Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Ask YC: To save GM or not?

news.ycombinator.com

Post reply on HN
Print view View original

41–50 of 74 posts

Re: Ask YC: To save GM or not?

#41

Post by biohacker42 »

thrill wrote: post #34
biohacker42 wrote: post #15

Let them die, but don't let them die now, because now things are bad enough as it is. Think of it as a bail out of everybody else. We're going to spend 3,4, maybe 5% of annual GDP to get through this mess. Might as well use some of that to kick the GM can down the road a bit.

"Let them die, but don't let them die now, because now things are bad enough as it is." Ah - so let them continue to lose $2000 per car for a couple more years, because that'll make things better - meaning what's eventually left is worth even less to whomever finally buys it (likely the taxpayer it seems).

Sure, it will make things better because in a couple more years the economy is in recovery and can absorb the shock better,

It's not like the government isn't planning to extend unemployment benefits because of the economy.

If GM goes bust now then more people will be on the dole for longer.

The tax payer pays for it one way or another.

Re: Ask YC: To save GM or not?

#42

Post by gills »

thrill wrote: post #12
ovi256 wrote: post #7

Earlier quoted context omitted.

If only there were 200 million smart people in the US! By definition, 50% are below average.

Perhaps we need some sort of document that states, and that people in elected office would swear an oath to support, that no matter where you fall in the bell curve, that only you have the right to pursue your own path when deciding what is best for yourself. I just can't think of what to call such a thing.

We could call it "The Constitution of the United States of America". That has a nice ring to it.

Re: Ask YC: To save GM or not?

#43

Post by alaskamiller »

No one will let GM die, especially not a Democrats controlled congress and a Democrat as president. They owe the unions for the votes and no one is brave enough to tell GM -- whom people have worked for multiple generations and who in turn have been taken care of by the company -- to go die. We'll just going to hand them money.

Re: Ask YC: To save GM or not?

#44

Post by mseebach »

vaksel wrote: post #3

it can't be a blank check, if they are going to bail them out that better come with a huge list of demands...forget golden parachutes, demand complete reorganization, huge cuts, new focus. i.e. I'd sell/cut Buick, Hummer, Saab and then go through the brands cutting models. GM makes 89 vehicles and many of them are pretty much copies of each other and compete with each other. Notice how honda only has 10 models, 1 for…

> Startup idea wouldn't really work, it costs way too much money to bring a car to market, and there aren't that many startups in the automotive space, Tesla is pretty much it.

I think that I you set up a incubator with $200mln for pre-seed VC, with a priority for potentially labor-intensive and/or automotive businesses, you'd see some significant job creation. Not enough to offset GM layoff overnight, but at least the solutions provided will be sustainable.

Re: Ask YC: To save GM or not?

#45

Post by rms »

alaskamiller wrote: post #43

No one will let GM die, especially not a Democrats controlled congress and a Democrat as president. They owe the unions for the votes and no one is brave enough to tell GM -- whom people have worked for multiple generations and who in turn have been taken care of by the company -- to go die. We'll just going to hand them money.

If nothing else it's a much better way of spending money than a war.

Re: Ask YC: To save GM or not?

#46

Post by vaksel »

mseebach wrote: post #44
vaksel wrote: post #3

it can't be a blank check, if they are going to bail them out that better come with a huge list of demands...forget golden parachutes, demand complete reorganization, huge cuts, new focus. i.e. I'd sell/cut Buick, Hummer, Saab and then go through the brands cutting models. GM makes 89 vehicles and many of them are pretty much copies of each other and compete with each other. Notice how honda only has 10 models, 1 for…

> Startup idea wouldn't really work, it costs way too much money to bring a car to market, and there aren't that many startups in the automotive space, Tesla is pretty much it. I think that I you set up a incubator with $200mln for pre-seed VC, with a priority for potentially labor-intensive and/or automotive businesses, you'd see some significant job creation. Not enough to offset GM layoff overnight, but at least t…

it costs close to 1 billion dollars to setup a factory to produce a single model. The only reason Tesla is able to do it for a 1/4th of that is because they aren't doing mass production, and their vehicles are using Lotus Elise parts. So the 200 mil will be a drop in the bucket in the auto space.

And even if they did that, the job creation will do no good to the typical worker whose family worked on the same assembly line for 3 generations. Granted some of the jobs will be back when Toyota or Honda or some other successful car company buys GM's assets. But GM is one of the biggest manufacturers in the world, and right now there isn't really that much demand for new cars. I read that last month Honda(whose stuff pretty much flies off the shelf) sold 25% less cars than the year before.

Re: Ask YC: To save GM or not?

#47

Post by redrobot5050 »

blackguardx wrote: post #32
mdasen wrote: post #17

Is it really that GM has failed to innovate? Let's look at the numbers: GM======================================Toyota $1,525 in healthcare per vehicle $201 in healcare per vehicle $73.73 avg cost of a labor hour $48 avg cost of a labor hour 34.3 hours to build a vehicle 27.9 hours to build a vehicle Loses $2,331 per vehicle Makes $1,488 per vehicle So, let's just alter GM's healthcare and labor costs to Toyota's lev…

People latch on to little tidbits and think that they are the reason for GMs downfall. For example, the statement: "GM pays people not to work." Inevitably unions will be blamed somewhere along the line as well. There is more to this story than meets the eye. GM is a factory with a semi-skilled labor force. They produce very expensive goods. Because of this, they don't produce at maximum output all the time. If sales…

The problem is UAW doesn't want to re-negotiate because it knows there's no way it will ever have its standard of living this good ever again. GM and Ford would probably insist on slashing wages by half. Already new hires who are not UAW are put on a different pay and benefit scale to reflect that a machine could do their job. GM has already volunteered 300,000 UAW employees for "early retirement" -- coaxing them to leave the line and retire early -- so they could be replaced with cheaper, non-union labor.

Re: Ask YC: To save GM or not?

#48

Post by DanielBMarkham »

Three points:

1) It's not either/or. GM can declare bankruptcy, renegotiate their debts and expenses, ditch ideas that are not working, and come back as a smaller, kick-butt company.

2) If you go here then it's just a big political hand-out for whoever has the most contacts. It's not a financial bailout anymore. Be honest about it, and expect a lot more applicants.

3) So you spend our money to bail out some business or sector. What is the evidence that the underlying problem has been fixed? I know Congress can attach a lot of feel-good riders onto the deal, like more green energy and better employee benefits, but what assurance is that? Are we fixing the problem, or just putting a band-aid on a gaping wound? 'Cause I got a funny feeling that if you write them a check this year, they're going to be back in a year or two.

They're an important company, and I hate to see them go. But I hate even more the idea that some companies are "too big to fail". Times change. If GM is able to change with them, then that's great. If not, then that sucks. But we don't have buggy-whip manufacturers anymore -- those days are gone. And perhaps the days of super-big American manufacturing companies are going away too. Maybe not. I don't know. But I know you can't force it to work if it's not going to.

Re: Ask YC: To save GM or not?

#49

Post by redrobot5050 »

tc7 wrote: post #16
vaksel wrote: post #3

it can't be a blank check, if they are going to bail them out that better come with a huge list of demands...forget golden parachutes, demand complete reorganization, huge cuts, new focus. i.e. I'd sell/cut Buick, Hummer, Saab and then go through the brands cutting models. GM makes 89 vehicles and many of them are pretty much copies of each other and compete with each other. Notice how honda only has 10 models, 1 for…

Yeah... I read somewhere that the GM bailout should come with the requirement of replacing their current vehicles with a hybrid/electric/whatever lineup in X number of years. I would be happier about a bailout with those sort of strings, but in general, reading that Executives at these car co's have been deriding climate change evidence and the need for hybrids/alternative fuels, makes me skeptical that refunding the…

Sometimes a one time upfront cost is optimal than a high overhead for all your operations. Its like sorting an array of integers (O(nlogn) so you can rapidly search it with Binary Search (O(logn) rather than having to do a linear O(n) every time.

It sucks for the people in Detroit and Michigan as a whole. Their education system has not yet caught up to the fact that the name of the game is "value added".

Also, now that "peak credit" has hit (shortly after peak oil last december) I do not see the trend of American families buying a brand new car every 1 to 2 years continuing. Much more effort is going to have to be spent making your manufacturing base as efficient as possible -- simply because the car buying cycle will likely be an "every five-six years" trend from now on.

Re: Ask YC: To save GM or not?

#50

Post by Cunard2 »

sanj wrote: post #29

The best idea I've heard (can't find source right now) is for the gov't to BUY $100B worth of cars over the next 4 years, replacing their own fleet. A big chunk of that (the $25B floated) could be handed over now in order to design a fuel efficient, safe car with appropriate eco-awareness (hybrid, flex fuel, all electric). This is similar to how military contracts are structured. The bidding could be thrown open to a…

If the US had free universal healthcare, would GM become viable? If the GM employee pension fund owned large quantities of GM stock, shorted it and made a fortune, would this constitute a reasonable hedge against the inevitable demise of their employer?
Post reply on HN