“Pump gas will be back to $3.60 by summer 09′. And returning to $4.00 in 2010. ”

I suggest you read what one and only one lone stock analyst was saying while all the others were getting caught up in the hype of the speculators who were predicting $200 a barrle when it topped out at about $140 before taking the constant slide to where it is now below $60 a barrel.

This guy said the prices were all out of whack with reality and being driven by the traders and speculators who were creating an artificial market because they were allowed to under the current administration.

The reality he suggested was that after the summer months where usually demand was highest that gasoline would steadily drop till it dropped to at least below $2.50 a gallon on election day. This all happened because the eventual call for investigations by some members of congress gave the boys at Exxon some call for concern since very shortly they would no longer control the Whitehouse, and be able to hold off the previous investigation into price fixing. The truth is that regardless of what the Spot Price of the day paid by futures traders the big guys like Exxon are actually buying Oil from Fields they have already secured years back on longer term contracts that most likely only reflect an actual cost of anywhere from $35-$55 a barrel crude price. The prices for the refined products are justified by the Traders daily prices so the likes of Exxon was very happy to see the Speculators get crazy and drive prices sky high as their profits tracked accordingly. The simple explanations of increased profits due to volume don’t track as this last quarter Exxon posted it’s highest quarterly profit ever when actually demand in the US has been not just flattened but has shrank by 7% this last year due to increased conservation by consumers.

Why do you think Exxon is laying off 3,500 people when they are at their highest profits ever? I would say it is in preparation for the future where they know the likes of “W’ won’t be there to give them the ability to rape the consumer for obscene profits in a time when this country is at it’s lowest point in 80 years economically.

Get real guys gas will probably go back up to about $2.50 a gallon by summer 2009 which the same analysts I quoted earlier said it would. This guy’s has been spot on so far so I suggest we all plan for that, and Bob Lutz and the boys at GM have planned for this as well because in an interview he said that as long as fuel stays above $2 a gallon all the more efficient vehicles still have a market in the USA, and this is a market GM will be able to address quicker than many people think as they already build these kind of vehicles in Europe under the Opel Brand.

#42 Ed M says,
“I think the 6.9 billion is sitting in the sales lots of America.
Vehicles that GM built last spring and summer are quickly becoming write offs….The wages and materials costs for these unsold vehicles have been paid I would presume but there’s no way to recover these costs. I’m not an accountant but that’s my take on the losses.

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I was not going to mention this, but it has come up a few times now.

Automakers book revenue as soons as they ship vehicles to dealers, not when the dealer sells them. GM revenue is contingent on dealers buying more product for their lots.

That is the original reason why GM formed GMAC as a wholly owned subsidiary (in like 1919), to be able to have a standard, easy access way for dealers to access credit to buy from GM.

Now that GM has sold the majority off to Cerberus, they no longer can control it…and Cerberus, through GMAC, is cutting off many dealers access to credit completely in the last three months(rendering them the ‘walking dead’) and ALL of the rest have to pay 5% per month on any new inventory purchase, with the full 100% due in 180 days.

That is a major reason (along with the loss of incentives and consumer leases from GMAC) sales were off 45%. Dealers are desperately trying to sell inventory to just make payments to GMAC, or to line their own pockets before they go bankrupt, not inventory replenishment.

Lot sales right now are not translating to re-orders to GM. A far greater percentage of sales to GM are now being generated from specific customer orders. Lot inventory discounts/reductions actually hurt customer orders for the short term future (and GM corporate) until the remaining dealers can find alternative sources of financing other than GMAC, or they can trim their lots to be a viable, on-going concern.

If GM gets bailed out (or somehow survives another few months), the next wave of news is massive closures amongst the dealers, which will continue to translate to huge year over year loses in sales.

Note to Matt: No ‘lol’ or ‘hehe’s in that one for you. I did not spell check it though.

And also people forget that Toyota has ONE union shop here in the US… It’s the New United Motor facility right here in the SF Bay area in Fremont. It was started as a GM/Toyota joint venture but GM doesn’t use it much. Toyota keeps threatening to close it, but they don’t. It actually is one of their premiere shops. For awhile, they even exported Matrix cars built there BACK to Japan, which is almost unheard of. Last rumor I heard was they were going to actually move Prius production there.

“better get here pretty soon, gas is comin down…I know its goin up again”

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The price of pump gas seems to be connected directly to the S&P. Which is a confirmation of it being manipulated and adjusted to consumer sentiment. The price of premium gasoline and the stock price of GM are also running parallel. Dropping from 4.25 to 3.50 to 3.20 in a couple of months. Almost and exact match.

But, this is good for GM. The heavier vehicles will finally sell and make room for the new wave of public favorites. However, I am a realist and I believe GM has been too careless with it’s future for too long. I believe the Chevy brand will live on, but not as we know it. The Volt will be produced in 10’s of thousands and will be very popular around the world. The post GM boardroom will look much different as well.

Pump gas will be back to $3.60 by summer 09′. And returning to $4.00 in 2010. The small SUV EREV Cruze plug-in will be the absolute bomb.

=D~

Cruze, Vue or Volt better get here pretty soon, gas is comin down. but I’m waiting for a Volt, cause I know its goin up again and all those new SUV owners can pay through the nose but not me.

NO PLUG, NO SALE, LJGTVWOTR, =D~~~~~~~~

The Volt should be the first plug-in product from GM. It’s that important. Second, I think the Vue is kind of like the bastard son of the e-flex technology. Maybe they have gained so much experience with the e-flex technology that they have decided to drop kick it into the Vue. Now that would be great. Why mess around with anything less? Make a Cruize e-flex as well.

They could also be delaying these programs to put pressure on Congresss to send some dough. Hey Congressmen, soon we will have to delay the Volt and then it will be all over. What will happen to GM-Volt.com if GM announces a Volt delay? Well, I guess many of us will quietly move to other forums. Maybe we’ll have an Internet funeral for GM and wish whoever gets the technology good luck.

Anyway, Mr. Lutz seems a bit tired. It’s kind of a shame that this old war bird has to endure such stress at this stage in his life. Of course he doesn’t need the money and can just say, “Bye bye guys!” but I hope he sticks with it and finishes his baby. His capstone project. Come on Mr. Lutz, please hang in there for a little while longer. Try not to get too upset with people who think the Volt program should be cut or they they want to at least put in a delay. Tell them to get bent and that they might as well pack up their box and go home now.

Mr. Wagoner should tell everyone to get off of Mr. Lutz’s back and let him finish the Volt. If they have any financial or doom and gloom questions to come to him.

I truely feel that the Volt is the only thing that is going to save GM in the long-run. Competing with the Japanese on tiny rice-burners? Good luck. Many of you haven’t even seen how tiny cars can get! The Japanese have been building excellent shoebox cars for a long time. They are even cool looking. They can immediately drop down a class and already have dozens of models to choose from. All proven, debugged, in volume production, etc. Again, good luck.

The electrification of the automobile is the Big 3’s only hope. Thinking otherwise is just nieve. Experience takes time, even with brilliant engineers and bucket loads of money. Finish the Volt and drive into history.

I think the 6.9 billion is sitting in the sales lots of America.
Vehicles that GM built last spring and summer are quickly becoming write offs. They’re sitting partly because there are few purchasers because of fear in the economy and partly because no can get loans. These vehicles will sit for some time.

The wages and materials costs for these unsold vehicles have been paid I would presume but there’s no way to recover these costs.

I’m not an accountant but that’s my take on the losses.

For sure, as I commented in #31, we’ve got to get the credit markets rolling or we’re in for one heck of a rough ride.