Soon, GM will be “operating at a far more advantageous cost-to-manufacture position than Ford”
Ben Stewart - POPULARMECHANICS
- Sept, 2009
It all depends on it's new lineup --Ed.
For General Motors, the worst is over—maybe. The once-sprawling company is down to four brands. It’s axed nearly half its dealer base, shrunk its workforce and successfully thrown itself at the mercy of the American taxpayer. It’s a sign of just how bad things were at the lumbering giant that analysts regarded all that as the good news.
The question is, What comes next? Now that the company has emerged from bankruptcy, GM insiders are promising a Lazarus act, in which the company roars back to life—or at least stands on its own feet. “We are going to be able to break even at earnings before interest and taxes [when the U.S. auto industry reaches] about 10 million units,” Tom Stephens, GM’s vice chairman of global product development, says.
Assuming the market returns to pre-crash sales levels, the arithmetic looks better than that. “Once it gets back to 13 to 14 million units, you will see profits like we haven’t seen in this industry for a long time,” David Cole, chairman of the Center for Automotive Research, says.
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