Has General Motors (GM) forgotten We the Taxpayers are still out $30+ billion on the $82 billion auto bailout?
General Motors Co. — which owned the auto and mortgage lender Ally Financial Inc. until 2006 and still holds a 9.9 percent stake in the company — said it will consider a bid for Ally’s foreign operations.
GM CEO Dan Akerson told Bloomberg News on Monday that the Detroit automaker may buy if the price is right…
Ally’s troubled mortgage unit Residential Capital LLC filed for Chapter 11 bankruptcy early Monday, as the Detroit-based Ally said it may sell its international businesses.
Let’s not get ahead of ourselves, shall we, Mr. Akerson?
At least $15 billion of the auto bailout loss is gone forever. The rest we own in stock.
Let us ponder that precipitous drop for but a moment.
For We the Taxpayers to break even on our GM shares, they must be sold at $53 per. Given the direction the stock is headed, that ain’t looking good. Were our shares sold today, we’d lose another nearly $16 billion.
Just another facet of the Obama Administration’s “success.”
Which brings us back to GM’s contemplated purchase of Ally Financial. GM has–while owing us billions–purchased before.
In a similar move in 2010, GM acquired AmeriCredit and renamed it GM Financial to expand its subprime auto lending and leasing.
Subprime lending? Meaning like Fannie Mae and Freddie Mac for Government Motors? Why, yes.
Just another in a long series of brilliant GM business moves.
Government Motors, as we said, sells Volt hybrids for $41,000. Volt hybrids cost GM $41,000 to make. It’s a zero-sum, non-profit product…
GM (in 2010) received more green (non-energy) energy patents than any other organization on Planet Earth…
And in bad joke harmonic convergence, GM spent $3 million to install solar panels at a (non-profit) Volt manufacturing plant – in order to save $15,000 a year in electricity.
It’ll take GM 200 years to break even on these solar panels. Except they won’t, because in 20-25 years they’ll have to replace them all, which means they’ll save–at most–$375,000, before spending another $3 million (plus inflation) to start the inanity all over again.
And if you haven’t yet had enough GM solar, and you liked Solyndra, and Beacon Power, and Ener1, and…
…Since its inception, General Motors Ventures has closed on 13 investments worth around $60 million, according to (GM’s Tim) Brumbaugh.
They include a $7.5 million investment in Sunlogics PLC — a manufacturer of solar-energy systems — and a $6 million investment in Proterra Inc., which makes zero-emission transit buses.
Fantastic. But fret not:
“We are only investing in technologies that can be utilized in the automobile itself or through our manufacturing facilities — something that’s going to give us a competitive advantage,” Brumbaugh said.
Like their $3 million Volt factory solar panel fiasco.
And the visual of GM incorporating “solar-energy systems” in their vehicles is at once mind-numbing and absurdly hilarious. Given that a 12-hour charge of a Volt’s 400 pound battery gets you less than 40 miles down the road, how much additional juice will a GM-venture-capital solar panel on the car’s roof provide?
“That would be a big strategic win for us,” he said.
There’s that Obama-Government Motors bizarre definition of “success” again.
“It’s not chasing a hot trend,” Brumbaugh said. “It’s something that if you’re doing to do it, you have to stick to it — and management has to stick to it — over decades.”
That sounds an awful lot like President Obama’s “doubling down” on his Solyndras, and Beacon Powers, and Ener1s, and the rest.
Much of Europe spent the last decade subsidizing non-green non-energy at levels far greater than ours and are now giving it up as absurdly wasteful and futile.
With decisions like all of these, is anyone shocked by GM’s stellar stock performance?
So before GM takes yet another flyer on yet another bankrupt idea, perhaps they should instead begin to pay down the huge debt they owe We the Taxpayers.
It would be the first good General Motors decision in quite a while.
And it might actually, finally begin to drag the stock price up from its current pathetic position.