Remember that vaunted General Motors recovery ushered in by President Obama’s bold bailout program?
Well, not so much.
In June 2009, GM filed for Obama-managed bankruptcy, costing the taxpayer some $50 billion. The vast majority of that cash was never paid back by GM. In November 2010, GM issued a new initial public offering at a price of $33 per share. Today, GM stock is trading at approximately $19.36, down about 40% from its initial price.
And the executive turmoil in the company is reaching fever pitch. Opel, a majority-owned subsidiary of GM, dumped CEO Karl-Friedrich Stracke about two weeks ago. GM Vice Chairman Steve Girsky replaced him. Analysts immediately claimed, “GM appeared to be panicking as the change comes so soon after a turnaround plan for the struggling Opel was approved and a replacement was not named.” Another analyst stated, “The timing of today’s announcement bodes poorly for the condition of GM’s European business.” Then, Opel’s new design chief Dave Lyon was thrown out of the building before even beginning his job. Within the week, global marketing honcho Joel Ewanick got tossed.
Edmunds says that GM’s growth in the month of July will be essentially flat. GM is losing domestic market share at a rapid rate. From January to April 2012, GM lost 11% of its market share – about 300,000 vehicles of market share. Cadillac was down almost 25%.
Remember that big GM boom? It’s a lie. Obama may have bailed out GM, but he didn’t bail out the taxpayer – and in the long run, GM won’t be a viable business just because the government cut it a check.