Just slightly more than a year after emerging from bankruptcy protection and giving the US government 61% ownership stake in exchange for survival, General Motors has officially filed with the US Security and Exchange Commission for a proposed Initial Public Offering of shares in the new company.
The terms of the IPO in terms of pricing have not been disclosed, and is expected to occur in the fall, possibly in October. At least 20% of the governments share will be sold to the public and proceeds of anywhere form $12 billion to $16 are expected, making it potentially one of the largest IPOs in history. There will be 500,000,000 shares of stock after the IPO and GM will sell preferred shares, while the government will sell common shares.
The S1 filing which details the risk and benefits of investing in GM shares, as the company sees it, can be read in detail here.
Within the document, and germane to our focus here, GM outlines its alternative energy vehicle strategy.
They state the following five objectives:
• Continue to increase the fuel efficiency of our cars and trucks;
• Develop alternative fuel vehicles;
• Invest significantly in our hybrid and electric technologies;
• Invest significantly in plug-in electric vehicle technology; and
• Continue development of hydrogen fuel cell technology.
GM declares the Volt and Ampera as their only extended range electric vehicles under development, although they are developing another PHEV. “We plan to invest heavily between 2011 and 2012 to support the expansion of our electrified vehicle offerings and in-house development and manufacturing capabilities of the enabling technologies-advanced batteries, electric motors and power control systems,” GM writes.
Specifically GM mentions “a PHEV, using a modified version of GM’s Two-Mode Hybrid system and advanced lithium-ion battery technology, is scheduled to launch in 2012. The PHEV will provide low-speed electric-only propulsion, and blend engine and battery power to significantly improve fuel efficiency.” The specific make and model of the 2-mode plugin hybrid, as well as projected production volumes is not mentioned.
As important as the Volt is to GM’s future, it is mentioned 22 times in the S1, the company still perceives risk and uncertainty related to it.
“We have announced that we intend to produce by November 2010 the Chevrolet Volt, an electric car, which requires battery technology that has not yet proven to be commercially viable. There can be no assurance that these advances will occur in a timely or feasible way, that the funds that we have budgeted for these purposes will be adequate, or that we will be able to establish our right to these technologies,” GM writes.
+1
Aug 19th, 2010 (7:15 am)I don’t plan to buy any GM stock, but I hope it does well.
(also like the use of the word “significantly”)
+2
Aug 19th, 2010 (7:20 am)I think the GM IPO will do well. They are being conservative in setting expectations and have outlined risks to success. Although, I think the resultant company is over valued initially.
A bunch of stuff happening this fall!
+3
Aug 19th, 2010 (7:22 am)I was planning on buying some, but I am not convinced the leadership has given up on making stupid decisions. I’m out. That will leave more for others to buy.
+8
Aug 19th, 2010 (7:26 am)Good Luck in your IPO GM. But I will not buy any, I am still smarting from the Money I lost on the OLD GM Shares.
I am however committed to being a Volt customer once my Solar Panels are paid off
+2
Aug 19th, 2010 (7:28 am)“• Continue development of hydrogen fuel cell technology.”
Interesting that automobile manufacturers are researching H2 fuel cells still. Either they know something we don’t about fuel cells, or, they are just keeping up with each other.
Since a fuel cell car is pretty much an electric drive, at least most of it can be reused in a BEV.
I wonder if reforming NG=>H2=>fuel cell is more efficient than just burning CNG in an ICE? And could it be done onboard the vehicle?
+7
Aug 19th, 2010 (7:32 am)From that article:
“We have announced that we intend to produce by November 2010 the Chevrolet Volt, an electric car, which requires battery technology that has not yet proven to be commercially viable.”
I’m thinking the Volt is a slam dunk.
+23
Aug 19th, 2010 (7:34 am)I completely understand their doubts on the Volt, especially after the EV1. After saying that, they have built it, now we must come (buy it).
It’s really in our hands, as fans of this car and it’s technology. It’s in our hands to share with our friends, family, and neighbors about how important it is to get off of fossil fuels. How it’s in all of our best interests to start traveling in automobiles that not only make our country more prosperous, but make our cities cleaner. I for one tell my brothers and sisters (literal) that they’d be my hero if they bought a Volt. I’m sincere about that. Spread the gospel.
Be an American hero, buy a Volt.
+1
Aug 19th, 2010 (7:37 am)What say ye Static?
-16
Aug 19th, 2010 (7:40 am)(click to show comment)
+4
Aug 19th, 2010 (7:43 am)Play the strong hand with Voltec. Many manufactures will be moving away from hybrids and working toward strong solar assist BEV’s. Some will play catch up to the Volt and Ampera with EREV offerings.
Think about it. In 5 or 6 years will the public really choose to drive gasoline burners over smooth quiet EREV’s?
=D-Volt
+2
Aug 19th, 2010 (7:50 am)maybe is just an intern re-organizing the files on the previous H2 work.. I think pretty much everyone understands the truth behind H2 by now.
+1
Aug 19th, 2010 (7:53 am)There is a very good explanation of IPOs and how the GM IPO will progress from here in this Detroit News article. If the link doesn’t work, the article title is Mass Pitch to Precede GM Stock Sale
http://www.detnews.com/article/20100819/AUTO01/8190399
+1
Aug 19th, 2010 (7:54 am)From the IPO doc:
“Our management team for financial reporting, under the supervision and with the participation of our Chief Executive Officer and our Chief Financial Officer, conducted an evaluation of the effectiveness of the design and operation of our internal controls. At December 31, 2009, because of the inability to sufficiently test the effectiveness of remediated internal controls, we concluded that our internal control over financial reporting was not effective. At June 30, 2010 we concluded that our disclosure controls and procedures were not effective at a reasonable assurance level because of the material weakness in our internal control over financial reporting that continued to exist. Until we have been able to test the operating effectiveness of remediated internal controls and ensure the effectiveness of our disclosure controls and procedures, any material weaknesses may materially adversely affect our ability to report accurately our financial condition and results of operations in the future in a timely and reliable manner. In addition, although we continually review and evaluate internal control systems to allow management to report on the sufficiency of our internal controls, we cannot assure you that we will not discover additional weaknesses in our internal control over financial reporting. Any such additional weakness or failure to remediate the existing weakness could materially adversely affect our financial condition or ability to comply with applicable financial reporting requirements and the requirements of the Company’s various financing agreements.”
Some of you may recall GM’s penchant for restating results over the years. There’s why; one of the worst finance departments in the business. And, still, that’s where the last long-term CEO came from. And the Board of Directors didn’t do anything about it. No wonder they went belly-up. And is it fixed? Maybe, maybe not.
-6
Aug 19th, 2010 (7:59 am)From the IPO doc:
“In some cases, the technologies that we plan to employ, such as hydrogen fuel cells and advanced battery technology, are not yet commercially practical and depend on significant future technological advances by us and by suppliers.”
An old problem is mentioned here… advances made by suppliers (as in, the battery supplier for the Volt) are also available to the competition.
From the IPO doc:
“Commitment to new technologies. We have invested in a diverse set of new technologies designed to meet customer needs around the world. Our research and product development efforts in the areas of energy efficiency and energy diversity have been focused on advanced and alternative propulsion and fuel efficiency. For example, the Chevrolet Volt will use lithium-ion battery technology to achieve a 40 mile range on plug-in battery power only, and when the Volt’s battery runs low, an onboard gasoline-powered engine/generator will extend its driving range another 300 miles on a full tank of gas. Our investment in telematics and infotainment technology enables us to provide through OnStar a service offering that creates a connection to the customer and a platform for future infotainment initiatives.”
Too bad GM couldn’t lock up the excellent Microsoft Sync or form a partnership with Apple. Also no mention of any open systems development in infotainment or telematics.
I also note the “300 miles” mantra repeats. CR reported 9 gallons. Do the math… a little worse than 35mpg.
Aug 19th, 2010 (8:00 am)I know many retired folks who had their IRA nest egg go bust because of GM’s bankruptcy. I’ve heard from those folks that GM won’t even give them 1 new share for every 100 of the old. Because of this lack of concern for their prior share holders I will never buy their stock.
Never the less, I will buy a Volt.
NPNS!
+12
Aug 19th, 2010 (8:00 am)-1 to you. It is not the government’s fault that GM stock tanked. It was the management of GM that caused it to tank (along with other reasons).
-6
Aug 19th, 2010 (8:02 am)I couldn’t help bu notice this:
“For example, we expect the Chevrolet Cruze Eco to be capable of achieving an estimated 40 miles per gallon on the highway with a traditional internal combustion engine. Additionally, we are expanding our telematics and infotainment offerings and, as a result of our OnStar service and our partnerships with companies such as Google, are in a position to deliver safety, security, navigation and connectivity systems and features.”
The Cruze Eco might do 40mpg, which would be nice… but who’s going to pay almost $2K extra for 3mpg? The Cruze Eco is about as expensive as a Honda Insight and within spitting distance of a Prius.
-4
Aug 19th, 2010 (8:04 am)Customer enthusiasm didn’t save the EV-1.
+6
Aug 19th, 2010 (8:05 am)The volt will only be a slam dunk if GM gets the costs down which still requires more committment to higher volumes and not making big profits early on. Costs won’t come down until Manufacturing capabilities of advanced batteries, electric motors and power control systems are mature and domesticly produced (close to assembly plants).
This is clearly Nissan’s plan for producing the Leaf in Tennessee with the volumes required to get the cost down.
GM’s strategy seems to be to soak the early adopters with lower volumes and sit back and wait to see what happens for a couple years with technology, gas prices and government support (i.e. a 2012 election that could result in less support especially because of budget problems).
It is this uncertainty of government support (not taking sides just pointing out the obvious budget catastrophe going on) which I feel means the success of the electrification of the automobile could be hindered if companies don’t take the path to lower costs by achieving economies of scale rather than economies of continued goverenment support. Government support of these vehicles and Hydrogren etc. are bound to dry up.
What the government will probably do is raise taxes on gas rather than just giving money to these companies for research new factories and more credits.
+14
Aug 19th, 2010 (8:07 am)You couldn’t buy one if you tried bud. This is a whole new ballgame.
+1
Aug 19th, 2010 (8:17 am)I see very little risk to GM by saying “OK, agree to pay us $41,000 and we will build you a Volt.” The fact that they won’t build spec cars and put them on the lots, speaks volumes, IMHO. It’s just not the book I wanted to read.
+3
Aug 19th, 2010 (8:20 am)_________________________
And if a Volt is too expensive or is not for you, any new GM product would suffice!
+19
Aug 19th, 2010 (8:23 am)ATTENTION GM:
A lot of us were left holding the bag with your old stock. While it would be appreciated, I do not expect new stock to replace the old. But, it is ENTIRELY within the realm of possibility that you provide discounts on the purchase of new vehicles in exchange for this old stock. It would help sales and promote positive public relations toward the new GM. I am sure that many previous stockholders would not even give the new GM a chance, given how badly we all got busted with your prior foul-ups. If you do as I suggest, you will open up market share that is nearly off limits to you right now. If my $7000 worth of stock, now worth $150, were to offset, lets say $1500 worth of new car, you sell a vehicle, my attitude gets (mostly) fixed, and another GM car is on the road spreading the gospel of the reformed GM. Everybody wins!
[Please give this +1 so anybody from GM who reads this forum can see how great of an idea it is and emphasize it to the management people]
Aug 19th, 2010 (8:23 am)The problem with this IPO is it doesn’t bring in any money for GM to fund programs. All or most of the money will go to the government. (I understand why) So the IPO is not funding growth.
Most IPOs bring in lots of money to fund rapid growth.
+2
Aug 19th, 2010 (8:24 am)Buying the Volt is better. Leasing the Volt is better than not getting one at all. If they can keep the $2,500 down // $350 per month lease going for the full model year, I think it will do very well.
-17
Aug 19th, 2010 (8:26 am)(click to show comment)
-4
Aug 19th, 2010 (8:27 am)I think GM is wisely driving the costs of electric propulsion down through mass production of the EREV, so that they can simply splice in the hydrogen / natural gas / alcohol fuel cell at a point which makes that technology’s launch far more palatible.
I just don’t see batteries achieving range, long life, rapid recharge capability and low cost for several years – if ever.
+3
Aug 19th, 2010 (8:29 am)I lost 100k with the GM stocks, but I will try to make it up with the new stocks. Some will say, I never learn.
+9
Aug 19th, 2010 (8:29 am)=============================
Agreed!
When you buy stock, it comes with risk. If you do not want the risk, don’t buy stock. And be prepared to lose as much as you were prepared to gain. That is the game.
JMHO
+3
Aug 19th, 2010 (8:33 am).
Along related lines, it is worth noting that we are yet to see any full-year, externally audited financial statements. Experience shows that financial statements issued by a corporations management may be right, or they may be far off the mark. (We remember Enron.)
Presumably GM management is doing their best to present the situation honestly, but as management allocates income and expenses within a financial year to particular 3-month periods, judgment is involved. (Should my vacation expenses be charged to last winter, when I decided to go, or maybe next December, when I will do the travel?)
Such judgments make some quarters look good at the expense of other 3-month periods. The same is true with a decision to increase and decrease reserve funds, possibly by large amoutns. Statik has mentioned that future quarters are unlikely to look as good as the last two.
Let us hope that GM does well in future years so that it can make lots of Volts. However, “by the numbers” we still don’t have many of the numbers for the current year, and we have no outside auditor verification. That makes the outlook for the future (and pricing the IPO) even more murky than it would be otherwise.
+1
Aug 19th, 2010 (8:33 am)In addition to getting better mpg, the Eco Cruze has more hp and torque than the base engine Cruze. I’ve seen differing reports on the hp, but I know the turbo has more torque.
+8
Aug 19th, 2010 (8:34 am)Rashid, Your logic here seems a bit sketchy here ….
-4
Aug 19th, 2010 (8:36 am)Fault has nothing to do with it the gov is trying to find ways to stimulate the economy and keep people off welfare the gross giveaway is almost unbelievable and yes it is there fault because it was there rules that did not allow those former employees to sell stock in there retirement fund. We could only watch it tank.
Tom
+2
Aug 19th, 2010 (8:41 am)Stock investing is a risk and companies do go bankrupt.
Aug 19th, 2010 (8:42 am)From the article: “Specifically GM mentions “a PHEV, using a modified version of GM’s Two-Mode Hybrid system and advanced lithium-ion battery technology, is scheduled to launch in 2012.”
I think this will be one of the biggest battlegrounds in the next 2 years, the PHEV. Ford is working on one of these also, presumably a next generation Ford Escape PHEV to come out at roughly the same time. This will be an interesting fight to watch. I’m glad to see GM actively pursuing the PHEV although I wish they would exhibit a bit more enthusiasm towards the EREV philosophy. The bottom line will be the number of consumers that pursue cars like the Volt after the first wave of early adopters move through.
Interesting times.
+2
Aug 19th, 2010 (8:47 am)From the article:
“We have announced that we intend to produce by November 2010 the Chevrolet Volt, an electric car, which requires battery technology that has not yet proven to be commercially viable. There can be no assurance that these advances will occur in a timely or feasible way, that the funds that we have budgeted for these purposes will be adequate, or that we will be able to establish our right to these technologies,” GM writes.
This statement falls right in line with virtually everything we’ve seen come from GM about the VOLT over the last couple of years – cautious optimism on the part of the VOLT team, guarded conservatism on the part of the corporate line.
I have 120% faith that the VOLT will be a commercial success – both in terms of customer acceptance and in terms of the vehicle meeting and exceeding customer expectations. The resilience of GM leadership to keep the VOLT project on a tight timeline through all of the financial turmoil of the past three years has been remarkable.
Long term, it will be up to GM’s new leadership to keep an intense focus on the VOLT – continuous learning, continuous improvement, and continuous paying attention to every little detail – just as they have during this initial development phase. The old GM had a penchant for spending a fortune on product development, launching the product, and moving on to the next project. Toyota, on the other hand, continuously plowed money back into models like the Prius, making continued improvements and enhancing the customer’s experience. Let’s hope the new GM has learned from past mistakes.
OLD GM = too many divisions, too many products = dilution of engineering resources = spreading resources too thin
NEW GM = right number of divisions, right mix of products = focus of engineering resources = laser like corporate focus on continuous product improvement = growing market share as consumers come to appreciate GM’s commitment to superior product, quality and safety.
If this new vision of GM comes to fruition, as I expect it will, the GM IPO will be a huge success. But I cannot blame anyone for staying away from this first round of stock (remember that the government is only selling about 20% of the company – they will still own about 40% – so there will be more stock sales in the future). 500,000,000 shares of any company’s stock is a huge number…. there will always be an open market for GM stock and plenty of opportunities to own a piece of the company if you choose to.
+1
Aug 19th, 2010 (8:49 am)“or that we will be able to establish our right to these technologies,” GM writes.”
Now, that part of the statement really blows me away. What do they really mean? Do they think that they may get sued for using technology someone else has a patent on? Sure sounds like that to me.
+2
Aug 19th, 2010 (8:50 am)Bitter memories
of the recent stock collapse
will make a hard sell
Common folk won’t buy
But the State majority
is an albatross
Around the neck of
America’s psychy and
needs to be removed
Institutions look
for long term stable slow growth
Those are the billions
Institutions will
pony up the billions now
That the Volt is here
+4
Aug 19th, 2010 (8:50 am)You keep going on about GM’s lame warranties, GM, Toyota, Chrysler, Honda, Ford, VW. I’m pretty sure these major companies all offer the same warranties. 3 year 36,000 bumper to bumper, 10 year or 100,000 powertrain. The only company I think that offers a really long bumper to bumper is Hyundai Kia, and that’s cause they’re tiny and trying to catch up. If they were as big as the top 5 they’d start offering the same.
+2
Aug 19th, 2010 (8:53 am)Rasiid,
Not sure where this mornings venom comes from, but much of GM’s current product mix is exceptional. No doubt you could apply your comment to some past GM product, but it certainly does not apply to current models like the Chevy Malibu, Equinox, or Traverse, the Cadillac CTS or SRX, or the Buick Enclave or Lucerne. And GM’s warranties are as good or better than the majority of their competition. Have another cup of coffee and keep thinking about driving your new VOLT one day soon.
+1
Aug 19th, 2010 (8:54 am)Fuel cell and such will continue the practice of customers having to bring their vehicles into dealers for maintenance on a scheduled basis. Much money to be made for GM and the dealers if this scheduled maintenance practice continues. Much money will be forever lost to GM and the dealers if customers have few or far between scheduled maintenance with electric vehicles. It is as simple as that. Think of the full supply chain from manufacturer to the dealer to the customer’s vehicle and you can glimpse a small portion of the money train.
+5
Aug 19th, 2010 (8:54 am)First of all who is still left holding old GM Stock? If you are then you are stupid as you can still sell your MTLQQ stock for some value (it’s selling for about $0.48 today). And for those of us that sold it at a loss, (which is nearly everybody) how do you define what discount should go to who?
Even if this idea made sense, (which it doesn’t) the logistics of it are a nightmare.
The stock market represents risk, and all investors know this. The fact that GM went bankrupt and the stock lost value is a fact of life…get over it. (full disclosure, I owned old GM stock and sold it at a fraction of the value I paid for it and wrote off the loss.)
Having said all that I will probably buy new GM stock and sell it during the IPO frenzy while the value is high.
Aug 19th, 2010 (8:54 am)I think it simply has to do with LG’s batteries. They are buying from LG but if Ford secured a deal with LG and GM couldn’t find a better replacement and they were losing money from the Volt they could just decide to stop selling it. I don’t think this will happen though.
+1
Aug 19th, 2010 (8:57 am)GM is issuing preferred stock as mention in Lyle’s article and other articles about the IPO. This brings GM money but, yes, there is the question about how much.
+3
Aug 19th, 2010 (9:00 am)I for one will invest in GM. I realize the risk, and if it tanks then so be it. When investing you have to accept the risks as well as rewards. Having said that, I don’t invest in something that I think is going to fail. I believe it will do well. I really do think that the Volt is going to be a major overhaul of what an automobile should be, or at least a stepping stone to something even more advanced. It is far more than technology to enable us to get from point A to point B. It is technology that will over time help mankind better itself.
+1
Aug 19th, 2010 (9:02 am)Like you…. I do not get the hydrogen tech research still going on.
The promise has been fuel cell tech will be in cars in “next 10 to 15 years” ……..
That comment has been made for THE PAST 45 PLUS YEARS!!!!! ????
-1
Aug 19th, 2010 (9:03 am)The key for long term EREV enthusiasm is, ironically, fuel economy. That is, the fuel economy of its ICE motor. If it can’t break 40, then don’t buy too much GM stock.
Aug 19th, 2010 (9:05 am)I was going to ask the same question but you posted first. So as “N RILEY” noted…. does anyone know what that statement really means???
Aug 19th, 2010 (9:10 am)CORRECTION to my own post:
The US Treasury will only sell 20% of the Governements 61% stake in GM through this falls IPO. Thus, only about 12% of GM’s total value will be offered in this IPO. The 20% government stock sale will reduce the US Government holdings from 61% down to about 49%, removing the ‘majority owner’ mantra from the US Government.
I do reiterate that the Governement will still own 49% of GM and that those shares will be sold off over time so there will be plenty of opportunity to buy GM stock in the future. While there is always some ‘sex appeal’ in acquiring stock through an IPO, the key quesiton is how much the stock is valued at on the day the IPO hits. Give there is still a 60-90 day window leading up to the actual IPO, there is plenty of time for both GM and the Government to hype up the stock, which may result in a higher opening valuation than might be expected.
I’m not predicting anything, but there have been plenty of splashy IPO’s that shot up 20-50% in the opening hours and days, only to see the stock price drop to below IPO levels just 60 or 90 days later. A123 is just one recent example.
Aug 19th, 2010 (9:11 am)The question that has been haunting me is — What is the life expectancy of the Volt. Clearly for commutes of 20 miles or less, the engine should not be the gating factor. Bearings and electric motors can easily be designed to last decades. Will we see a junk yard full of volts with their batteries removed or will there be economical battery replacements to extend life? How about third party replacements? In that case, we may be looking at the first routinely one million mile car.
Seems like the economy and ecology of this could be a big part of the marketing pitch, but is GM building in end of life so they have a long term sustainable business? Food for thought.
+1
Aug 19th, 2010 (9:13 am)May the now defunct (RIP) Saturn Vue PHEV would be mixed/melt between the incoming (at least here in Canada) Chevrolet Orlando and the Voltec technology, as GM teased us earlier this year with the MPV5 concept ?
Aug 19th, 2010 (9:14 am)I agree. If the CS mileage doesn’t break 40 mpg then this technology is going to be a disappointment. The promise of the EREV is that it’s supposed to combine the best features of gas free driving of a pure BEV and high fuel efficiency of a conventional hybrid. If it can only achieve half of that equation, then EREV technology will probably be a dead end.
+4
Aug 19th, 2010 (9:15 am)I don’t know why so people are so angry at the “old” GM. I’ve lost sooooo much more money on other companies that have gone under. I don’t hate those companies for it; it was MY decision to buy their stock… it’s not like someone from these companies put a gun to my head to buy.
Not to sound smug here, but since I bought GM bonds rather than stock, GM still exists in my investment portfolio, there is the possibility I can make some money.
+1
Aug 19th, 2010 (9:19 am)I fell bad for your loss… but the nature of bankruptcy is most that hold stock and notes lose their stake.
Maybe your better bet might be a way to attack why you were not “allowed to sell your stock? Were you getting it a discount from the rest of us as part of a company plan?
If you want the Gov. to do that bail out why not just ask the Gov to cover everyones loses in the general stock market?
Or to make it really interesting … just think what would have happened if Social Security had been privatized… and a lot of folks also owned GM stock in their SS account. One would have lost double … plus all of the fees they would have been paying to an “investment counselor”
Losing money is never a happy experience…. as most of us know.
-1
Aug 19th, 2010 (9:21 am)#51 Jscott1000 Said:
The promise of the EREV is that it’s supposed to combine the best features of gas free driving of a pure BEV and high fuel efficiency of a conventional hybrid.
Who ever said that?
Only someone who has already bought into a hybrid would even think that.
Aug 19th, 2010 (9:23 am)Currently, natural gas to hydrogen is the most economic source of the gas; however, it is actually CH4 + H20 = H2 + CO2. It also requires a heat input to turn the water into steam. This makes on-board reforming seem less likely, as you would have to carry water along with CNG (and probably burn NG to make the steam).
I have heard of on-board reforming for other hydrocarbon fuels, and a new method for using CNG might be developed. However, any such reformation would result in a release of CO2; which is objectionable to many (imagine the troll posts on gm-h2.com … )
Aug 19th, 2010 (9:29 am)I agree and well stated!
GM really needs to have this car’s “Gas Mileage” match the Prius and other Hybrids, like Ford, …. especially if there is a premium gas requirement.
The $41,000 cost or $33,500 after rebate is not enough of an offset to make the VOLT enough more appealing. “even I have limited financial resources” :+]
I really want to purchase an American made electric and save a lot of dollars on gas use but …..
Aug 19th, 2010 (9:32 am)Remember, the electric car has been “ten years away” for longer than that (and so was “hang on the wall TV,” but they finally got there).
Nor is this a plug for hydrogen fuel cells; the rest of the energy train will need far more research and development before it can be economically deployed (Where does the hydrogen come from? Can you make better use of the energy required in other forms? Thought so. Back to the drawing board, boys). I agree that much of what drives hydrogen research is government money. If this dries up, watch all of the h2 contenders quietly back away.
Even so, don’t count out the power of research. We might all get a surprise.
+8
Aug 19th, 2010 (9:33 am)I have always supported domestic manufacturing to a fault. The moves that GM has made with the Volt to build a home grown product proves just how important it is for civil support to help underwrite the design, development, construction and production of everything associated with it.
How far will we go to continue to support General Motors in these areas? An assembly plant that is owned by a foreign company has state, municipal and sales support but does not offer as much of a return on investment to this country (not necessarily to the shareholder) as does a domestically owned plant.
First and foremost GM needs to create a reputation of building reliable cars when compared to the reputation of the direct competition. Not a small task, but the Fusion has gone a long way for Ford and hopefully the Taurus will be a strong competitor as well.
The GM IPO is a much better investment than Tesla, a lot of domestic manufacturing is dependent on government support and GM is better prepared to work these investments than other companies. The temptation to move everything to Mexico, Korea, South America, China and so forth is strong. Just look at our manufacturing base now. How does GM compare in this area?
I can reference a BP solar plant in Maryland. A new plant was built a few years ago to take advantage of the demand, the technology and tax breaks. No sooner was the plant built and operating that the technology to build a more efficient panel came to market. Not only was the plant obsolete within 2 years, but the plant could not turn around operations cheaply enough to compete against China and was shut down.
Battery technology is moving at such a rapid rate that the LG Chem owned plant in Michigan will be obsolete soon enough. And that is just the battery component of hybrids. How obsolete plants are perceived depends on how well the products are built. The survival of GM depends on a rapid turnaround of the mindset of building quality components of what we have now, ICE powered cars and trucks. What good is a Volt in the showroom if the Cruze has the repair record of Scion? (please check JD Powers before defending Scion, it’s not very good).
How will GM compete domestically is just one component of the company. I have watched intently on GM investments worldwide. Chinese investments in technology and product development will continue to be successful for the bottom line for years to come. The Opel investment will reap rewards over the next ten years, despite the current financial state. All of these components help ensure that domestic plants will not be built without preparation.
Invest in the GM IPO, not for blind faith, but for the realities of business survival around these parts.
GM is stronger than we think, now it needs to be a lot smarter from the mistakes.
-4
Aug 19th, 2010 (9:34 am)I understand buying stock comes with risks, but bankruptcy for the purpose of shedding dept to stay in business should be illegal. If a company goes bankrupt it should be broken up and sold in parts to pay off a % of dept and a % of share value. The Government should not have allowed GM to go bankrupt. The tax lost on capital gains off set by GM stock loss alone will hurt Uncle Sam for years to come. I believe they could have orchestrated a better scenario.
NPNS!
Aug 19th, 2010 (9:38 am)Not venom, LeoK. More like Once bitten, twice shy.
I don’t like the warranty. GM needs to gain customers back.
If it wasn’t for the Volt, I wouldn’t be here. I just can’t see me buying any other GM product again. The Volt is it for me. I have complete faith in their engineers and workers.
But management made the decision to make complete crap in the 80s and 90s.
No offense to you or anyone else who sells, works, and breathes GM. But I can say I am not alone in thinking the way I do.
+1
Aug 19th, 2010 (9:48 am)If I was really in DIRE need of a couple hundred bucks, WHOA just JUMP at that current stock price (and it hasn’t changed much since official announcements were made long ago). Why do you suppose there is ANY value whatsoever? Because someone out there thinks there will be something to be had. Maybe, maybe not. But the pocket change available from actually selling this crap is not something I give a rip about.
There is something to be said for actually discharging this stuff and taking a write off toward taxes. However, thanks to Obama promising to raise my taxes, I might as well wait until next year when the write off will be worth more. I am not ‘Stupid’, and I do my own taxes, including the corporate form. I also note that 1% of the taxpayers in this country pick up 40% of its bills, and if you expand that to 5%, the percentage of revenue goes to 60%. Meanwhile, half of this country’s residents pay no income taxes whatsoever. And yet, Obama has decided I am the cash cow ready to fund his health care. Nope, I’ll save my tax write-offs for when they will do much more good. ‘Stupid’ is not a term that you should use indiscriminately in this case.
Finally, logistics? You can give your shares away to anyone you desire. That end of the equation is fairly easy. As far as GM’s end, well as I said, this would be for MARKETING. They jump through lots of hoops for MARKETING every day. Certainly, they get no real tangible value out of the old crap. But the point would be to sell MORE VEHICLES. No different than any other MARKETING goal right now.
What’s up your butt? Pretty strong reaction! Maybe the thought of it actually happening might tick you off for jumping too soon to unload your worthless (or so you thought) shares?- at least that would be my guess. The stock market is filled with people who kick themselves for acting impulsively. I know this, and watch for the ‘stupid’.
Oh, and PS, you don’t get the deal if you dumped the stock. Like any other stock, if you sold, you SOLD and have no more rights. This only works if the stock is OWNED. After all, it is called a ‘share’ for a reason. You are supposed to OWN a piece of the pie. All those shares are still out there. Did you forget that? Someone else bought YOUR shares. They get whatever rights go with them. Sorry buddy, maybe the thought of that is also what ticks you off.
+2
Aug 19th, 2010 (9:56 am)I’ve been bitten by the poor build quality of GM cars in the past. I have also bragged about the reliability of some of the other domestics I own. I won’t shy away from the domestics because I have first hand experience of what happens to communities when domestic plants shut down. And not just in the automobile industry.
If you have been shielded from the effects of moving plants out of state then I can understand your bias against GM but I don’t forgive them.
A Toyota Highlander out of warranty but with less than 20k miles was on the lift in my brother in laws shop. The water pump seized. Repair bill? $900 included a stripped timing belt and a few other components that didn’t need to be replaced but with the work being done, the jump on regular maintenance was worth adding to the bill. If the car had the GM warranty the cost would have been next to nothing, never mind that GM uses a timing chain.
Some things GM does is working towards building good cars. Repairing the reputation is going to be tough but can be done.
Aug 19th, 2010 (9:57 am)If we can assume at this stage that the ICE fuel economy is inadequate, then EREV will be a dead end unless the ICE end of the equation can be fixed.
Recently a new type of ICE engine hit the news wires when it was reported that Bill Gates and a venture capital company invested around 25 million dollars in the small company who created the motor. This engine is smaller, lighter, and has significantly higher power density which translates into higher fuel economy and less emissions. Perhaps an engine like this could serve in place of the present ICE. I don’t think tooling costs should be a roadblock – if Mazda can tool up for the rotary engine, GM could do it for this.
http://www.autoevolution.com/news/opoc-engine-explained-22609.html
-1
Aug 19th, 2010 (9:57 am)Even worse than that, who is going to spend $22k for a loaded Cruze when you can get a much larger Impala for around $25k.. people expect small cars to be low cost. Dont forget size=value.. its just like buying chicken.
+2
Aug 19th, 2010 (9:58 am)I think you’re wrong when you think others should make you whole because you lost money as an owner of company stock. That’s not how the stock market works. You accepted the risk when you purchased -or earned if you were granted the shares- of stock.
In a bankruptcy the legal priority of paying off investors is in the following order: 1) lenders of secured debt 2) bondholders 3) owners of preferred stock, 4) owners of common shares.
Aug 19th, 2010 (10:03 am)While it is clearly possible to build a Volt by 2010, it likely won’t be the huge money-making, high-volume proposition we’re all hoping for, until Gen II or III. Batteries remain key. Will the LG Chem cells work as advertised? There is cause for optimism, but at best they seem unlikely to be available in anything like industry-changing quantities for a few years.
Gen III batteries have been stated here as “smaller, lighter, higher energy density and cheaper,” as well as “solid state.” Better batteries will be better buffers for on-board generators; which will benefit by becoming lighter, smaller and cheaper themselves. Can GM establish their rights to these emerging technologies?
While there is every reason to expect better batteries down the pike, this is by no means assured. In all, I read this as a “forward thinking,” “these are our risks” kind of statement, not as a fatal revelation, or anything particularly concerning where our special interest in the Volt is concerned.
Unless something goes horribly, horribly wrong.
Aug 19th, 2010 (10:03 am)The picture is MUCH more complicated than you think it is. If a company disappears, its assets go somewhere- to creditors, bondholders, shareholders, etc. Trying to paint a picture of bankruptcy- well that’s why some accountants and lawyers specialize in this stuff. Unfortunately, by the time bankruptcy is on the table, there is normally nothing left for a shareholder to consider. But then again, that’s why public corporations exist in the first place. The shareholder is on the hook for nothing more than the price of the shares. Individuals incorporate all the time just so that if the leverage stuff backfires, they don’t lose personal assets.
+4
Aug 19th, 2010 (10:05 am)Yeah, they blew it by linking up with loser Google! I’m guessing you have never used Google Navigation. It is completely awesome with both satellite and street views in addition to the standard map views. The natural language interface and natural language query is also spectacular. Want to go to the Picasso exhibit but you’re not sure at what museum it is. Just say “the museum with the Picasso exhibit in Atlanta Georgia”. Need to pick someone up at a restaurant? Just say “Fish Market in Del Mar”. (If there are more than one you get a list). It is such an advance it makes other navigation systems I’ve used look outdated.
Aug 19th, 2010 (10:06 am)Totally OT, but I forgot to ask CG this on yesterday’s post.
What is the Preferred Pricing on the Chevy Volt?
Is there an EVA (employee vehicle allowance)?
Can you use GM credit card cash to reduce the price further?
Thanks.
+6
Aug 19th, 2010 (10:08 am)The federal government had a larger interest in trying to save GM and Chrysler. They were trying to save jobs, the regional economy of Michigan, Indiana and Ohio, and a whole industry sector in the U.S. They used ownership of the companies as leverage to get much needed changes in management, fleet fuel efficiency requirements and labor concessions.
Its been stated by economists that if the feds hadn’t “bailed out” the US auto industry, they would have paid out the money anyway by paying more people unemployment, Social Security and stimulus funds to state and local governments because the US economy would have gone into a full blown depression instead of the severe recession we have suffered. The money spent would have been a wash and we would be worse off as an economy. Tough times call for tough choices.
Aug 19th, 2010 (10:16 am)GM should continue with hydrogen research as long as the government is funding it!
Remember, most of that funding is going towards the rest of the electrification components. When the government pulls the plug, so will GM. At least they should to concentrate on technologies that will be used this decade.
+5
Aug 19th, 2010 (10:16 am)You know Rashid, for a guy who spends a lot of time on this web site, you have a big chip on your shoulders when it comes to the company who is producing a product you so much want to get your hands on (the Volt). It’s like you are wasting your life’s energy hanging out here. Although I also say that to myself many times. Enough with the negative! If you’re not happy, why spend so much time here?
-6
Aug 19th, 2010 (10:22 am)GM lost money for *years*. It’s not like they were doing just great and suddenly went out of business one a sunny afternoon. People who didn’t dump GM during the long slide into Chapter 11 were either overly optimistic (much like Volt CS mpg estimates) or just not paying attention. The penalty for either of those two characteristics is “more losses.”
+7
Aug 19th, 2010 (10:25 am)You have to give him some credit for being right about this, BLD. A lot of people do think this way, and it’s going to take GM a decade of good dependable vehicles to significantly change things.
There is a difference between someone who is mostly a positive contributor, but who has some differing viewpoints, and someone who is mostly a negative contributor, who rarely drops something useful almost by accident (take a bow, John-boy).
I know who I’d rather see leave.
Aug 19th, 2010 (10:25 am)Would probably be better to run the fuel cell on CNG. That technology already exists and is still being further developed. Think GM has done research on this too.
Aug 19th, 2010 (10:27 am)Good one!
Sync is excellent voice control software but doesn’t compare to the telematics of OnStar. Now if GM can raise the OnStar and sound system voice control software to the level of Sync, never mind Google, finally OnStar will get the usability it deserves.
+2
Aug 19th, 2010 (10:27 am)I’m surprised that there is so much interest in the GM IPO. IPOs tend to underperform the market in the months following its issue, so there would likely be a better time to buy in months to follow. This is true even if the IPO rises 50% the first day because as an individual investor, you cannot get in on the ground floor with a hot IPO. It’s more likely that individuals would buy near the peak of the day. During the first couple of days when volume and interest is high, the institutional investors sell some of their stock (bought at the issue price) to the general public at whatever premium the IPO is selling for. Once this initial flurry of interest is over, the IPO tends to trend downwards as the speculators (who bought at issue price) sell to individuals.
Another concern is that this IPO is only for 20% of the planned total offering. That means that future IPOs will dilute your earnings per share by up to 80%, which could cause the stock to underperform its industry.
Yet another concern is that GM has $80 billion in unfunded liability to its pension plans and is in highly competitive industry. Whether GM can turn a profit AND meet its long term pension obligations remains to be seen. Finally, we have the whole retooling of the automotive industry from ICE to some other primary energy source over the next couple of decades. In the past, major changes in technology – trains to airplanes, typewriters to computers, horse to automobile – resulted in the demise of old stalwarts of industry and the rise of previously unknown newcomers.
Put all this together with the risks of owning individual stocks and this IPO falls much more in the category of gambling than investing, in my opinion.
+1
Aug 19th, 2010 (10:29 am)After you put the resulting H2 thru the fuel cell you end up with (surprise!) lots and lots of water and heat.. and you can use that to reform the NG.
The famous bloom box works that way, it generates the heat and water that its needed. No excess heat is left for any other use.
BTW, a pure H2 fuel cell car will be a hazard in winter.. they put out lots of water that will coat the road behind with a film of ice.. There has been a report of a chase car getting its windshield cleaned while following an H2 fool cell SUV.
-3
Aug 19th, 2010 (10:29 am)10K this year, 45K next… you have a funny idea of “wisely driving the costs of electric propulsion down through mass production.” Toyota’s system, on the other hand, has had its development costs amortized across about 1.5 million vehicles, so far, and they have the capacity to produce about 480K Priuses per year. There’s a huge cost advantage in that.
-3
Aug 19th, 2010 (10:34 am)To be fair, you’re right. Same peak hp but more torque at the low end, so driveability should be better – unless they’ve gimmicked the ratios to erode that improvement (let’s presume they don’t). Behind the wheel, it’s going to be a better driving experience.
But… who pays more for fuel economy? People who are focussed on mpgs aren’t going to require better 0-60 times. People who want better 0-60 times will buy the Cruze LT (or is it LTZ?) and get the nicer car. People who just want good fuel economy but don’t want to spend a bunch of money will look at this and get a Yaris instead (check FuelEconomy.gov… the real-world Yaris experience is often 40mpg in mixed driving).
Aug 19th, 2010 (10:35 am)I sit corrected.
(Why didn’t I think of that … )
+3
Aug 19th, 2010 (10:37 am)GM looks to sell about 3 billion in mandatory convertible securities…which would convert into shares in the future. Looks like from the S-1 GM isn’t going to be issuing any new common shares from the ‘get-go’, they are rather looking for the government to shake out first, moving at least 20% to bring their 61% under 50%.
Without getting into a opinion, in this case (and quite often between S-1 filings and final execution) the estimate of the amount to be raised is a conservative number. The US government quite likely looks to release more than 20% (I would be shocked if they didn’t), you also have a undisclosed amount from the Canadian and Ontario governments who own a good chunk of the company-12%
+5
Aug 19th, 2010 (10:41 am)Not sure how to break this to you but the only purpose of a Chapter 11 bankruptcy reorganization is so shed debt so you can stay in business.
First we have swallow the contention that the expiration of a temporary tax cut is a “tax hike”. That’s like saying when the tax credits for the Volt expire the government is “raising the cost of the Volt”. Or when the tax credits for more efficient doors and windows expire there will be a “tax hike”. Not very accurate. The Bush tax cuts — the ones that created the current deficit which is going to eat our children — are scheduled to expire on Jan 1, 2011. Letting them expire is hardly a “tax hike”. It’s more like: You had your fun. Now it’s time to get back to reality.
Second, even that isn’t going to happen. Obama is on record as supporting extending the tax cuts for households making less than $250,000 a year and that proposal seems to have broad support. Does this mean that if you make more than $250,000 you’ll see a tax increase? Nope. That’s because until you make about $500,000 you’re paying the alternative minimum tax, and that rate is above even the old rate which would go into the effect when the temporary tax cuts expire. Plus the rates apply to adjusted gross, and with decent tax planning you should be able to bring down $1M in gross to $500,000 in adjusted gross. So if you’re making more than a million bucks a years, yes your tax rate will go up. But that seems only fair since the least people in those brackets could do is pay at the same rate as people in the lower brackets. Why should someone making more than a million a year pay a lower rate than someone making $250,000?
With respect to your “poor me I’m the only one paying taxes” complaint, I’m not buying it. In addition to income taxes, there are things called “payroll taxes”. Just because you don’t pay any income taxes doesn’t mean you don’t pay any taxes. For federal budget purposes there is no distinction between the two. In fact, the burden on working people from payroll taxes is far higher than the burden income taxes puts on higher income workers. Moreover, for the last 80 years payroll taxes have run surpluses, sometimes very big ones, and they have been used to close the budget deficit. In a sense, income tax payers have been given a free ride by a government policy that has taken from those paying payroll taxes and given to those paying income taxes. So if people paying income taxes what to complain about supporting freeloaders who don’t pay their fair share, they might want to look in the mirror first.
+3
Aug 19th, 2010 (10:42 am)Great news. GM free from government interference will be an innovative GM. Congratulations!
+1
Aug 19th, 2010 (10:42 am)Brilliant idea. Also, if the number of shares of old GM still in circulation lowers, the remaining shares are possibly worth (a tiny bit) more after liquidation of the assets is completed. Everybody wins. I would have given +5 if it were possible.
-7
Aug 19th, 2010 (10:48 am)Sure. Just like the old GM!
Oh, wait… that didn’t work out so well.
+1
Aug 19th, 2010 (10:48 am)The largest IPO in US history was $18B. Even if GM could double that, which isn’t likely, you’re well short of the amount needed to eliminate even the US government stake. This is all about getting to under 50% so on the campaign trail the story can be that the government no longer “owns” GM. Nothing wrong with this, just sayin.
+3
Aug 19th, 2010 (10:49 am)The same people who would buy a 22k loaded Civic, look small cars aren’t that cheap anymore.
+1
Aug 19th, 2010 (10:50 am)I have not seen an actual invoice for a Volt yet. That is where any ‘preferred pricing’ figure would be listed (if any). You should be able to call the 1-800 number on the back of your card and ask them what points if any cany be used. The dealers should have better answers for you on this in November.
-1
Aug 19th, 2010 (10:54 am)Because I am pro-Volt. That’s why. If you need to ask, then you don’t spend enough time here.
Aug 19th, 2010 (10:59 am)So far, a couple people have responded to my ‘everybody wins’ scenario with completely pi$$ poor attitudes. I am discussing how to turn lemons in lemonade. Keep sucking on the lemons if you want, that will not bring your lost money back. I will say it again, if you sold, you SOLD. It’s gone. It doesn’t matter whether it is GM or Walmart stock that nobody seemed to want 3 years ago and gained huge steam throughout the recession. If you play the market as an investor, you buy, you sell, you win some, you lose some. If you sold GM, move on from my comment, just as you have moved on from the shares you unloaded.
These shares didn’t go anywhere. Someone either still owns them or bought the ones that everyone else unloaded. Until a judge declares them worthless, they still exist and they represent a ‘share’ of something, whatever it be. You seem to believe that when you sold them, that was it, like they just disappeared like something that ended up in a landfill. A better description would be the recycle bin. Whether someone picked it up out of your recycle bin or simply held onto it for their own reasons, if it turns out there is some marketing value (as I put forth), EVERYBODY WINS. More vehicles get sold. Next-gen GM stock rises in value. More jobs.
If you are the one who whines because you sold it, you have no more reason to complain than if you had been a non-buyer of a stock that went through the roof and you didn’t see it coming. Woulda, coulda, shoulda. Get over it. My suggestion has value; you whiners begone.
And FWIW, my suggested rate of exchange, $1500 in new car for capitalized expense of $7000 would not offset (via my tax bracket) what I could get back via tax deductions. I put this forth as a WIN-WIN to make (some) people give GM a chance who wouldn’t have otherwise and as a way for GM to sell more cars. Don’t Worry. Be Happy.
Aug 19th, 2010 (11:02 am)Not domestics, Crew. I am actually looking for Ford pickup truck.
I’m not saying fixing foreign cars is cheap either.
My issue is management at GM. They are the one who destroyed that company’s reputation.
Not me, not the workers, and the engineers. Management decided to live off of GMs good name. Yet, I’m being blamed for voicing the public perception that GM makes garbage.
Why isn’t GM first in sales in its own country? Is it my fault, your fault, or GM management’s fault.
You are absolutely right, Crew. It is going to take a lot of work and time for GM to repair the good reputation that they destroyed. But honestly, I would buy a Ford in a heartbeat.
+4
Aug 19th, 2010 (11:03 am)Sorry Don, I didn’t mean it to read like I meant the US gov’t would get out completely, that in no way will happen of course.
I meant the government looks to maximize the amount they can get out of the IPO, over and above the 20% (that would bring their share from 61$ under 50%) they are stating.
I should have said, “they are rather looking for the government to shake out as much as they can first.” I thought my second paragraph expressed that, but maybe in too round-about a way. I am known to drone on somewhat, heeh.
Just looking at the financials leading up to this, and public/private sentiment at the moment…if everything stays ‘as is,’ I am penciling in a number around 33% in my mind.
cheers
Aug 19th, 2010 (11:11 am)I think you would do better if they gave you $1500 in New GM stock prior to the opening bell on day 1. When it takes off, you get all of your money back.
+3
Aug 19th, 2010 (11:12 am)Scientists are working on it already. Promising chemistries are tested right now. Same thing for the chargers. Improvements cannot come if there is no need for it. The more BEV on the road, the better.
It will take a few years but we will get there. ICE cars are doomed, sooner or later they will vanish. The sooner the better, actually, if we want to keep earth habitable.
Aug 19th, 2010 (11:17 am)That’s the thing with H2, it’s always 5-10 years away. It’s a red herring. Look behind the curtain for the wizard, the oil lobby is the biggest supporter of hydrogen fuel cell research and funding. As long as we keep waiting for the “perfect fuel” we keep drinking their oil. It’s time to give electrics a try, keep doing research on hydrogen FC and who knows maybe there will be a real breakthrough somewhere down the road, but we need to move forward NOW.
Aug 19th, 2010 (11:17 am)I’m not arguing about the order of investor priority, but to be fair all around the pay off should be tiered and no one should be left in the cold.
1) lenders of secured debt 50%
2) bondholders 20%
3) owners of preferred stock, 20%
4) owners of common shares. 10%
The percentages can vary, but the key here is being FAIR to all.
If everyone was treated fairly the world would be a better place.
NPNS!
-4
Aug 19th, 2010 (11:18 am)Motors Liquidation (formerly known as GM) lost money for years while cheerfully racking up obligations. As a result, Motors Liquidation has more liabilities than assets. The stock is worthless but you want something for it, anyway.
You want something for nothing.
It doesn’t work that way.
-2
Aug 19th, 2010 (11:18 am)And it DEFINITELY doesn’t work that way, either.
Aug 19th, 2010 (11:28 am)From what I’ve heard, the VOLT will not be eligible for any GM Purchase Plans – at least through the first couple of years. No special GM Employee, GM Supplier, Dealer Employee or any other purchase plan – for the 2011 and 2012 model years. And it will not be eligible for GM Card Earnings, at least initially.
I fully commend GM for doing this as it levels the playing field. There will not be enough VOLT’s to go around, so no one should get preferential treatment. Its tough on those who might qualify for one of these plans, but its fair to everyone who wants to be driving a new VOLT.
+2
Aug 19th, 2010 (11:28 am)For example, take vanadium. The Subaru G4e prototype uses a new, next generation lithium-ion battery developed exclusively by Subaru which employs vanadium technology to allow the battery to store two to three times more lithium ions than conventional lithium-ion batteries. A quick charge to 80 per cent of the batteries’ capacity is possible in just 15 minutes.
News are pooring in every day about that kind of research. We are just beginning to see the possibilities.
+3
Aug 19th, 2010 (11:29 am)1) You have not listened to the whole discussion. Yes, there is the tax rate expiration issue. However, funding health care was to come from INCREASED rates on higher income individuals (beyond the tax increases resulting from the expiration). This is to be funded my making the current system more complicated. ALL PAYROLL SOFTWARE WILL HAVE TO BE REWRITTEN to accommodate Obama’s proposals. I know; I write that software. There is no difference in rate in Medicare taxes currently, Obama proposes to change this.
2) Speaking of Medicare, let’s dissect your ‘payroll’ taxes generalization. Like my daughter, I will have to explain for you when I say that 50% of Americans do not pick up ONE DIME of the governments bills. Your ‘payroll’ taxes are made up of a) social security tax, b) medicare tax and c) income taxes. a) & b) are entitlement taxes. Allegedly, they are pay-in and get-out services. They do not pay for the REAL government bills (military, highways, donations to other countries for disaster relief, government employee wages, etc.). Only income taxes pay the government’s bills and HALF OF THIS COUNTRY’S RESIDENTS PAY NO INCOME TAXES http://www.msnbc.msn.com/id/36226444/ I am SOOO sick of people assuming that other people should take more of a burden than they do. Our system of income taxes is so unfair, it is nauseating.
3) You apparently don’t understand Alternative Minimum Tax either. It really has very little to do with income. It is an eliminator of deductions- that’s it!!! More and more middle class tax payers get bitten by AMT when they don’t earn any more than they did a year or two ago. Its problems have been documented AD NAUSEUM! If you live in a high property tax state like NY, you find that AMT wall waiting to greet you every freakin year and you are by no means well off.
I spent far too much time playing the game with you the other day. As I said then, and advised other people to do with you- only debate with you long enough to show other people how screwed up your (seemingly well thought out) rants are. Lord knows, your mind cannot be changed on anything.
+1
Aug 19th, 2010 (11:30 am)I have been “bitten” by almost every car I have owned, including Chevy.
72 Chevy Nova (inline 6 engine) would never start in the winter without starting fluid, and it would stall while running through a water puddle.
74 Nova – Body rusted through like swiss cheese, including the floorboard (I put a carpet over it so I could not see the ground through the hole).
84 Lincoln Town Car – vapor locked during the warmest days of summer, and blew fog through the AC vents during rainstorms.
(forgot year) Dodge Aries – it ate map sensors like candy – they went bad so often, I learned how to replace them myself. Trans and engine both died at 149,000 miles.
00 Hyundai Elantra Wagon – had pretty good luck with this one. Was hell to drive on windy days. Got rid of it after the dealer did a 4-wheel alignment on it at 66,000 miles – it never drove right after that.
04 Honda Odyssey – more interior room, and the best car I have ever owned. Died in a crash in blizzard conditions, but it saved my life before it died.
09 Honda Odyssey – best car ever version 2.0. My current car until I get my Volt.
So Rashiid, it’s not JUST GM. Almost all car makes have problems except Honda (fingers crossed).
+4
Aug 19th, 2010 (11:34 am)That’s a shame. Yet ANOTHER example of ‘don’t put too many eggs in one basket’. I have helped save a lot of people’s investment portfolios with this one common sense approach alone.
Aug 19th, 2010 (11:38 am)It depends when you got into the program and the conditions of the card. Now, the only card you can get dictates rebate dollars for individual vehicles. I am not under that program. The old program’s rules (if you chose to stay grandfathered) enable you to use ANY banked rebate toward ANY GM vehicle (except Saturn, and that is moot now). There used to be no limit to anything, but now, if you stick with my program, you can bank only $500/yr for up to 7 years. I only utilize the card for a portion of my spending, because of this. But, I will indeed be able to use my GM earnings on my Volt purchase when it comes to FL.
+4
Aug 19th, 2010 (11:47 am)It just doesn’t work this way. Life’s not fair! Your allocation scheme doesn’t exist for any company in the real world. The same rules of investing apply to all companies in the US. That makes it EASIER for the potential investor to know what risk they are taking before deciding how much and with what type of investment to make in a company.
+2
Aug 19th, 2010 (11:48 am)Man, where did I say that? I SUGGESTED ITS USE AS A MARKETING CONCEPT. More bad attitude. I hear car commercials every day telling you to bring in your used car “drive it, push it, tow it…we’ll give you $5000 regardless…” It is MARKETING. That old GM stock is just as worthless as your old car, but if it gets you to buy a new one….
Man I thought I brought up a good idea, but all I have done is to motivate people to start being remorseful over their GM stock losses. MOVE ON!!! (if you sold it and get behind the idea if you didn’t,…. whatever) What is the downside of what I suggested? Again, I will say WIN-WIN.
And I didn’t suggest that GM take off so much as to lose money on its cars, either. It is really no different than when they offered ‘employee discount pricing’. It doesn’t matter what you call it. Call it a ‘President’s Day Sale’, whatever. It is a TOOL to use a DISCOUNT to MOTIVATE buyers!!!!!
Aug 19th, 2010 (12:03 pm)Yeah, I might agree, but as you can see, I am having a tough time convincing some that it would serve as a buying incentive, let alone actually GIVING you something of value in exchange.
I think I hit a raw nerve for many here- but obviously only for those who took a beating and actually SOLD the stock. I always get a kick out of people who look at the Dow and decide how they feel about the day. Ultimately, nothing is realized until the stock is actually discharged. The market took a 50% bath a couple years ago, but I didn’t lose anything- because I didn’t sell anything. I recently sold a number of stocks bought four years ago at a profit. And of course, your suggestion is all about betting on GM’s future success- which I agree with.
+1
Aug 19th, 2010 (12:05 pm)Actually, a loaded Cruze is around $25K, which makes me think the Volt (at $33K) is a pretty good deal. I just don’t care for larger vehicles and many others feel the same way. There IS a market for premium small cars and GM is “just” starting to realize it.
I, for one, am glad the Volt is loaded up with options. My next car would have probably been a Buick GS if it wasn’t for the Volt. Now I can have that premium car feel, and still drive electric.
+4
Aug 19th, 2010 (12:11 pm)There are two old topics here that some people cling to: the EV-1 program cancellation and the worthless old GM shares. Everyone’s logical side knows that, ‘what’s done is done’, but for some, their emotional side is NOT done. Combined with the many people that bought a GM lemon over the years, that’s a lot of badwill. It would be fantastic if GM would now go the other way and create a lot of goodwill. Maybe the Volt will help do that. I hope so.
-5
Aug 19th, 2010 (12:20 pm)That “low-speed” part is curious.
Why not fast enough to cover suburb driving, like 50 mph?
+2
Aug 19th, 2010 (12:24 pm)I don’t think that the government should replace the stock either. When you buy stock, you’re at the end of the line in a bankruptcy. Which is what happened. The people who have a legitimate claim vs. the unions were the bondholders. Not the stock holders. And, even there, it’s not that the bondholders got so little, it’s that the union got way more than they were entitled to..
That said, the government had a lot to do with GM decline. I’m not saying there weren’t management mistakes. There were. And the UAW became greedy and out-of-touch with the rest of the country. But the government’s “strong dollar” policy and unbalanced trade deals has hurt the US manufacturing base in ways that go far beyond GM. Or the auto industry.
+1
Aug 19th, 2010 (12:27 pm)Agreed. There were definitely people who held GM stock who were completely unsuitable. And who didn’t understand what they were getting into. But, for that, people need to blame their stock brokers or investment advisers. Not GM.
Aug 19th, 2010 (12:29 pm)In the transit fleet – Oakland-Alameda area – three fuel cell powered full size buses (40 passenger) run full tilt. These are the PEM (poly electrolyte membrane or Proton Exchange Membrane) based. Of the five general types of FC’s – PEMFC run at relatively low temperatures. (Under 100 degrees C) Saw one of these FC bus last month. Very impressive. Very quiet. (Made by Van Hool of Belgium.) Fact: a FC powered EV is the most green and efficient propulsion. For example, there are Euro grid-power FC’s sustained on renewable energy. (There’s some movement here in the U.S. just getting underway.)
With GM offering natural gas powered Vans in 2011, a likewise powered FC is near. Granted, a few here and a few there may not make bottom line. But GM’s fuel cell capability rivals its competition.
On the IPO: For those buying GM, buying common (or preferred) stock beats any stimulus for job-building.
+1
Aug 19th, 2010 (12:36 pm)Bondholders don’t participate in the upside when the stock goes up. In exchange, they get a higher priority in bankruptcy than shareholders. If you want safety, go to the bond market. If you want growth potential, buy a stock. I think that’s fair.
Why is it fair to change the rules mid-game and give people things that they didn’t pay for, at the expense of those who did?
Aug 19th, 2010 (12:37 pm)I understand. I lost money on GM stock too, but I did not have my entire retirement portfolio into it. I plan to buy a small amount again because I believe in the company. Not the best investment strategy, but at least I will put some of my money where my mouth is.
Aug 19th, 2010 (12:41 pm)Have you thought about claiming the $7000 as a loss on your tax returns? It would take 2-3 years, since the max you can claim is -$3000/year. But it would allow you to get some of your money back.
Aug 19th, 2010 (12:43 pm)Once upon a time…
+4
Aug 19th, 2010 (12:44 pm)==================================
The Constitution guarantees us life, liberty, and the pursuit of happiness. …
There is nothing in there about being fair.
That is just how it works.
-2
Aug 19th, 2010 (12:47 pm)Screwing the GM credit cardholders has been one of GM’s favorite pastimes for several years. If you want one of GM’s fleet specials, the GM card can be worthwhile way to get some discount. Otherwise, you’re way better off with your Discover card cashback bonus.
Aug 19th, 2010 (12:52 pm)There were people who got worse deals than the stockholders. All the retirees really got the shaft.
+1
Aug 19th, 2010 (12:58 pm)GM made poor products because they were forced to. By cafe, and by much-higher than the competition structural costs. Etc. When you lose money on each unit sold, but you’re forced to stay in the space because otherwise the government won’t let you sell the products you make a profit on otherwise…What do you expect?
As far as why GM isn’t first in sales in it’s own country…um, it still is. As in, it consistently sells more vehicles than any other company.
http://online.wsj.com/mdc/public/page/2_3022-autosales.html#autosalesE
+2
Aug 19th, 2010 (1:06 pm)I dont think that’s true. Porche’s, Lotus, Tesla, etc.. .these are all small cars that are $$$. Even the Smart car is about $17k loaded, and its a golf cart. I expect cars w/a cheap look and lack of options to be cheap, but really you can’t judge a book buy its cover, and a lot of due dilligence is required by the purchaser to do their research and determine their personal value of the vehicle.
-2
Aug 19th, 2010 (1:08 pm)Every marketing trick has a cost. That $5K guarantee comes back to bite the buyer somewhere or must be shored up with incentives from the manufacturer.
If GM’s products are as wonderful as GM says they are, what’s the need of special incentives for MLQQ stockholders? And why focus on the MLQQ stockholders? Wouldn’t it be better to get some conquest sales; win over the Ford Fusion, Toyota Camry and Honda Accord owners? You just know those people weren’t dumb enough to get stuck holding MLQQ.
Where’s the “bad attitude,” anyway? People invested in old GM and lost. Surprise, surprise. Why should they get a deal?
Aug 19th, 2010 (1:10 pm)The retirees were absolutely hurt the most. But that’s because they had the most invested. There’s no way around that. But on a dollar invested basis, the shareholders lost the most. As in, the full value of their investment. If a common shareholder had his entire nest egg and retirement savings in GM, he lost everything. The retirees didn’t lose their entire “investment.”
And, even if, theoretically, at some point they do, they can always go to the PBGC. It won’t cover all their losses. But it’s something. Shareholders don’t have that luxury.
-2
Aug 19th, 2010 (1:16 pm)You mean, like those who took a beating and sold at $10 in late ’08 or so, instead of waiting for a complete writeoff later? We call those sorts of people “prescient.”
+1
Aug 19th, 2010 (1:18 pm)I forgot to add–there are lot of worker management fights during the 70s and 80s that took their toll on the product quality. The working environment was toxic. And, from what I’ve read, UAW workers took a lot of their “frustrations” out on the assembly line.
The way they saw it, it might hurt the bottom line, but what did they care? The company’s success or lack thereof was completely irrelevant to them. The union mentality was “us” against “them.” Not that the management mentality was that much better…But the union wasn’t exactly innocent either.
Aug 19th, 2010 (1:20 pm)So we meet again, Moriarty, so we meet again.
Aug 19th, 2010 (1:20 pm)I’m sorry if I sounded harsh… Nothing personal. I sold my old GM stock, claimed my loss on my tax return and moved on. I think that people that are still holding onto MTLQQ are expecting to be bailed out by some miracle process that ignores the laws of the SEC.
You are right that the loss is not realized until you sell, neither is the gain. That stock you bought was never worth $7,000… Even if you paid $7,000, the instant after that it was worth whatever the market determined it was worth. And as of today it’s about 50 cents a share. If you continue to hold onto it, it will be utterly worthless.
Old GM owes you nothing. The rules of engagement of the stock market are what they are. If Apple stock drops do I expect to get a deal on the next Power Mac? It’s just not going to happen.
+1
Aug 19th, 2010 (1:21 pm)Actually “prescient” would have been selling in 2005…
Aug 19th, 2010 (1:25 pm)I’m actually considering buying a small amount too. Even though I think it will be overvalued. Mainly because I really really want the IPO to go well…
Aug 19th, 2010 (1:26 pm)See #92, last paragraph.
Yes, I am very well aware of the entire tax picture. One should always know one’s tax bracket so they can quickly approximate the effect of any decision on the tax outcome. For many folks, the answer would be ‘divide by 3′ (approximately 33% tax). So if the brokerage website shows your loss at $7500, for example, you know you’ll get about $2500 back. So in my example, I would be better off taking a loss than getting $1500 worth of new car. But, if I were in the 15% bracket, the new car would be the better choice.
+1
Aug 19th, 2010 (1:29 pm)I bought Old GM strictly as an investment, thinking that the company would turn around and I could make a quick profit. Once bankruptcy became inevitable I bailed out and only lost half my money.
On the other hand, I got in on the Tesla IPO and sold 2 days later and doubled my money.
You win some you lose some, that’s how the market works.
Aug 19th, 2010 (1:33 pm)Oddly enough, Toyota, Honda, Hyundai and even Ford faced the same CAFE rules and somehow managed to stay in business. Nip and tuck for Ford, of course. For years Ford did, in fact, build crap cars (we’ll never buy another). Ford faced the same UAW, too. Of course, the one characteristic that GM had which the others lacked was GM management. Maybe that’s why GM crashed and burned when the others didn’t. GM, for example, brought out an entire division (Hummer) dedicated to guzzling gas, many years after CAFE was enacted.
You know, if GM had spent less money lobbying Washington to game the CAFE rules and just built a decent Cavalier… or Cobalt… well, maybe Cruze, then perhaps they would have had fuel-efficient product to sell.
In fact, you could get along with CAFE, as long as you were willing to pay the fine for selling too many guzzlers. Some manufacturers do that.
On the other hand, when you’re caught with your pants down in the fuel-efficient car market in 1973 and again in 1978 and again in 1980 and again in 1984 and again…. and again in 2008, maybe the penalty for never catching a clue is bankruptcy.
And, if you invest in a company with a solid track record for getting caught with its pants down and nothing to sell when fuel prices spike, maybe the penalty for that is losing your money.
Maybe when you hear one of the principals at that company say, “people don’t want hybrids” when the competition is selling 180K of them per year (Bob Lutz, 2005), maybe that’s a sign to sell out of that clueless company at about $39, instead of waiting for the inevitable.
When you discover that a company you’ve bought stock in is losing money, has negative cash flow, and is still paying dividends, maybe that’s a good time to sell.
Maybe when somebody ridiculously successful like Kirk Kerkorian buys in, sends Jerry York to your BOD and then gives you some pointed advice on what to do to avoid going out of business and your CEO and BOD ignore him and then buy him off to get rid of him… maybe that’s a good time to sell.
Nobody “forced” GM out of business… GM ran itself out of business.
+1
Aug 19th, 2010 (1:34 pm)Actually it was GM that said that we should expect 50 mpg charge sustaining. They have been unusually silent on the subject lately leading to speculation that we can no longer expect that kind of performance.
The EREV will be of great benefit to many no matter what the Charge sustaining mpg is. However, a low CS MPG will change the equation to the extent that for some people a convention hybrid would be a better choice.
Aug 19th, 2010 (1:36 pm)It’s a trade-off like the Prius. Incremental rather than revolutionary change.
More total drivers will displace more gasoline if the battery is fully cycled more often. The battery is smaller and the initial cost lower, therefore more people can afford one. Also, they can put the tech in more car models.
I can see this kind of technology producing cars with well over 100mpg capability in commuter driving. The pay-off comes by using grid energy (plug it in, plug it in..) to charge the battery rather than gasoline.
Once people get used to recharging their car (and batteries come down in cost), larger and larger batteries can be used until we are mostly using battery (grid) power.
This ‘slip it in under the door’ approach rather than slamming mainstream with full EVs will transition us more quickly off of the oil-based economy. Eventually, plug-in hybrids will give way to more and more full PHEV’s as people realize that they don’t really use gasoline any more.
I can see this as being the ‘victory garden’ of this century. As more and more people grow their own vegetables (use grid power for transport), we have better health and lower costs.
The Volt and LEAF guys think this is going to happen very quickly. I am thinking more in the realm of decades to replace millions of vehicles. The mindset of a generation (or two) also needs to give way to a new generation with more conservation sensibilities.
Nevertheless, I still want a Volt! Let’s all get started on our Victory Gardens!
Aug 19th, 2010 (1:39 pm)That sounds really cool. I currently use Google maps in areas of New York that I’m not familiar with. I haven’t tried the voice recognition yet, but now I will.
By the way, completely off topic, but as of last week, we had two Picasso exhibits in New York. At the same time.
+2
Aug 19th, 2010 (1:41 pm)I just think Rashid is a bit moody.
Aug 19th, 2010 (1:43 pm)Flmark, I sure hope you’re right about this — looks like I have the same, grandfathered GM card as you. (BTW, I’m one of the guys giving you +1s, not always, but so far no -1s, if that’s any consolation.)
Twice in the past 10 years I have purchased GM cars (including a Corvette — sorry, CorvetteGuy, I didn’t know about you at the time) and the dealer has first tried to limit my card rebate to $1,000 or $2,000. Then at my insistence they called GM and learned they had to allow the full amount I had accumulated (in one case, $3,500).
But I’ve had my GM card since about the day it was first introduced.
+1
Aug 19th, 2010 (1:47 pm)I wish I could give you +10. Most of the people on this forum are such serious fanboys of BEV and EREVs they think that overnight they can replace the 13 million ICE vehicles sold in this country.
I would love for a Volt to be in my garage, but the reality is that it’s completely unproven technology. An incremental approach would be more fiscally responsible.
Start with a conventional hybrid, add a plug, make the battery bigger, tweak the battery chemistry, eventually lose the ICE altogether.
Even though I am a Volt supporter, at the end of the day the incremental approach tends to yield better results than the game changing technology slammed in at the last minute.
Aug 19th, 2010 (1:47 pm)The U.S. Constitution is great but I like add 10 simple higher rules to live by.
One of which is NPNS!
Aug 19th, 2010 (1:48 pm)I agree with your sentiments. I would never encourage anyone to hold out for anything like I suggested. The stock is utterly worthless, we all know that. (I wonder how Kirk Kerkorian feels.) However, I am totally unaware of anything even remotely resembling this current newGM-oldGM situation.
An existing company has all of this public sentiment to deal with, but all of its financial baggage has been eliminated. It is free to skip off into the sunset forgetting the misery it created. However, if it ACKNOWLEDGES that misery and partially compensates its victims, it serves to not only restore faith, but to establish (or reestablish) market share. You can tell people you have a discount, but if people perceive that they earned the discount- that it is a bit of an entitlement, they might do it just BECAUSE!! It is one of those ‘owner loyalty’ type of discounts with a twist. And IF they do purchase, GM has made a sale- hopefully, the sale of a GREAT product that erases old feelings.
Many purchases are emotional ones. This blows the lid off of that by a mile. EVERYTHING about my suggestion is about emotion- how to see that it exists, that it is indeed completely negative and to turn it around into feeling like they cared about our hardship. Again, everybody wins (assuming new GM is NOW selling something to be proud of).
Aug 19th, 2010 (1:49 pm)What do you do Flmark?
Aug 19th, 2010 (2:00 pm)Well I wouldn’t complain if GM had a Old GM Stock Loyalty discount…say bring in a brokerage statement showing you owned old GM stock and get a $XXX discount. Many of their incentives are arbitrary anyway.
Speaking of loyalty I am extremely upset over how I was forced to give up my GM card because HSBC lowered my credit limit from $14,000 to $300 for no reason. When I called to complain they called it a “business decision” Even after I had used my GM points on three different vehicles over 15 years and had never been late on any payments and had excellent credit. I cut up my card and told them where they could put their $300 limit GM Card.
+2
Aug 19th, 2010 (2:04 pm)Toyota and Honda (and Hyundai) had much lower overall costs. They paid their US workforces less than GM had to pay the UAW. And they didn’t have all the legacy costs of the big three. So they could sell small cars at a profit. (They also had a very profitable market locked in Japan (and South Korea) where the largest market was for smaller cars, so they could share development costs for small cars over a larger market.)
As far as Ford–they were smaller than GM, so fewer legacy costs. Also, they borrowed a lot of money when the credit markets were still open to fund their turnaround.
And maybe the problem is that the vast majority of the US consumer public wasn’t interested in buying fuel efficient cars when gas is cheap. They couldn’t keep producing cars at a loss. They would have been out of business ten years earlier. This is one of the reasons we need a gasoline tax…so that investors have certainty.
And maybe Toyota was facing a totally different economic environment where producing hybrids made sense for them. Again, they had access to the Japanese market and the economies of scale offered there for hybrids. The US consumer is less interested in hybrids than the Japanese consumer. Probably because of lower prices at the pump.
You mean the same Kirk Kerkorian who’s attempt to privatize Chrysler sent it running to Daimler? His whole point was to replace Wagoner with Carlos Ghosn. What makes you think the man could have run three auto companies? Especially one with as at a big structural disadvantage as GM?
By the way, he didn’t do too well with Ford…
Aug 19th, 2010 (2:17 pm)Thanks for answering this question, CorvetteGuy. My dad is retired from GM, so I was able to receive a discount when I purchased my 1999 Pontiac Grand Prix GTP. So I suppose I could also receive a Volt for under MSRP, assuming I can find a dealer that will actually sell me one. From what my dad told me, he doesn’t think that’s very likely. At least the dealer I’ve contacted is willing to sell the Volt for MSRP, so I’m not complaining!
-2
Aug 19th, 2010 (2:18 pm)Many apologies Laura, but I’m not buying this one.
While GM was busy making garbage, the foreign carmakers moved in and beat them up.
As for not being number one, it looks like Ford, then Toyota, then Chevy.
http://online.wsj.com/mdc/public/page/2_3022-autosales.html
Looks like we are looking at two different charts.
Ford F series wins first place while GM as a whole wins overall. I missed this the first time around. I still stick with the rest of what I said though. GM needs to prove themselves and dig out of the bad reputation they have. Volt is for me. No other GM product will ever occupy my garage unless GM wants to make good on the complete piece of sh!t Pontiac I owned back in the 1980s. Once bitten, twice shy.
Aug 19th, 2010 (2:20 pm)lol. +1 to you, Pete.
Aug 19th, 2010 (2:26 pm)For some reason, I am completely off my rocker today.
This is rare, but it does happen. I don’t feel any different, but when my wife tells me I am being an a$$hole, (she never says that to me, except on these kind of days) I know it is time to shut my mouth, or in this case, my keyboard.
Many apologies to all.
Please have a good evening.
- Rashiid
Aug 19th, 2010 (2:28 pm)Haven’t you figured that out? I sit around all day long and type on this blog…
Boy, wouldn’t that be a great way to make a living?
Bio is too long… but you can link pieces together from past forum posts- used to teach Navy nukes, I do my own accounting, write software and fight with utilities over billing for a small business. I went to HS reunion last month; everyone asks what you do. I decided on the two easiest answers: a) retired (from being a naval officer) or b) I do lots of things and get paid for none of them. Actually, I did post two links here one time to discuss the ‘greenness’ of the home and the office. Here they are again. http://www.youtube.com/watch?v=KMOCPGLqoGI and http://www.fox4morningblend.com/videos/96470599.html So, if you want to have the question answered, you’ll have to be subjected to my green rant
And I am thinking of taking on this as a second third (or fourth) career: http://www.youtube.com/watch?v=Wq58zS4_jvM (for sure, I am going to make it the ringtone on my next phone)
+4
Aug 19th, 2010 (2:29 pm)2-mode hybrid needs to shift gear at around 40 MPH (and stalling). I wonder if 2-mode is capable of EV speed greater than 40 MPH.
See the Escalate hybrid acceleration: http://www.youtube.com/watch?v=3FXgeQeOO2w
Aug 19th, 2010 (2:35 pm)This is the point I was trying to make at #24. This IPO, on like most IPOs will not raise lots of money to fund growth. But is really just the sale of some government owned shares. Not saying that’s bad. It is what it is.
+3
Aug 19th, 2010 (2:44 pm)“a PHEV, using a modified version of GM’s Two-Mode Hybrid system and advanced lithium-ion battery technology, is scheduled to launch in 2012. The PHEV will provide low-speed electric-only propulsion, and blend engine and battery power to significantly improve fuel efficiency.”
I wonder what low-speed electric-only propulsion means? If GM’s modified Two-Mode Hybrid system can’t beat the Ford Fusion 47 MPH electric propulsion and 41/36 city/highway mileage with a comparable size and weight car then GM need to go back to the drawing board.
Aug 19th, 2010 (2:52 pm)Boy, that stinks! I knew the credit market was getting weird, but I don’t get that one at all. I too have had my GM Card since early on (1992) and have now bought 4 vehicles with it. I actually do feel a bit more empathetic to your hostility now. I would be hopping mad!!! That GM card sitting in my wallet is a tiny little reminder (and incentive) to err on GM’s behalf when I make car decisions. If it was yanked away from me, as it was with you, I might actually be more in the Leaf camp (although the Leaf is still just so blasted ugly- and I know my wife would not let me get it if it was an ugly car, since she would be driving it most).
I feel your pain
+3
Aug 19th, 2010 (2:53 pm)There were many many reasons for that. We can start with a very undervalued pegged currency, cheaper labor, unionized workforce in the US (so they could automate as much they wanted), go onto cartels (artificially cheap loans), and an activist government that aggressively protects their home market. (So that they can use the profits there to fund R&D, etc.)
It’s the reasons we’ve lost most of our manufacturing base. You could repeat this story across our electronics industry. Most of which is history. They can’t all have been victims of bad management. GM survived the 70s and the 80s. Unlike most of the others. I think they deserve some credit for that.
+2
Aug 19th, 2010 (2:55 pm)Well, I have to say it’s people like you who really get me going each day. Every thing you say will happen in do course or has already happened.
Cost will come down as GM builds its supply lines. GM has brought the assembly of the battery pack in-house and located that plant close to where the assembly of the Volt is being done at Hamtramck. Similar efforts are under way to manufacture electric motors and power control assemblies under GM; all this will allow them to lower the price to their customers. You don’t structure your business on producing large product quantity and then wait for buyers to stream into dealers showrooms. Skillful marketing requires a reasonable estimate of product demand and manufacturing scales upon that estimate. Nissan plans to EVENTUALLY sell in hundreds of thousands of vehicles but in time we will see how fast that target is realized. GM has to be cautious after just coming out of bankruptcy, and having placed new financial controls in place to insure proper expenditure of the money they have available to scale manufacturing. That was one reason that GM dropt several brands.
It doesn’t seem to me that GM is waiting to see what will happen with technology; it is setting the standard by incorporating infotainment into an automobile.
There is no lack of government support! The stimulus has resulted in construction to begin on several new battery plants in the United States. Just one link of many:
http://gas2.org/2010/07/20/web-of-battery-plants-to-bring-62000-new-green-jobs-to-michigan/
There’s plenty more I could say but I’ll save it for later.
Happy trails to you ’til we meet again.
Aug 19th, 2010 (3:05 pm)Just watched your videos mark, congrats to you and your wife.. Are you gonna replace one of those hybrid suvs with a Volt and add a few more solar panels?
Aug 19th, 2010 (3:06 pm)I believe it was Billy Preston who had a song back in the ’70s, ‘Nothin from nothin leaves nothin’. First off, I would never put all my eggs in one basket. If I had, I might have been ‘on eggshells’ (pun intended) watching the GM fiasco unfold. Given the amount of money I had invested, once it was COMPLETELY clear that the sky was falling (keep in mind GM went into the teens then back up into the thirties), pulling it out was like, well, why bother? It ain’t worth squat and at its current level, I can pick up the tax write off when I can use it- or when the judge says the stock no longer exists- whichever comes first. This recession has reduced our income 20-25%. On top of this, I had my solar write-offs and oh yeah, Obama promised before he was ever elected that he would raise my taxes. So GM sits there on paper doing ‘nothin’ and Billy Preston keeps going through my head today…’ya gotta have sumthin, if you want to be with me’
Aug 19th, 2010 (3:06 pm)To answer the last question first. Not too sure about the NG->H2 part but there is considerable savings using a fuel cell vs burning H2 in an ICE.
Auto makers collect a lot of incentive money from governments around the world to develop fuel cell for cars. I would not be surprised if the government pays 100% and GM is just keen to keep the research money coming in. They still insist that H2 is more promising for larger cars and trucks, vs batteries. I’m sure that will vanish if some of the advanced lithium-silicon-sulfur or lithium-air batteries work out, but these are still many years away. I think fuel cells will have a short lived success in the years from 2015 til these batteries hit the market.
-1
Aug 19th, 2010 (3:10 pm)The labor advantage per car for Toyota vs GM is on the order of $200 – perhaps less. This deficit is EASILY made up with “domestic preference.” Even as of two years ago, 40% of American auto buyers “would not consider an Asian car.”
That’s after 40-some years of the imports busting their humps to win in our market. Initially, the number was far, far higher. This is basically money GM could take to the bank.
Since the number of people who would never consider a “European car” is far lower, I leave it to you to decide whether or not this sentiment is fundamentally racist in nature.
And while Japan and the ROK might be closed, the rest of the world is wide open. I’ve seen first hand the difference in effort that the Japanese and US manufacturers made in other international markets (the Japananese worked just as hard in other international markets as they did in the US, while GM phoned it in). Europe is a strong small-car market, too, and GM had factories there.
I don’t even believe those markets are closed. Now, the Japanese might have a domestic preference of their own but who’s to blame them for that? Especially when their cars have excellent track records. GM sent RHD Cavaliers there, for a time, in the late ’90′s or early ’00′s but nobody would buy them because, frankly, the Cavalier was a crummy car. It was particularly unsuited to the Japanese market because it was about as long as a 7-passenger JDM minivan (maybe even longer) but only held 4 people and two of them in a fair amount of discomfort.
Any strategic markets disadvantage that GM had is strictly one of their own making.
By the by… I’ve lived overseas… Back in the day, a “Made in USA” label was gold. We threw a lot of advantages away.
Why is it that GM would be forced to build small cars at a loss? The playing field is level. If they’re building small cars at a loss, it’s because their operations were fundamentally inefficient. The labor cost difference per car is small. GM had the opportunity for at least nearly equal exposure to small-car markets. The problem is that GM could not switch from guzzlers to sippers when they needed to. GM has bad logistics and inflexible operations. Their reaction to fuel crises, for nearly 40 years(!) is to suffer, channel-stuff, press vehicles into fleets and crank up massive givebacks to maintain share.
Sure, a gas tax would resolve a lot of uncertainty. Who do you think vehemently opposes a gas tax? Me? Nooo… It’s the purveyors of fine gas-guzzling SUVs that would suddenly be excreting hardened clay blocks if a gas tax suddenly loomed on the horizon.
You ignore the point about Lutz. At the time he uttered those remarks, people were lined up around the block at Toyota dealerships to get new Priuses. The man was a genius for getting it wrong. When he finally did develop hybrids, he shepherded two complete losers through the process; the BAS whybrids and the GMT900 two-mode full size SUV, which could still be described as a “gas guzzler” even though, yes, it was a hybrid. As a bonus, it was marketed directly to people proven to not give a rip about fuel economy. And this guy was their “car czar?” If there’s anything in the organization that so richly reveals GM’s utter cluelessness in management, it’s Bob Lutz’ tenure as “car czar.” And post-Chapter 11, THEY BROUGHT HIM BACK!
As for Kerkorian… maybe Chrysler would have been better off if they’d let him in? Look where they are now. And Ghosn might have been a worse choice than Wagoner but, then again, it would be hard to do worse than Wagoner, wouldn’t it?
+2
Aug 19th, 2010 (3:12 pm)Because of UAW, GM and the rest of the domestic car makers could not compete with cheap labor producing cheap, small cars. Even when the US Government took over Chrysler in the ’80s and forced them to make the K-Car, they still had to go back to big cars and trucks to make a buck.
CAFE had the opposite effect of it’s intent by forcing people that need and want high output and capability vehicles from large sedans and station wagons into SUVs and trucks. GM just supplied those needs (whether they were ‘wants’ or ‘needs’ is another story.) but got caught in the constant cycle of gasoline pricing ups and downs. So, now CAFE includes light trucks as well. We will see what havoc that causes in the domestic market. People needing high towing capability will probably need to buy bigger trucks now.
The way to fix it is not CAFE, it’s pricing fuel so that it’s too expensive to have all these toys. But, the US Congress doesn’t have the will to do this (yet).
Yeah, maybe GM didn’t learn from it enough to make small cars (somehow) locally, but, they did learn to diversify into other markets. They just finally got to a place where even that didn’t save them. Rebadging Suzuki’s and Toyota’s didn’t work out so well in the end.
The diversification of GMAC into mortgages probably had more to do with GM’s eventual downfall than any other speculated mismanagement.
Aug 19th, 2010 (3:17 pm)If social security really is separate, then it’s actually semi-solvent. The “trust fund” consist of real dollars that the treasury owes them. So raising the minimum age for social security would have no bearing on our deficits. (Except of course that some people might retire earlier and not pay taxes on their income.)
Of course, they’ve been using SS funds to pay for “real” services for years…so I’m not sure what they’ll do when they have to pay back what they “borrowed”…
Aug 19th, 2010 (3:25 pm)Fact: All the dirty stuff is hidden behind the curtain, making the hydrogen. This is where much more research and development needs to be done.
+5
Aug 19th, 2010 (3:33 pm)I don’t know where you got your numbers, but it’s not just the immediate labor advantage. GM’s pension liabilities are huge. IF you take into account GM’s pension shortfalls, they still have more debt than Ford. After the bankruptcy. And, the UAW wouldn’t let them automate. That’s huge. Also, currency. Or, is that also irrelevant?
European cars command a much much smaller segment of the market. So, for most people, they’re basically irrelevant. Basically, it wouldn’t come up because they’re too expensive. (The cheaper versions abandoned the US market decades ago. Fiat’s now trying to make a comeback. Operative word–trying.)
By the way, I know a lot of people who wouldn’t consider a German car.
I’m not saying that people aren’t racist. There is definitely racism in America. But Asians generally aren’t the target. And, by the way, I a friend who taught English in Japan. Talk about racism…
Really? Then why no South Korean cars in Japan?
Yes. Look at Chrysler now. Kerkorean endorsed the merger that led to that…And, by the way, MGM isn’t doing too well at the moment…
I don’t think Wagoner was that bad. No one could have prevented GM’s bankruptcy, IMHO. And the Ghosn thing was a major distraction at a time when GM desperately needed its management team to concentrate on other things.
+1
Aug 19th, 2010 (3:35 pm)You betcha…and not exactly.
Finances suck for a few reasons. Biggest reason is that FL has RENEGED on funding solar rebate program. In three weeks, I have one of those no pay, no interest for a year loans (for office solar) coming due. I owe $58,000. Conveniently, FL owes me $52,000. Ouch. Trying to get HELOC approved right now- paperwork shuffle mostly, as appraisal shows funds should be there.
Assuming I get this breathing room, life should get much better in a few months. We are very seasonal in FL (I am in NY now- I can take care of my end via Internet, with wife being the transient) and business picks up in November. Advertising blitz (large yellow page ad and mailers) will hopefully let folks (of a mind to) see the green stuff and make a switch for the right reasons. You saw that ‘amalgam separator’- no one has one within a hundred miles. Hope it generates business (but it was the right thing to do, regardless).
THEN…yes, Volt…but still…must wait…hard…but must use brain. Those two vehicles you see, along with Prius, were bought with 3 year car loans in 2008. Son took Prius, but he can’t afford entire payment. Do the math. Ouch. No more cars until all paid off. Then…
VOLT!! Will be wife’s work vehicle. Tahoe Hybrid will most likely become full time NY resident. Family up here will keep over winter. Highlander Hybrid full time FL. But who knows.
I want to stick with zero footprint. You saw the discussion of solar hybrid AC unit at office. Next we will get one for home. THEN…evaluate bills. You see, I am net provider of electricity to grid for most of year. Once AC comes on (in June), I start using up my surplus. [Following discussion shows another big reason my demand billing disappeared] Solar hybrid AC 5 ton unit, in low speed, sucks just 12 amps. 12 SEER unit it replaced used 22 amps. Home unit is a 13 year old 10 SEER unit, so I have to see what electric bill does after that before I decide what to do about more solar panels at house because…
FOLKS, IF YOU HAVEN’T READ ANY OF THIS, READ THIS PART
You don’t want to put in so much solar that you are a net provider to the grid all the time (at least until Feed In Tariffs become accepted). More than likely, the utility will only be required to pay you for excess at wholesale rates. In FL, right now, that amounts to 3 cents/kwh. It definitely WILL NOT PAY to have excess with current regulations in place.
+6
Aug 19th, 2010 (3:44 pm)Agreed. We absolutely did. This isn’t just a GM thing. This about our entire manufacturing base. It’s way past time for the United States of America to start doing what it must to rebuild. Whatever mistakes we made, we need to fix them, learn from them, and move on. Not dwell on them, and keep punishing ourselves for them.
I love my country. And I refuse to believe that we are somehow doomed to a long slow descent into irrelevance. And, even if we are, I’d rather go down fighting.
+1
Aug 19th, 2010 (3:54 pm)Agreed. Completely. In fact, I read an article about a year ago about how Toyota was having problems because they were selling too many Prius’s and not enough trucks…A lot more margin in those…
+3
Aug 19th, 2010 (4:00 pm)If the last GM car you’ve owned was in the 80′s I suggest you try something now (if you don’t get a Volt). I’ve been happy w/all of my GM purchases in the 90′s and 2000′s. Or maybe try on your next car rental.
+3
Aug 19th, 2010 (4:09 pm)Sorry, I keep on adding to this, but GM and Ford both have larger market shares in Europe than Toyota.
http://online.wsj.com/public/resources/documents/info-parischr0609-27.html
But the European auto market is different (different regulations on diesels, etc.), so it’s harder to leverage those platforms here. Look at Volkswagon’s performance in the US. Or lack thereof.
Up until pretty recently, Japan had the world’s second largest auto market. You can’t say that having that all to themselves didn’t give the Japanese auto manufacturers a huge advantage. (4.6 million vehicles in 2009, 5 million in 2008) That market is now in a long term downtrend. And that poses a major problem for the Japanese auto manufacturers…
+6
Aug 19th, 2010 (4:10 pm)“A wise and frugal government, which shall leave men free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned – this is the sum of good government.”
Thomas Jefferson
Aug 19th, 2010 (4:14 pm)Bingo
Aug 19th, 2010 (4:14 pm)How are texuring, door inserts, colors and designs, and seat patterns coming along with the Volt? Have seen several patterns used in the test Volts and Ampera’s. The latest Ampera had woodgrain door inserts which look pretty good. Wonder if any of the interior touches from the Camaro will be used? Will the lightning bolt V logo be incorporated into the interior?
=D-Volt
+1
Aug 19th, 2010 (4:16 pm)Yes. GM must now remain focused on transportation technology and the electrification thereof. Fannie and Freddie have proven that the mortgage business is not one for government or automakers. And GM should remain a transportation company.
Aug 19th, 2010 (4:23 pm)True. It all boils down to breaking the molecular bonds in water. For some, it’s kid’s stuff.
+3
Aug 19th, 2010 (4:33 pm)On further review, this wasn’t as clear as it was in my head. I need to stop doing that…
Anyway, the point I was trying to make was that GM, in the course of its existence, created more wealth in the United States (and possibly the world) than any other company. Period. It also (in conjunction with the rest of the auto industry) did more to build the middle class than just about any other company in history. So, yes, if you look at the old GM as an entity over the course of its full history, it did unquestionably “work out.”
And, for the record, it pioneered a lot new tech in its time. Some successful. Some not so successful.
-5
Aug 19th, 2010 (4:33 pm)GM chose not to fund it’s pension liabilities, preferring to kick them down the road. Ooops… bridge was out.
As for a fuel tax, heck, I’m in favor of it. Who do you suppose would be paying lobbyists overtime rates to prevent passage of a gas or carbon tax? I can even endorse making it revenue-neutral, as I think that’s a plus (reduce balance of trade issues, making us fundamentally stronger – helps improve the economy which, in turn tends to increase tax revenue – turns into a win all around).
However, if you think the manufacturer that’s dependent on selling mass quantities of Silveradoes and fullsize SUVs to eke out a profit is going to endorse a gas tax, think again.
Aug 19th, 2010 (4:40 pm)Um, actually, my agreement was more towards the whole cafe being a disaster part of the post…Yes. Obviously, in retrospect GMAC getting into mortgages was a mistake. (It started in the 80s by the way.) But that’s far from being the cause of all GM’s problems.
But, diversification, in and of itself, isn’t necessarily a bad idea. It works for Nissan. And Mitsubishi. And Sony. And GE.
I absolutely agree that the government should get out of the mortgage business. But if they do it too fast, there would be major adjustment problems. Real estate crashing is not good for the economy. We need a gradual change.
Aug 19th, 2010 (4:40 pm)I’m the same way with Ford about the total pos Mercury I had in 1992. Someday I will forget, but, by then, I’ll be too senile to buy a car.
Until it happens to you, there is no way to explain the total financial devastation of having a Ford-backed loan against a Ford car that has a blown engine. You have zero leverage.
You can’t fix the car because it’s already worth less than the loan. And you can’t sell the car because it has a lein. And you can’t default on the loan (without major credit impact).
Ford mechanics make the judgement with no possibility of appeal.
Ford credit keeps the car and hands you a judgement for the rest of the loan (which it is entirely up to them how much that turns out to be.)
Zero Leverage.
Aug 19th, 2010 (4:44 pm)Lol. ‘Boiling down’ (Mr Pun) isn’t enough energy.
+3
Aug 19th, 2010 (4:48 pm)Yea Verily! In California (SF Bay Area), the best thing to do is put in just enough solar PV to generate slightly more than half the electricity you use. This will actually ZERO your electric bill, thanks to time-of-use rates. This is what I’ve done. In summer the solar earns about $.30 per KWH it generates throughout the afternoon (which is also what you would pay if you used a KWH at that time), then when I get home and turn on the air conditioning in the evening hours I pay about $.10 per KWH. So the power grid serves as a 300% efficient battery (in dollars and cents!) to store my solar power for later use. Putting in additional solar beyond that amount is definitely diminishing returns, because the feed-in-tariffs don’t kick in until I generate enough to offset the second 50% of the power I use, and actually go from there into the realm of excess power generation.
+1
Aug 19th, 2010 (4:55 pm)I don’t think it’s even possible to “fully fund” a pension plan..but, obviously, they fell short of what they should have been contributing.
GM and every other company in the country. Along with every state in the country. And the federal government. It’s the perfect example of short term gain and long term pain. (And, yes, the unions also played a roll. They knew they could get a lot more promised to them, if the company didn’t have to pay right away. And look better to their memberships in the process.) The same way public service unions got to put the taxpayers on the hook while the politicians in office didn’t have to explain the real cost of those benefits to the taxpayers.
In fairness, no one expected either the increase in life expectancy or the skyrocketing cost of medical care.
They already did.
http://www.washingtontimes.com/news/2009/mar/18/gm-chief-says-gas-tax-hike-worth-considering/
http://online.wsj.com/article/NA_WSJ_PUB:SB123725594071950875.html
Aug 19th, 2010 (4:59 pm)Hi,
What I wrote in #19 is that government support like credits for the cars, direct support for building plants and research for fuel cells and things like that will certainly dry up and very fast. After the election the government will have to wake up and cut the spending. Thats just a 100% lock, as money coming in to the treasury will continue to shrink unless they stop sending good jobs overseas (millions of computer programers etc.), government has to start cutting in a big way.
But what I also said was that raising the gas tax will be how the government can support EREV/BEVs (they can offset this impact to truckers by cutting other tax on them). In the meantime GM needs to get the cost of these cars down by ramping up production faster. I know you argue thats exactly what they are doing, but I think they are moving much slower then they could so as to soak the early adopters and buy more time. But I believe time is running short. Next congress will be cutting like crazy to try and restore fiscal sanity, and EREVs and BEVs will need to stand on their own by next year (i.e. price cuts for the Volt).
Aug 19th, 2010 (5:07 pm)You point is a good one and is even better supported by BMW 3 series, Lexus IS, Mercedes C class, etc.
+2
Aug 19th, 2010 (5:09 pm)=D-Volt
+1
Aug 19th, 2010 (5:25 pm)World economy is based on continuous growth. Obviously infinite growth is not possible on a finite world – esp. when it is based on non-renewable resources like oil.
When growth is no longer possible, we will see a whole host of companies, cities, counties, states & countries going bankrupt.
We need a new non-growth based economic paradigm.
+1
Aug 19th, 2010 (5:35 pm)… in other words, a State-run economy like the old Soviet Union’s. There’s loads more to try before we come to that.
… we could redefine “growth” as improving efficiency (not just energy, but space-utilization and general materials useage).
… or find ways to live and work comfortably in less-hospitable regions (many ‘off-grid,’ borderline-survivalist, and closed-cycle life support technologies hint at what might be possible).
… or exploit resources in outer space for humanity. Don’t laugh. We did make it to the Moon and back … 41 years ago.
The world of economics has another name for the non-growth economic paradigm (it’s the same as in the natural balance of life itself) has another name: death.
+5
Aug 19th, 2010 (5:37 pm)It’s always good to have a reliable source of external feedback.
Have a great evening! See you tomorrow.
Be well,
Tagamet
+1
Aug 19th, 2010 (5:44 pm)D@#N#D remorseless edit timer …
The world of economics has another name for the non-growth economic paradigm (it’s the same as the one used for it’s natural equivalent): Death.
+1
Aug 19th, 2010 (5:50 pm)At least you had the grace to admit it, and sign off.
Now Carcus 3, on the other hand … let’s just say I’ll be glad if he spins the wheel of fortune in the morning and decides to be some other body part for the rest of the day.
Aug 19th, 2010 (6:44 pm)Hi #164 Zachary Taylor (Jackson)
Hydrogen can be produce by any number of processes. Once produced it may be used directly, indirectly or stored. Where it can be stored in a number of ways. My reference is Larminie and Dicks “Fuel Cell Systems Explained” see for example Fuelling Fuel Cells. (Same title both editions)
I know there’s virtually zero to little infrastructure to support a production EV. However, a lot of attention by a lot of biggies is being given to processes that can integrate the present fuelling infrastructure in place.
The book on FC EV’s is durability and costs. And both issues are coming together-sort of. Toyota says it could produce a FC EV right now for under $50,000. Sound familiar?
Insofar as durability, U.S. DOE’s guidelines call for 5000 hour reliability for propulsion. Source:
“Polymer Electrolyte Fuel Cell Durability” p.469 (2009)
I think this particular DOE guideline falls far short. The 5000 hr. (under 80 degrees C) figure is suppose to equate to 10 years. My figure is more like 40 years. (or 20,000 hrs.)
Aug 19th, 2010 (7:10 pm)Thank you for this information. The more we all learn about how other folks deal with grid tied solar, the more we can influence our own PSC’s to do the right thing.
Aug 19th, 2010 (7:11 pm)# 162 Loboc Said:
The diversification of GMAC into mortgages probably had more to do with GM’s eventual downfall than any other speculated mismanagement.
From what I understand, the diversification into mortgages and consumer financing almost brought GE down, a year or so ago.
Aug 19th, 2010 (7:17 pm)Charlie H Said:
As for a fuel tax, heck, I’m in favor of it.
Please refer to # 171.
Aug 19th, 2010 (7:30 pm)And in what universe does the “bread you have earned” equate to unlimited subsidized cheap gasoline? Did you produce the oil? Did you create it? Discover it?
Not that Thomas Jefferson was always right–he was a slave holder. Or does your freedom include the right to enslave others? I believe that’s how the south put it before the civil war…
Aug 19th, 2010 (7:31 pm)Everything following this sentence in your comment above pertains to the operation of fuel cells and fuel cell vehicles, and completely side-steps a vast elephant in the technology’s living room.
It really is very simple:
1) You liberate hydrogen from water using electrolysis. Whatever source of energy used to create the electricity becomes the new exploited resource for getting the hydrogen. In the ideal situation, nuclear, hydrothermal or hydro-power would be used to create the electricity. However, most electricity is made by burning coal (in the US), with all of it’s attendant pollution issues (sort of casts a pall over “clean” hydrogen fuel cells).
2) You liberate hydrogen from hydrocarbon compounds using chemistry and thermal energy. Ignoring the source of heat for now, when you remove the hydrogen you have something left over: usually CO2 (same deal).
FINALLY, you have to compete with energy delivery and usage systems which cost much less (economically, as well as in direct efficiency) with the hydrogen made by any method. In short, does the electricity, however made, go farther if you just store it in a battery? Do the hydrocarbons produce more energy for less money than using the hydrogen extracted from it?*
NONE OF THIS addresses the problem of delivering hydrogen and storing it in a vehicle safely, which has received very little attention on the part of most fuel cell enthusiasts (there is research in progress, but most actual vehicles still depend on pressurized hydrogen: and if you want a last energy-consuming nail to put in H2′s coffin, it takes energy to compress the gas which you’ve already used excess energy to separate in the first place).
This statement is mystifying, since on the one hand, you have to compare the existing electrical infrastructure (usable this very second to support a production EV), with the necessary infrastructure for providing hydrogen, which doesn’t exist. If I understand you, integrating hydrogen into the present fueling infrastructure would amount to adding a complete set of tanks, fixtures and metering devices at every existing gas station in the country (or perhaps, you meant adding giant surge accumulators and fast-charge stations to existing gas stations). Either way, you can’t escape the fact that you need non-existent infrastructure to support a hydrogen car (in all but a tiny handful of places), and you actually don’t need any additional infrastructure to start supporting EVs in significant numbers.
Fuel cells using pure H2 are definitely the strongest part of the proposed hydrogen fleet, but facts can be stubborn things: To make the pure hydrogen to run them, you waste energy and multiply cost; and to establish a refueling infrastructure to deliver the gas, you multiply it again to ridiculous extremes.
With electricity from Fusion in vast profusion, perhaps the gas will come at last.
* here’s a hint: the answer is yes.
+2
Aug 19th, 2010 (7:45 pm)I happen to have it on good authority the the edit timer is very remorseful (g).
Be well,
Tagamet
+1
Aug 19th, 2010 (8:01 pm)*Storing* it under enough pressure is no mean feat either, BTW.
Be well,
Tagamet
Aug 19th, 2010 (8:42 pm)This sucks… But if I had solar I would go off-grid. I know conventional wisdom is to feed it to the grid and not have batteries, but isn’t this site all about battery technology? As long as the utility wants to buy your solar at wholesale and you have to buy theirs at retail no one is going to want to produce excess. You are 100% correct.
Aug 19th, 2010 (8:54 pm)The power companies are creating a need for something which may not be long in coming: a special solid electrolyte sodium/sulfur battery just for going off-grid with solar:
http://www.heraldextra.com/news/article_b0372fd8-3f3c-11de-ac77-001cc4c002e0.html
The same company is working on several normal-temperature lithium anode chemistries with the same solid electrolyte, ceramic separator design:
http://www.ceramatec.com/technology/ceramic-solid-state-ionic-technologies/advanced-energy-storage/solid-electrolyte-batteries.php
This suggests several intriguing possibilities.
Aug 19th, 2010 (9:22 pm)How did GM bite you, management or otherwise?
(hard to go wrong with the truck though!)
Aug 19th, 2010 (9:33 pm)The Chevrolet Volt website has been updated to a different format – not sure if there is new content yet.
http://www.chevrolet.com/pages/open/default/future/volt.do
Aug 19th, 2010 (10:02 pm)Yeah. We saw it too. We’re still trying to get more details on the VOLT Lease Program they keep promoting.
Aug 19th, 2010 (10:14 pm)It’s based on positive return on investment, which isn’t exactly the same thing. They’re related. But I think there’s too large an emphasis on growth. Which substitutes for innovation. Or real economic improvements.
Aug 19th, 2010 (11:45 pm)You should read one of the excellent biographies of Thomas Jefferson. For a “limited government” type, he was awfully anxious to expand the power of the Federal government by, for example, arranging The Louisiana Purchase. Do you think the “wise and frugal government” paid for it with cereal box tops?
Aug 20th, 2010 (12:13 am)And finally, speaking of stocks… Does anyone know what’s happening over at Zenn Motor Co (EEStor) ? That stock has almost doubled since Aug 5th…
Aug 20th, 2010 (4:15 am)Hi # 195 LauraM said:
Eco_Turbo: Charlie H Said:
As for a fuel tax, heck, I’m in favor of it.
Please refer to # 171.
And in what universe does the “bread you have earned” equate to unlimited subsidized cheap gasoline?
I guess next you will put forth the hypothesis that Europe’s $8.00/gallon fuel is some of the only non-subsidized fuel in the World.
Aug 20th, 2010 (6:58 am)I want my Volt in Jolt Blue (Transformers 2)!
Raymond
Aug 20th, 2010 (10:06 am)Isn’t this country wonderful? You can go bankrupt, screw the shareholders and bondholders
out of their billions (most held by pension funds) and then offer the mrons in this country yet another opportunity to lose their investments. And there will be some dumb enough to
buy these new shares. You have been warned. History has this bad habit of repeating itself.
Aug 20th, 2010 (10:30 am)Actually….
That said, after sleeping on it, I decided that the slavery comparison was way out of line. And I apologize.
Aug 20th, 2010 (12:36 pm)Keep in mind that S-1s are written by lawyers to present the worst possible case. They do this to avoid class action lawsuits.
Aug 20th, 2010 (3:02 pm)I have a different perspective – all based on personal experiences and observations rather than industry statistics.
When Japanese cars first came to US shores, the quality was pitiful, and the desirability of those cars to US consumers was way off the mark. Those manufacturers learned their lessons well, caught, and for awhile at least, surpassed the Big Three in quality. The quality pendulum is swinging back in the other direction. Much more a parity situation today. The Koreans are also having quite a strong say these days in what constitues a quality automotive value.
I too was burned by GM and Ford in 70s, 80s and 90s…in both personal rides and some lousy experiences with corporate fleet cars. Yet today I would not hesitate to consider the domestic manufacturers’ models in any purchase decision, because today they make among the best there is available for the type of vehicle and price points for which I’d shop.
Aug 20th, 2010 (3:46 pm)The latest survey from TrueDelta.com indicates that, while the domestics are closing the gap, Toyota and Honda still have the lead. The car that is consistently tops in reliability, as measured by what TrueDelta calls “nada-odds” and “lemon-odds” is the Prius. The Accord is also, consistently, an extremely strong finisher.
If you’re ready to move on from Toyota and Honda, you should consider a Hyundai. The reliability of a Hyundai Sonata is nearly as good as Honda but it starts at $2.8K less than a Malibu; you’d be cheating yourself not to consider it. And the Hyundai gets class-leading 35mpg on the highway, has a 2.4L DI engine, standard (!), and makes about 200hp, 15-20% more than a ‘Bu, while it weighs a little less and has a better turning radius. There is a lot in that car to like.