Today's Stat

$7,000,000,000

The amount of money General Motors spent between July and September. GM is estimating that it will not have enough money left to operate by mid next year. It would then have to file bankruptcy.



To try to plug the hole GM announced more layoffs and major cuts in capital spending. In other words, they won't be developing new cars. The economy is hurting the entire industry but the Big 3 are suffering far more than other companies because they are not offering automobiles that customers want. If they don't develop new product lines they won't attract new customers.

This is the death spiral of a company. The recession is just hastening it. And on many levels the Big 3 have done it to themselves. They can blame fixed costs for unions all they want and they would be partially correct. But they have also spent decades successfully lobbying the government to keep MPG requirements low so they could build big trucks and not have to develop newer technologies. Now that the reality of high gasoline prices have hit the American public they don't want the trucks.

GM, Ford, and Chrysler shot themselves in the foot and now that they've all but bled out they want us to come in with a blood (money) transfusion.