The Wall Street Journal (WSJ) that General Motors (GM) is reviewing its strategy and that as well as the job cuts it is considering selling off or suspending some of its marques.
GM recently decided to put its Hummer division up for sale but the WSJ article implies that the Buick, Saturn and Saab (Stockholm: marques are also under threat, while only the core brands of Cadillac and Chevrolet are considered sacrosanct.
Along with other US car manufacturers, GM has been struggling to adapt to a change in customer preferences in the wake of the soaring price of petrol. The company recently said it would cut back production on its highly profitable fuel-guzzling pick-up trucks and sports utility vehicles (SUVs) and give more prominence in its product line to models that are more fuel efficient.
GM is haemorrhaging cash at around $3bn a quarter, and some analysts believe the company will need to raise between $10bn and $15bn in new capital to keep trading until 2010. Although the company has explored the possibility of issuing new shares to raise funds, the fact that the shares recently hit a 50-year low means such a move would seriously dilute existing shareholdings.
subscribe to free newsletter at www.factsonloans.com
the site to give you facts on loans, with the credit crunch, make sure you are making the most of interest rates
No comments:
Post a Comment