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GM extending employee discounts
General Motors has announced, that employees in the United States, may pass on the savings up to 2 additional people that they know. This comes amidst large sales declines, tightened credit and general worries in the auto industry.
GM is looking ahead to a weak ‘09 and is currently strapped for cash. According to analysts, General Motors burns through roughly $1billion a month in operating losses and has enough cash on hand to make due until mid/end of 2009. Hopefully the worst is over and it will be all rosy from here on in, but it is highly unlikely. One reader has a different opinion on the subject: Is this some kind of “middle way” between employee prices for everyone (which limited GM’s Sept drop to -16% but at what likely will be a massive hit to 3Q earnings and a profitless pull-ahead of sales), and the October counter-poise of “employee pricing for employees only” (as well as GMAC’s decision to ignore customers with FICA < 700? With GM’s resulting Oct08 YOY drop will be about -41%.) So what is GM aiming for? -25% in Nov? Fewer über-incentive-inflicted injuries to the bottom-line? Elimination of profitless sales pull-aheads? More... |
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