Δεν ξέρω αν έχετε πάρει χαμπάρι τι παίζεται... αλά υπάρχει σοβαρός κίνδυνος ο οποίος μπορεί να οδηγήσει σε χρεοκοπία..........

Δεν ξέρω αν έχετε πάρει χαμπάρι τι παίζεται... αλά υπάρχει σοβαρός κίνδυνος ο οποίος μπορεί να οδηγήσει σε χρεοκοπία..........

Δεν ξέρω αν έχετε πάρει χαμπάρι τι παίζεται... αλά υπάρχει σοβαρός κίνδυνος ο οποίος μπορεί να οδηγήσει σε χρεοκοπία..........

sorry για το big post
General Motors Needs a Pit Stop to Brake Slide: Mark Gilbert
March 18 (Bloomberg) -- David Cole, president of the Center for Automotive Research in Ann Arbor, Michigan, blasphemed the auto industry in January by suggesting a U.S. automaker might go bankrupt. After General Motors Corp.'s bombshell this week, his words don't sound so profane.

Here are the lowlights of what General Motors told investors two days ago. Instead of breaking even in the first quarter, it now expects a first-quarter loss of $1.50 per share. Instead of earning $4 to $5 for the year, the best that investors can expect is $2. Cash flow will be a negative $2 billion, not the positive $2 billion the company forecast as recently as Jan. 13.

If you erased the company name from the balance sheet and showed it to a forensic accountant, the recommended treatment would probably be to seek protection from creditors by filing for Chapter 11 bankruptcy. It worked for the airline industry; the board of General Motors should be considering radical surgery before the patient finally turns up its toes.

If you want to insure $10 million of General Motors debt against the possibility of default in the next five years, it'll cost you more than $300,000 a year. That's up from $200,000 in December, and double the cost of protection a year ago.

Seeking Protection

General Motors has a market value of about $16 billion. It owes its bondholders seven times as much, with debts of more than $115 billion. Pension liabilities and health-care costs are crippling the company at a time when its market share is collapsing -- the kind of car crash that U.S. bankruptcy law is designed to avert.

The Pension Benefit Guaranty Corp., a U.S. government agency that insures the pensions of more than 1 million retirees, said last week it's taking on the retirement plans of 36,000 employees of United Airlines, whose parent company, UAL Corp., has been operating under bankruptcy protection for two years.

U.S. Chapter 11 rules give a company protection from creditors while it prepares a reorganization plan. United, for example, is trying to persuade its unions to let it switch to pensions based on workers' contributions rather than guaranteeing set benefits. United, the world's second-largest airline, has $1.2 billion of assets to cover $4.1 billion of liabilities.

Bankruptcy Threat

If General Motors, Ford Motor Co. or DaimlerChrysler AG's U.S. unit went into Chapter 11, several others would be forced into it from a competitive standpoint,'' the Center for Automotive Research's Cole told a Detroit conference in January. I'm not forecasting it, but the threat exists, he said. The Detroit News reported his comments.

In the past 40 years, the number of car brands available in the U.S. has doubled, while the number of models has more than tripled, according to a presentation made by John Devine, chief financial officer at General Motors, in January. Every General Motors worker bears the pension and health-benefit burdens of 2 1/2 retirees.

General Motors, Ford and Chrysler spend more than $8.5 billion each year providing health care for employees and retirees. General Motors alone covered more than 1.1 million people at a cost of more than $4.8 billion in 2003. That's $1,400 for every vehicle it built in the U.S., at least double what its non-U.S. competitors spend. Those health-care costs climbed to $5.2 billion last year, and are forecast to rise to $5.6 billion this year, General Motors said on Jan. 13.

Swamped by Costs

Devine said in January those costs are unsustainable'' and a tremendous drain on earnings and capital.'' The company said earlier this week that ``legacy costs are swamping what is a profitable operation.''

General Motors Chief Executive Officer Rick Wagoner told the Detroit News on Jan. 10 that ``the most important thing for a business is that the base business must be operating well. You look at who went into Chapter 11. How did it work out for all their constituencies, customers and shareholders? It's a mess.''

The horrible truth is that the base business at General Motors isn't operating well. Its share of U.S. auto sales has dropped below 25 percent. Standard & Poor's this week cut the outlook on its BBB- rating on GM, already the lowest investment- grade level, to negative, saying ``the rating could be lowered at any point if we came to doubt'' that the company's financial situation was improving.

Cole from the Center for Automotive Research told the Detroit News in January that the conditions are falling into place like a weather front. Our objective is to give people a picture of what could happen and address it before they have to scrape it off the wall.'' The U.S. auto industry, he said, is on the edge of going out of control. This is absolutely not sustainable.''

There's a twist to Cole's warning about the threat of bankruptcy. His father, Edward, was president of General Motors from 1967 to 1974.