Lordstown, OH GM Plant Closing

In reply to Duke :

He's threatening to take away the electric car subsidies.Which don't get paid out to GM, they get paid out to the consumer.  You could argue that'll negatively impact the sale of GM's electric cars, but since that's such a small percentage of their overall sales, I doubt they really care.

So it's political grandstanding.

In reply to docwyte :

Pretty sure that GM buyers are no longer eligible for the full tax credit anyway as they've met the production max and the credit has begun ot be phased out for them.

In reply to STM317 :

Exactly. 

I can't see where it makes a fundamental difference whether you are selling cars, or taller cars (SUV/CUVs). The problem comes when you can't sell enough of SOMETHING to utilize all your production capacity.  

Computerization, automation and supply chain optimization has meant that less physical space is required to produce a given number of vehicles, too. 

STM317 said:

In reply to docwyte :

Pretty sure that GM buyers are no longer eligible for the full tax credit anyway as they've met the production max and the credit has begun ot be phased out for them.

GM is at 190,000 units they're expected to hit 200k in December, at which point the subsidy will start it's reduction.

What I'm concerned about is that then president has it in his head now that expanding the Chicken tax to all foreign produced vehicles would be a good idea.

Malaise era 2.0 here we come.

mazdeuce - Seth said:

Interesting that they're canceling the Volt. I know the numbers on it aren't great, but the tech seems solid. I can see where they're coming from that there isn't much of a future for cars as they're built now. It's either trucks, SUV's or the next generation of things which are electric and/or self driving. None of my kids are really interested in cars, and the ones they are interested in aren't new. 

This speaks volumes from the perspective of an individual at the opposite of the the spectrum.....driving a totally irresponsible high HP pavement shredder that just happened to garnered 21.1 mpg with a 2010 CTSV....during a recent 10.5 hr trip on Americas finest I-10  

In reply to Knurled. :

Also risking a flounder but the guy making the threats couldn't figure out how to keep a casino open, arguably easier to do profitably than producing cars, but still considers himself earth's smartest business mind.

Wally said:

In reply to Knurled. :

Also risking a flounder but the guy making the threats couldn't figure out how to keep a casino open, arguably easier to do profitably than producing cars, but still considers himself earth's smartest business mind.

are you making $$$ wally? are your friends comfortable($$$$$).....just wonderin'

I've made money and been comfortable my entire life.  I don't have any friends who's lives have suddenly gotten better in the last year and a half.  

Just your friendly neighborhood moderator here. 

Saying hi. 

Reminding everyone that there are lots of places to discuss politics on the internet. 

Other places. 

In reply to mazdeuce - Seth :

Indeed,the only winning move is not to play.  Even if trying to ask a question, just the act of inviting conversation may move things in a bad direction.  Post deleted.

Different OH plant, but damn. Maybe when GM is done firing all these shiny happy people, it'll free up some jobs for those that got laid off?

https://jalopnik.com/gm-workers-hung-whites-only-bathroom-signs-and-nooses-a-1830755166

My time in the auto industry led me to the opinion that GM and Ford (Chrysler was too small) could never really solidify their place as global in small car markets. Toyota can own their domestic market and take a stable large chunk of many other markets. 

For probably several dozens of reasons GM and Ford just can't own enough of non US global small car volume. GM's biggest market is soon to be (or is) China. Why not start building the cars there? 

They left the minivan market, reduced brands, and now leaning to small self driven cars. Ford is diversifying into bicycles, heck I would be excited to see a new Ford Triplane!!!! GM is trying to do the same but with different angles. I read an interesting article that rental cars companies and the illegal taxi cab, sorry I mean "ride sharing" companies may start to be bought wholly by the automakers. Just like Sony should have just bought Napster.

aircooled said:

For some reason, a lot of people seem to think this has something to do with tariffs.   It seems to have nothing to do with tariffs as far as I can see.

I recently saw this article referenced in relation to the GM plant closings and remembered your post:

https://www.marketwatch.com/story/gm-slammed-by-tariffs-as-steel-and-aluminum-costs-soar-2018-07-25

Maybe those people have a point.

Advan046 said:

For probably several dozens of reasons GM and Ford just can't own enough of non US global small car volume. GM's biggest market is soon to be (or is) China. Why not start building the cars there? 

GM does build cars in China.  The Chinese market is 100% of the reason why Buick still exists, because Buick has a historical significance in China.  GM has plants in China to make China-market cars, as well as drivetrains and other parts for US market cars.

The interesting thing is, because of the Chinese IP laws that more or less say that you have to surrender IP for anything you sell there, they pretty much HAVE to build Chinese market cars in China, because then they can dump their two-three generation old designs there.  They aren't selling 2019 US market models in China, they are selling 2000s models that they don't care if someone copies.

This is one of the things that made me want to throw wrenches at the radio during a certain political campaign, bitching about Jeep taking their bailout money and using it to make vehicles "(sad voice) in China."  Well, berking DUH.  It would be completely stupid to ignore a market with such huge growth, and it would also be stupid to export vehicles to some place with such hideous IP laws.  Much better to make (several generations old) vehicles there and import the profits back to the US.

In reply to Knurled. :

I understand your point, however all automakers have shift to launching new models in the PRC at the same time or even before the USA gets them. I did see some changes to the models sold in mid east China. As in they seemed noisier, not sure why. Some had different wheels and brakes. Maybe some software difference but basically ever car company is making and selling their best stuff there.

Cheaper to ship any small cars from PRC/Mexico to USA. 

There were something like 11 million more vehicles sold in China than the US in 2017. It's the largest auto market on the globe by a significant amount. Car makers aren't sending over 10 year old product in such a critical market. The Buick Envision CUV that GM builds in China and imports to the US is the same one they get in China. The Tesla's that are popular here are also popular there. 

It used to be possible to sell obsolete product in China because their emissions standards were that far behind the rest of the developed world, but that's no longer the case. Nobody is cleaning up their act faster than the Chinese.