17 Dec 2008 18:00:00 EST. Please see our terms for use of feeds.

Continue reading Auto support fund: U.S. view is different

Auto support fund: U.S. view is different originally appeared on BloggingStocks on Tue, 16 Dec 2008 11:19:00 EST. Please see our terms for use of feeds.

Continue reading Auto support fund: Foreign governments help

Auto support fund: Foreign governments help originally appeared on BloggingStocks on Mon, 15 Dec 2008 11:11:00 EST. Please see our terms for use of feeds.