If GM Files for Chapter 11...

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If GM files for Chapter 11, how much of an effect with this have on the price of their vehicles? Will we start seeing GM vehicles being sold at massive discounts? What do you think is going to happen?
 

Bill in Utah

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 Originally Posted By: rszappa1
It will not matter... no body will buy a GM....
They are screwed. Every one I've talked to will no longer even look at a GM since they have been in bed with the devil. The firing started it and the devil stating all the "rules" finished GM off. Sad. Really sad. As a long time GM customer and loved every one of them, I will no longer buy a new one. Maybe a used one but I'm done with GM for new. \:\( Bill
 
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I heard a Chevy ad this morning where the announced some sort of guaranteed trade-in value on all new Chevy's sold. I only half-heard the ad, so I don't have details, but I think this is an attempt at damage control should they file. Since I keep my vehicles at least 13 years, resale is pretty much moot for me anyway...... ;\)
 
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 Originally Posted By: Bill in Utah
I will no longer buy a new one. Maybe a used one but I'm done with GM for new. \:\( Bill
I don't buy new. Why buy new, when one can get it for half price when it is 2 years old and has 30,000 miles on it... as I did with my Silverado?
 
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Well, when Chrysler had it's little "Govt Bailout Issue" back in the late 70's, they emerged from it OK. I think a majority of common folk feel that GM was just run into the ground by union and upper management. Once those two are "Bankrupted out", most will feel GM will get back to producing a better vehicle and they will buy. Much like what happened with Chrysler.
 

Bill in Utah

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Different world now then with what happened with Chrysler. I don't remember the demands (like firing CEO, killing off models and lines) that GM is being forced to do. Plus add the economy and most people halting their spending $$ for things they don't NEED. I think *if* GM did the right thing and did not go for "help" and went bankrupt then came back stronger, they would have been better off. The way they went has killed them for the most part.
 
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 Originally Posted By: The Critic
If GM files for Chapter 11, how much of an effect with this have on the price of their vehicles? Will we start seeing GM vehicles being sold at massive discounts? ...
No you will see them sold for what they are actually worth! So sad to loose a company with so much history, but if they were blind to loosing market share for so many years then it was inevitable. I agree that they should have went the bankruptcy route so they could have come back strong.
 
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When Daewoo pulled out of the US a local dealer was discounting the new cars by 30%. (presumably off MSRP, so the actual discount was less.) Resale value on Daewoos is miserable, but admittedly they're the yugo of y2k. Several years later, most of us forget that the chevy aveo is a rebadged daewoo. It would be harder to miss a "new GM" silverado for what it used to be... but they will sell somehow.
 
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 Originally Posted By: Bill in Utah
Different world now then with what happened with Chrysler. I don't remember the demands (like firing CEO, killing off models and lines) that GM is being forced to do.
If I remember correctly, when the Government bailed our Chrysler back then, everybody took a pay cut with the exception of the secretaries.
 

PT1

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They are shutting all their plants for Summer to reduce inventory. The spin story is that Delphi is in trouble but the real issue is they need to move out all the existing inventory. Send the workers home for what they believe is a short term. Then file and never call most of them back. This will avoid worker violence as they will all be at home for 2 months when they pull the plug. The UAW wouldn't dare strike the plants if they think it is a temporary shut down. But if they just shut them off ...there will be riots. They have to file Chapter 11 because that is the only way around franchise law in 50 states for all of their dealers they will pull the plug on. The etimates I am hearing is 50% of GM dealers will get eliminated. The rest will get consolidated into multiple brand dealerships.
 
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PT1

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 Originally Posted By: Johnny
Did I hear this correct, that when GM shuts down for 90 days the workers still get something like 85% of their pay.
Not sure if they still get sub-pay or not. If they do then GM deserves Chap11 for sure. That company has been paying people to sit at home for 25 years now. Then blame their problems on the Japanese...
 
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 Originally Posted By: PT1
 Originally Posted By: Johnny
Did I hear this correct, that when GM shuts down for 90 days the workers still get something like 85% of their pay.
Not sure if they still get sub-pay or not. If they do then GM deserves Chap11 for sure.
Isn't there some law that says if a plant closes down, the workers have to be paid for 60 days afterwards? (Or something like that....) Does this law apply if a company goes bankrupt? If so, maybe the union won't have too much leverage when (if?) GM reemerges from bankrupcy.
 

PT1

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 Originally Posted By: Kruse
 Originally Posted By: PT1
 Originally Posted By: Johnny
Did I hear this correct, that when GM shuts down for 90 days the workers still get something like 85% of their pay.
Not sure if they still get sub-pay or not. If they do then GM deserves Chap11 for sure.
Isn't there some law that says if a plant closes down, the workers have to be paid for 60 days afterwards? (Or something like that....) Does this law apply if a company goes bankrupt? If so, maybe the union won't have too much leverage when (if?) GM reemerges from bankrupcy.
If GM files Chapter 11 their union contract and all other contracts like vehicle warranties become void. The workers get nothing as the company no longer has any authority to pay bills as all of that is handled by the bankruptcy court. creditors & bondholders get first shot, preferred & common stock holders get the next shot but usually by then all the cash is gone. No one ever gets even 1/2 of what they are owed. This is how a company discharges it's debt and remains in business. I am assuming GM would continue at least 1 shift of operations at all 13 of their US plants but the wage rates and work rules won't be anywhere near what they were. If the UAW strikes then GM can hire replacement workers.
 
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