Those observing the unfolding events at
General Motors in the US have come up with a variety of clichés and
metaphors to describe the manufacturer’s long decline – like
watching a car crash in slow motion, like a giant brought to its
knees, like watching someone bleed to death via a thousand
My personal favourite is
the supertanker and the iceberg, with GM’s executives finally able
to see the menace looming ahead of them, but unable to change
course in time to avert disaster.
It remains to be seen
whether the actions it is taking in the US – such as cutting 40
percent of its dealers and getting rid of the Saturn, Hummer, Saab
and Pontiac brands – are enough to save it.
Meanwhile, in Europe, the
German government is in the unenviable position of having to choose
one of three bids tendered for Opel, with the consequences of
choosing an unsuitable suitor potentially catastrophic.
Will Angela Merkel’s
administration opt for parts supplier Magna International,
acquisition-hungry Fiat, or dark horse RHJ International, about
which little is known?
At least Germany will be
in a position to minimise job losses for German employees of Opel –
although the European Union may well have something to say on that
The future for GM’s
factories outside Germany, including Ellesmere Port, just got a
little darker. Writing as someone who grew up very close to the
’Port, this is sad news indeed.
Events at GM’s former
captive GMAC are no less dramatic. President Obama has promised
“more capital” for GMAC – with $7.5 billion the latest rumoured
figure – and said that the financier will also take on the job of
providing funding for Chrysler’s customers and dealers.
Whence, then, Chrysler
Financial? It seems a shame to let all those systems, employees and
distribution channels atrophy away to nothing. In fact, Bloomberg
reported, Chrysler Financial’s owner, Cerberus Capital Management –
which, until recently, clung to its dream of combining the
captive’s operations with those of its other auto finance
investment, GMAC – may convert the unit into a standalone lender,
or begin to offer “insurance or remarketing leased vehicles”,
Back in the UK, the
government’s long-awaited scrappage scheme was finally unveiled
(see Finn: New scrappage scheme could mean end of 0% deals
and Varying response on financial terms), and is, as might
have been expected, a bit of a mealy-mouthed mess, with industry
dissatisfaction – beneath official proclamations of satisfaction –
not hard to detect.
It is still very early
days for the scheme, and it may yet surprise us all. But it is hard
to square one of the government’s stated aims – of reducing CO2
emissions from transport – with the scheme’s utter lack of a green