After Wasting $14 billion on Share-Buybacks, GM Prepares for Carmageddon & Shift to EVs, Cuts Employees, Closes 8 Plants

A big shift, at a cost of $3.8 billion – which it now has to borrow.

“We recognize the need to stay in front of changing market conditions and customer preferences,” explained GM CEO Mary Barra in perfect corporate-speak in the statement released this morning, as employees are fretting about their jobs.

The phrase, “changing market conditions,” in regular English means that sales are skidding in the US despite enormous incentives. GM’s new-vehicle deliveries in the US plunged 11% in the third quarter and are down 1.2% for the year. In Canada, GM’s sales have dropped 1.6% so far this year. GM apparently expects these “market conditions” to worsen further, and it’s getting ready for it.

So GM is going to cut 15% of its salaried workers and salaried contract workers. At the end of 2017, GM had 54,000 salaried workers in North America. Of them 52,000 are in the US.

That’s a lot of folks: 15% of those North American salaried workers amounts to 8,100 people. Included in this group are some people who may have already accepted voluntary buyouts.

And “to streamline decision making,” GM will slash 25% of its executives – starting with CEO Barra? Just kidding about the Barra part.

Eight plants to get shuttered.

The statement didn’t mention the fate of hourly workers, but it did mention the fate of eight plants, as GM wants to “accelerate its transformation for the future”:

In the US, GM will “unallocate” four plants. That means production will cease, and the plants will be shuttered in 2019. This includes:

  • Two assembly plants: Detroit-Hamtramck Assembly in Detroit; and Lordstown Assembly in Warren, Ohio.
  • And two propulsion plants: Baltimore Operations in White Marsh, Maryland, and Warren Transmission Operations in Warren, Michigan.

In Canada, GM will “unallocate” its assembly plant in Oshawa, Ontario.

In South Korea, GM will close, as previously announced, its plant in Gunsan.

“Outside North America,” GM will close two additional plants, at undisclosed locations.

“These manufacturing actions are expected to significantly increase capacity utilization,” GM said. It didn’t specify in the news release what would happen to those hourly workers. But it’s not all that hard to imagine.

In the US, this could mean that 3,600 factory workers could be out of a job, though some workers could be transferred to other plants. At its operations in Oshawa, Canada, GM employs currently about 2,500 hourly workers and 300 salaried workers; and they’ll be gone.

The goal of all this is to save “approximately $6 billion” in cash flow a year “by year-end 2020 on a run-rate basis,” it said. This includes cost cuts, such as payroll reductions (see above) of $4.5 billion and a reduction in capital expenditures of $1.5 billion. But this is happening at the internal-combustion-engine side of GM.

EVs are on an entirely different track.

“GM now intends to prioritize future vehicle investments in its next-generation battery-electric architectures,” the statement said. EVs are a lot simpler to build, given the simplicity of their power trains, the absence of emission control systems, and the like. The hard part is the battery, and automakers don’t own the battery-cell technology. This shift to EVs explains part of the “unallocated” plants.

GM “will double” resources allocated to its electric and autonomous vehicle programs over the next two years, it said. This is a massive shift that other automakers are also undertaking, and plowing enormous resources into. EVs are happening on a commercial basis.

But saving money is going to cost a ton: $3.0 billion to $3.8 billion, GM said. This includes “up to $1.8 billion” asset write-downs and pension charges; and “up to $2.0 billion in employee-related and other cash-based expenses.”

This money has to be borrowed, obviously: It “expects to fund the restructuring costs through a new credit facility,” GM said.

The money has to be borrowed because GM blew, wasted, and annihilated $13.9 billion in cash on share buybacks over the past four years (data via YCharts):

During this four-year period in which GM blew, wasted, and annihilated nearly $14 billion on share buybacks, the price of its shares, including today’s 5.5% surge – getting rid of workers is always good news for shares – fell 10%.

But don’t worry. All those expenses incurred during this restructuring will be “adjusted” out of the non-GAAP metrics that Wall Street touts. GM reassured us in the statement that these costs will be adjusted out of EBIT (earnings before interest and taxes), adjusted EPS (earnings per share), and its “automotive free cash flow.” But the cost savings from reduced salary expenses, etc. will be fully represented in all metrics in all their glory. Wall Street’s accounting magic wins again.

We knew “free money would inevitably end,” said megadealer AutoNation’s CEO Mike Jackson. “Affordability would become an issue – particularly around new vehicles.” Read…  “Double Whammy of Rising Rates for Us and Our Consumers”: AutoNation

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  192 comments for “After Wasting $14 billion on Share-Buybacks, GM Prepares for Carmageddon & Shift to EVs, Cuts Employees, Closes 8 Plants

  1. AC says:

    There is probably going to be a nice black market niche in gutting EVs and installing gasoline or diesel drivetrains in them.

    • Nicko2 says:

      EVs are the future. A simple ordinance can make gasoline illegal (or otherwise, unobtainable).

      • Jessy S says:

        I doubt the oil companies would allow for gasoline to be made illegal. Plus everyone depends on gas taxes in order to raise some taxes.

        • sierra7 says:

          Jessy S: You bring up a very good point on the “road repair” gas taxes….What will happen when technology forces a much greater conversion to EV and gas prices get fried and along with that, those gas taxes? Some political innovative thinking going on even as we write??

        • Jessy S says:


          I guess you could say that they will be raising electricity taxes through the roof. Other posters have brought up the power grid. I don’t remember who, but it is already overloaded according to them. Now add the electric car. Imagine them refueling in every garage in the nation on a nightly basis while we are still awake and watching the latest primetime swill being dished out by ABC, CBS, NBC, and FOX. Then factor in the power consumption in both Las Vegas and New York City and the nightly disaster will surpass the 2003 blackout in the northeast.

        • Wolf Richter says:

          Jessy S,

          I’ll just repeat what I said elsewhere on this thread: Power generators and grid operators love EVs because most people charge them up at night at home, when there is a huge amount of excess capacity that EVs profitably use without requiring additional capital expenditures. For utilities, EVs are gravy.

        • Bob says:

          California is already talking about a mileage tax ( since less gas taxes would be collected).

        • California Bob says:

          re: “What will happen when technology forces a much greater conversion to EV and gas prices get fried and along with that, those gas taxes? Some political innovative thinking going on even as we write??”

          California ahead of everybody else, as usual:

        • Jessy S says:


          I was basically answering sierra7’s question and projecting far into a future where the ICE is all but extinct. And that is in conditions where the nation is completely free of power line destroying bad weather and worse. And it even includes Christmas light season which uses up some of that capacity. One million people slow-charging cars through the night isn’t going to do any damage to the power grid.

          But picture over 200 million EV’s on the road and need to charge at night. It is going to be a disaster for the electric grid.

        • Wolf Richter says:

          Jessy S,

          200 million EVs on the roads? That moment is decades away. You’re using today’s infrastructure to make predictions about something that might happens in 20, 30 or 40 years. Things do change over those long horizons. The power infrastructure will be able to keep up: there are profits in it, and those profits will draw investment. That’s how the system works. I’m not worried at all about that.

          This would be a huge change compared to the past decade when electricity sales in the US were essentially flat. And the industry is looking forward to it.

      • BaritoneWoman says:

        In your dreams. There’s still a very long way to go before the infrastructure is in place everywhere for EVs to be charged up. Hint: not everybody lives in a single-family house or has solar panels.

        • Chris says:

          Young people wants a shitty ICE just about as much as a root canal. You only do it if it’s necessary. I live in an apartment and can plug in here, or in any one of a dozen free charging stations. Go to the mall, charge up. Can’t do that with gross gas.

      • AC says:

        EVs are useless in the real world. This appears to be a feature.

        • Wolf Richter says:

          The headline of the article you linked is total BS and I removed the link. GM didn’t kill its EVs. It will double its investment into EVS. What it killed was its Volt, which is the gasoline-electric hybrid. The Bolt (EV) and other EV models are a big part of the future for GM.

        • AC says:

          The article outlined exactly why the models they will continue to sell are useless, after killing off the only type of design that offers any sort of real practicality – and why.

      • Art says:

        The current limited range of EV’s makes them totally impracticable for non-urban locales.

    • fajensen says:

      Nope. Reconditioning and Upgrading of battery packs to “high performance versions” is where the grey-market action will be.

      The battery pack has an embedded computer on it that controls the charging and so on. It also tells the car that the battery pack is worn out and shall be replaced. Until then the car will run at low power to not blow up the batteries.

      Often enough, it will be some of the cells that are gone bad and not all of them and very often people don’t want to pay for new parts for an older car.

      The car manufacturers will use cryptographic techniques to stop “non-OEM” batteries from being recognised by the power train and the hackers, Chinese factories, the modders and whatnot will break the crypto and sell working non-OEM parts.

      Think: “inkjet printers”, only with a bigger, more expensive, proprietary consumable!

      The “fossil-heads” will buy classic cars (Ford F100, Mondeo and whatever will be “classic”) and run them for a few hours a week at fossil car meetings.

      • Anthony Aluknavich says:

        I’m sure the Germans have already cracked the battery code lock software.

      • Kent says:

        “Nope. Reconditioning and Upgrading of battery packs to “high performance versions” is where the grey-market action will be.”

        Hmmm… Li-ion batteries are known to be highly combustible if not tightly controlled. I’d be very, very careful when doing such an upgrade.

        • Harrold says:

          I’ve heard that gasoline is also highly combustible if not tightly controlled.

        • fajensen says:

          The upgrade / refurbishment will be the safer part of the operation, any major trouble with the battery pack comes down the road, so to speak :).

      • Lou Mannheim says:

        Interesting, sounds like overclocking CPUs.

      • Robert McMaster says:

        The roads are everywhere potholled and broken, decaying bridges threaten, aeging nuclear power plants, aeging everything, getting in a bad state of repair, falling apart, no rail service, airports are ancient crap.

        So, what are you going to drive on and where is there to go?

        • Wisdom Seeker says:

          Robert, you should get out more. Everywhere I’ve driven this year and last – cities and rural, thousands of miles, in several states, both coasts and much in between – has had roads in good condition.

      • EchoDelta says:

        I watched this video for giggles the other night. Fix It Chris replaces a Prius battery pack for like fifteen hundred bucks, the car for the same, and sells it for four grand.

        Look how easy it is to swap out refurbished or aftermarket batteries. Cheaper than rebuilding a gas engine. Imagine the aftermarket upgrades that will come from China and other countries that are going full speed ahead on this tech.

        • Chris says:

          Thanks for that link. I had never heard of him before. (I’m a different Chris; if I were making videos they wouldn’t be nearly so clear and well done.) Great video and worth the watch, even for someone who doesn’t own or even plan to own a hybrid.

    • David Calder says:

      Google PML mini QED or open what I’ve just posted and check out the Mini Cooper conversion. 0-60 in 4.5 seconds, 150mph.. 4-160hp electric motors, one to each wheel. The car’s range is 4 hours, about 230 miles, a with a small generator it can do about 900 miles. The coming niche will be ripping out gas engines and installing electric..

      • Alex says:

        Of, course you don’t mention charge time or the reduction in efficiency where there are cold Winters.


    Thank you a trillion times for mentioning the utility of a decade’s worth of stock buyback shenanigans as opposed to the healthy corollary of Research & Development investment, Wolf. I fully agree that the last entire decade has been an exercise in futility due to the stock buyback regime that neglects the bottom line for the bottom line of share buybacks instead.

    Theoretically, R&D was killed outright well before 08 GFC.

    Please take the boots to GM USA for their abandonment of Ontario GM which has been a solid partner to US GM for a century.

    I will now insist that the Government of Ontario & CANADA build our own EVs to teach GM USA a lesson in manners.



    • nicko2 says:

      Canada has the talent, high technology (RIM), robotics and AI, access to cheap electriciy and rare earth minerals; we could be a world leader.

  3. David says:

    Who is there right mind would buy GM junk. At 50k for the most part they are on the down side. I hear a lot of resistance to the outlandish pricing.

  4. You wonder how many of these plants will relocate to even lower wage source destinations? (Mexico) They could be preparing ahead of the recession, then again the uncertainty about trade wars, makes business planning difficult. I don’t think anyone believes the EV car is the answer. If I ran GM I would convert 1/4 of production to CNG and let the aftermarket catch up on the rest. Meanwhile take out a PLOC on my stock portfolio and use it to hedge the market.

    • fajensen says:

      Heh. CNG was tried and never took off in any way. Then E-95 was tried and is now dying on the wines.

      Toyota may succeed with fuel cells and hydrogen because the nice properties of electric cars are preserved.

      Burning “alternative fuels” just gives one less than a normal car: A car with further distance between fuel stations and some more complications in the fuel systems.

      • Harrold says:

        I’d love to have a CNG car. I could refuel in my garage!

        Think of all of the pollution that would save over gasoline or diesel powered vehicles.

        I wonder if I could even charge people to refuel in my garage…

      • roddy6667 says:

        CNG is very big here in China. In my city of Qingdao, we have 6500 city buses (greater Qingdao). About half are CNG. 99% of the taxis are CNG. There are CNG filling stations in every neighborhood. I have seen LNG trailer trucks, although not many. In Thailand, LNG trucks are everywhere.

        • So are those CNG stations retail? In the US they are closed to the public.

        • roddy6667 says:

          Possibly only for the taxis. The buses have their own filling facility. You can buy a compressor for your home in the US and Europe. They are too expensive now, but the price will come down. A compressor for SCUBA tanks might work. Or might blow your house.

      • Rob s says:

        Container ships , cruise ships, ferries, base load power stations are operating with LNG right now. The IMO emissions standards are pushing the ships to install scrubbers or burn low sulphur diesel starting 2020. One way to get compliant is with LNG.

  5. Bill Williams says:

    Many forget that the electricity that powers their EV’s comes mostly from dirty, carbon based fuels. Until all power plants are either solar derived or hydro-electric production, then EV owners are not truly reducing emissions or their true carbon footprint.

    • Wolf Richter says:

      Practically no one who buys an EV cares where the juice comes from. EVs are simpler, nearly maintenance free, cost less in terms of electricity vs gas, and perform wonderfully with their nearly flat torque curve, which gives you all the torque at any RPM, even right from the starting line, without having to rev the engine or having to shift. Drive one, and you’ll see.

      • Marcus says:

        People seem to have a hard time dissociating Tesla the company from Tesla the car. The company may be a mess, but their cars are superb.

        In addition, power plants are far more efficient than combustion engines. That is, if you make enough electricity from a natural gas power plant to electrify 1000 cars, that will result in fewer carbon emissions than running 1000 cars on gas for an equivalent distance. Plus, renewables grow every year. So, it’s about the net effect. Not some delusion about energy sources.

        Also, just because I’m an environmentalist does not mean I’m dumb or irrational. I still fly on planes. I still drive a combustion car. I run my home AC too low. I create CO2 emissions. And I also want to reduce CO2 emissions. It’s called reality. It is one of the many contradictions that make humans human. But I think that broad strokes will make a huge difference. Electric cars are a piece of the puzzle, not some pie in the sky salvation.

      • Lisa Murphy says:

        Got my first EV (Fiat 500e) last year and it’s one of the happiest purchases of my life. I can’t imagine anyone wanting to go back to a gas powered car after owning an electric. The advantages are numerous, but my three favorite things:

        Instant torque when you need it – so good for merging onto the freeway, changing lanes and dodging idiots on the road.
        Near total engine silence. Love that!
        No more trips to the gas station!! Really love that!

        EVs are definitely The Future.

      • Old Engineer says:

        You’ve got it, Wolfe. As usual you hit the nail on the head. Anyone who likes driving would love an EV. I thought my Honda VTEC was impressive but it is nothing compared to what an electric motor can do. The battery tech should improve with time and the cost will come down with volume. You only have to compare the old high compression, carbureted V-8s to my VTEC to know how things will change. (Boy I hated starting those V-8s on a 10 degree morning.) By the way most of the Tesla’s in my area are owned by geezers my age or older and they love them. Even though the dealership is 70 miles away in Nashville.

      • Mike R says:

        One major problem for northerners, that no EV company has addressed, nor likely will be able to anytime soon:
        Battery charging in cold weather climes-

        Specifically, those who live where the temperature goes below freezing (0C, or 32F).

        If you own a cellphone you might have run into this. You go outside in the winter, you expose the phone to cold weather for a while, and suddenly it shuts down, claiming it has no power. You bring it inside and suddenly, without being charged, it starts working again. What happened?

        Did the battery actually shut off? Well, not really. The phone did, however, protect itself (and you) from exploding.

        Let’s start with the basics: Chemical reactions are temperature dependent.

        That is, when its colder outside, chemical reactions tend to occur more slowly.

        Lithium chemistry batteries can deliver current below 0C (freezing) but as temperature drops so does their current-delivery capacity. The same thing happens with the lead-acid battery in your car, by the way, which is one reason that a weak battery can’t start the car in sub-zero temperatures (the other is that the oil is thicker, so it’s harder to turn the engine over.)

        At a certain point — very cold — the electrolyte in a battery freezes. For a lead-acid battery this depends on the state of charge; a nearly-discharged battery will freeze at a much higher temperature than a fully-charged one. In any case if a battery’s electrolyte freezes it is almost-invariably ruined immediately because the case ruptures when that happens, and even if the case doesn’t rupture the cathode and anode are severely damaged.

        With lithium-chemistry batteries, however, there is a second problem which is far more-serious: They cannot be recharged below freezing temperatures without being destroyed and, even worse, rendered permanently and immediately dangerous.

        Batteries work by using a reversible chemical reaction. When they deliver current the reaction runs one way, and when charged it runs the other. When a lithium battery is charged the lithium ions leave the cathode return to the anode, and when discharged the reverse happens through a chemical reaction in which the electrolyte provides the transport. The anode is a graphite compound and those ions intercalate, meaning they become intertwined into the anode’s structure. Because the anode is a layered material this causes the anode to actually expand in size (that’s accounted for in the design of the battery and is normal.)

        The problem is that below freezing (0C) most of the lithium ions fail to intercalate into the graphite. They instead plate out as metallic lithium on the anode. This blocks access to the lattice of the anode and thus transport of the ions; the result of that is a permanent and severe capacity loss along with much higher internal resistance (inability to deliver the desired current.)

        If the bad news ended there it would be bad enough but it doesn’t.

        What’s much worse is that metallic plating is not even. The introduction of lead-free solder saw a new phenomena show up in electronics called “dendrite shorts”; what happens over time is that the metal actually “grows” little spikes and if they grow far enough to reach another connection point you get a short circuit.

        Metallic plating inherently forms these dendrites and they are sharp and uneven.

        Recall that normal charging causes the anode to expand. But now, instead of a nice even surface the anode has what amount to thousands of tiny little pins sticking out of it!

        If mechanical shock or simply a high enough charge rate causes one or more of those “pins” to puncture the separator between the anode and cathode you get a direct short in the cell, the resulting short circuit causes the cell to heat, the electrolyte boils and bursts the case and the flammable electrolyte ignites.

        In other words you get a battery fire.

        Even one charge in a lithium-chemistry cell that takes place below 0C not only will do severe damage to its capacity it also renders the cell permanently unsafe. There is no way to know how unsafe the event has made it; no cell of this chemistry that has been charged while below 0C is safe to use as it can catch fire at any time without warning.

        So if you own a battery-powered car with such cells in it the vehicle has to prevent this from happening. It thus must CONSTANTLY monitor the pack temperature and do whatever it can to prevent the pack from ever going below freezing (consuming oodles of power), because not only will that cause the pack to be unable to deliver its full capacity it is prohibited to charge the pack while any cell in it is below 0C. If the pack is charged in that state it is unsafe, and may short internally, burst and catch fire without warning at any point in the future.

        So when a battery-powered car (e.g. a Tesla) is in your garage and plugged in then it has access to unlimited energy to prevent that from happening. Of course nobody is talking about how stupid it is to have a vehicle that CONSTANTLY must consume power simply because it gets cold in order to defend itself against becoming a firebomb. That’s not very “tree-huggerish”, right?

        Well, tough crap because that’s exactly what the vehicle has to do due to the inherent reality of the chemistry in its battery system.

        What’s even worse, however, is if you drive said vehicle somewhere well within its range during below-freezing temperatures and then park it where it will go well below freezing, and cannot be plugged in, or if you drive it under conditions that are cold enough that heat lost from the pack and its “cooling system” to the outside air becomes problematic, which in either case the car will be forced to consume its available power to keep the pack over 0C — shortening its return-trip range. If you operate it, or leave it out there for any material amount of time, it will consume enough of that power that it is forced to shut down completely, and in that state it cannot be charged until the pack is warmed with some source of external power or the car is towed somewhere warm and given enough time to warm up naturally!

        Of course if it gets cold enough the pack will freeze and be destroyed anyway, but that temperature (for lithium cells) is unlikely in the Continental US to be reached on a sustained basis (no such bets are accepted for northern Canada and Alaska, however!)

        Contrast this with a gas (or diesel, assuming gel-protected fuel) vehicle — so long as you can reach minimum cranking speed required the vehicle will start.

        The irony of all the tree-huggers buying a vehicle, that must continually consume power that the tree-huggers claim to be worried about conserving, when temperatures are below freezing in order to prevent catastrophic damage to itself, including turning into a firebomb, is utterly delicious.

        But if you are in warm sunny California, or Florida, or somewhere that doesn’t have temps that go below freezing, I guess have fun ! (there are other more major issues, such as the fact that the current US power grid, would have to triple in size, to support all cars converting to EV’s, meanwhile, the current grid is in the hole to the tune of AT least $5 trillion behind on maintenance, and replacement, to just maintain status quo.) Oh, but EV’s are going to ‘save’ GM, and the planet from AGW.

        P.s. The above is courtesy of Karl Denninger, over at Market Ticker, who at least has enough brains and technology background to understand some of the many shortcomings of ‘going all in’ on EV’s. Its going to be an interesting niche for a whole lot of years to come folks. Not going to deter anyone from enjoying them now, but beyond being just a VERY expensive niche, that loses money on EVERY single copy made, at EVERY vehicle EV maker, the industry continues to be way over hyped, and not too far from the fantasy and scam that is Bitcoin and Crypto’s.

        • nick kelly says:

          How good is the heater in real cold? The heat from an EC is a by- product. Where will it come from in the electric?
          Repeat: I mean cold. 20 to 30 below.

        • Paul says:

          Apparently Nick Kelly lives somewhere that never gets cold.
          Cold is -20, or -30 here in northern Maine.
          In an electric vehicle, the heat to defrost the windshield and heat the interior of the car must come from the battery, and it takes a LOT!
          Same is true of air-conditioning in hot climates. It takes a LOT of power, and will dramatically reduce the range of the vehicle.

        • nick kelly says:

          I had a typo in ‘EC’, which might have been obvious from the words ‘by product’ which of course is only from the ICE.

          But surely any misunderstanding should have disappeared with words: ‘where will it come from in the electric.’

          I live in Canada where we have hit -40 in Calgary is why I wonder about car heat .

        • max says:

          thanks for this post.

        • Paulo says:

          Terrific comment, Mike, regarding battery structure, operation, etc. Particularly, “and if they grow far enough to reach another connection point you get a short circuit.”

          As I understand Li batts they basically have No internal resistance so when it shorts it does so all at once; almost a runaway process. This results in the rapid heating and subsequent fire. Seconds…no warning.

          Nothing wrong with 50/50 solder, either. I use it all the time from plumbing to electronics.

          Tomorrow, I am finalizing the purchase of a fully restored Westfalia (VW). Gas. 1981, 1.9 litre…everything rebuilt and like new from brakes to electronics. We will probably use it once per week and camp with it on north Vancouver Island off and on year round. In all liklihood it will never leave the Island. At 37 years old it will match my 32 year old Toyota pickup quite nicely.

          As far as I know they don’t make an EV pickup truck and not ever likely to make one that actually works for a living.

          I have a total of $10,000 in my pickup and it looks brand new. That $10,000 includes purchase, all maintenance costs and servicing, plus a recent restoration. With 4 wheel drive it hauls my boat, building materials, gravel, firewood, etc. The heaviest load I have yet to haul is 3500 lbs+, (1500 in the box and 2,000 in a trailer). Bamboo flooring at 48 lbs per box so I know the weights. My last Westfalia was an ’89, and I restored it and painted it fire engine red. We loved that van and drove all over western N America in it. I gave it to my daughter when she got married 15 years ago. She drove it for another few years and then sold it to help with a down payment on a house.

          This is an economic blog. I have crunched the numbers over and over on solar panels to ev vehicles and have come to two conclusions. 1, for city commuters you can buy a whole bunch of transit passes, a lifetime of them, for the price of an ev. It doesn’t pay to own one. Rather, it makes more sense to own a share of a small gas powered car for occasional use if required, or not own one at all. Rent once in awhile. 2, there is not enough range in an ev for me to ever buy one. Hybrid, sure….but the difference in cost of a hybrid and my 9 year old Yaris will pay for fuel and maint. for the next 20 years. Our yaris runs on fumes.

          Once the China rush is over and India chokes a bit longer on smog I see little future in the automobile industry. My old stuff can be maintained by a backyard mechanic. New vehicles need a manual to pop the hood, let alone allow an owner to fix anything. No computers in the ’81. The ’86 has a rudimentary one that blinks a morse code on the idiot light if you short it out…and then it kind of tells you what to fix. I think there are a whole 24 possible issues. New car? hah

          I think the EV rush is an attempt to maintain BAU (business as usual) in how we live. In an energy constrained world it might be wiser to reconfigure cities and lifestyles. I’ll know Society is serious about conservation and AGW when I no longer see jet contrails overhead, or ‘best-bet travel deals’ on the nightly news.

          Bye bye GM


        • Danny D says:

          I guess all those people in Norway are really suffering with their Tesla’s on the cold days, which is about 6 moths a year…

        • char says:

          Within a very short time it will be illegal to run an ICE in a city so there wont be a choice.

          ps. They banned 10 year old diesels in some European cities and London has a much higher toll for diesels than for EV’s. Read for illegal maybe not really banned but really unpractical which comes down to the same

        • Gandalf says:

          I was told once that cars ( with ICE) in really cold places like Vermont came standard with electric engine block heaters which you had to plug in overnight if you wanted to make sure the car would start in the morning. Is that still true? Or did they figure out a way to prevent ICE engine blocks from freezing up in the -40 degree weather? It seems like the lead acid betteries would lose power in that cold weather and not be able to start the engine also, unless they were kept warm with a heater

        • California Bob says:

          re: “New vehicles need a manual to pop the hood, let alone allow an owner to fix anything.”

          I buy manuals for all my vehicles, old and new (currently 8). So that I can fix them.

        • LeClerc says:

          If lithium batteries are fragile in sustained below-freezing temperatures, why are Teslas so popular in Norway?

        • Matt says:

          I agree with Paulo, that this whole EV situation strikes me as just a way to maintain the status quo and avoid making the difficult decisions that will actually fix things. The wise choice would be to restructure the way we live in a way where the decision between ICE and EV is not that important in the first place, ie. where a mistake in the decision of what we all drive is not going to spell our doom. Maybe we could start by redesigning our cities for people instead of cars, like what Strong Towns advocates:

        • Prairies says:

          Answer for Gandalf – All vehicles need to be plugged in up north, from Tesla batteries having a warming setting in below freezing temps to ICE vehicles needing to be plugged in below -4 f to make start up easier. I know many ICE vehicles can start without being plugged in, but it isn’t recommended. EV batteries have to be kept from freezing also or they risk permanent battery damage.

          I haven’t plugged my truck in personally and the only issue I had last winter was frozen fuel lines. Sub -40 will do that and not even an EV can defrost in that weather.

        • Riggald Eux says:

          “the current US power grid, would have to triple in size, to support all cars converting to EV’s,”

          No. Just no.

          The 65% increase in demand* will happen within the current grid’s peak capacity. The demands on the grid will become smoother and more consistent, where today they are very peaky. The grid currently runs iat an average of about 60% use.

          To cope with the 65% increase in daily demand, three things will happen:

          1) We’ll leave wind and solar generating stations running any time they can generate, because we’ll have a lot of big (car) batteries attached to the grid, so there will always be someplace to put that power.
          2) The rest of the generating capacity will be run more of the time. This will improve the thermal efficiency of natural-gas fired plants, as they won’t be spun up and down to match spikes in demand.
          3) EVs will be fitted with Vehicle-to-Grid (V2G) cpability, so they grid can pull back power from the huge number of big batteries any time it is needed.
          4) Home solar installations will continue to increase.

          Annual US grid demand would increase by approx. 65%.

          The grid is designed for peak capacity.

          * 200 million vehicles at 15k miles per year, and 33.3kWh/100 miles = 5MWh/yr/EV

      • max says:

        change from horse and buggy to cars was by way of rich people paying for Research and development of cars.
        But what happen today is that state taking from average Joe to subsides rich in the name of saving planet and progress .
        also what is environmental cost for producing and disposing battery ?

    • MCH says:

      Beyond that, we can also live happily knowing that the batteries and the motors that drives those particular EVs are not exactly clean either. There is no such thing as free lunch, but it’ll outsource the environmental problems somewhere else, like China. Out of sight, out of mind. And it is definitely cheaper than ICE cars when you add up the costs over the life time of the vehicle.

      EVs are fantastic for the environment (if you narrow your view to climate change) and the social credit of the owners especially if you live on the west coast. Lakes of toxic waste won’t be our problem because of our tough environmental laws and rigid emissions requirements makes EV a must. And the best thing is, given how much they cost, the guys who can afford them gets tax credits they don’t need. And when there are enough EVs out there, the tax credits go away, and the guys who scrape by can buy those the good old fashion way… on credit.

      I can practically hear the laughter from here.

      But GM can accelerate their Volt/Bolt production and claim to be on the right side of history as long as they survive the restructuring.

      • max says:

        yes correct Vaclav Smil talk and write similar:

        Smil, V. 2017. Electric vehicles: Not so fast. IEEE Spectrum December 2017

      • California Bob says:

        re: “But GM can accelerate their Volt/Bolt production and claim to be on the right side of history as long as they survive the restructuring.”

        GM is shutting down Volt production with this move.

        • MCH says:

          Oh… well, long live the Bolt I guess. You’re right. I do remember seeing something about migrating away from the Volt. Just didn’t connnect.

        • IronForge says:


          I hope they’re not, or are re-configuring; because IMHO, Gasoline-Electric PHEVs (including Volts) and HFCVs (GM and F have partnered up with TM and HMC) should be able to deal with the Cold.

          HFCVs have reportedly overcome this in 2014; and Hybrids could easily default to their Gasoline Mode at Start for Power and Heat(ing of Cabin and Battery Pack).

          I’m surprised that GM didn’t Roll Out Gasoline-Electric Drivetrains to more Models.

        • Wolf Richter says:

          GM did roll out the hybrid technology to other models, including Cadillac, such as the CT-6 Plug-in. But they didn’t sell.

    • Jim Ferrarin says:

      Not to mention, the world does not have the capacity to simply abandon fossil fuels and go EV, the current electrical grids are near capacity’s already.

      • Wolf Richter says:

        Power generators and grid operators LOVE EVs because most people charge them up at night, when there is a huge amount of excess capacity that could be profitably filled without additional capital expenditures. For them EVs are just gravy.

  6. Ed says:

    So GM and GE both got burned by share buy-back horse-bleep. Nothing like buying high before the bad news comes out. Corporate greed ends up biting the corporate a$$ … and then the little guy ends up enduring the real suffering. I wonder how many more of these buy-backs gone bad stories will come out.

    • California Bob says:

      re: “I wonder how many more of these buy-backs gone bad stories will come out”


      • fajensen says:

        Apple has cash to burn. One could argue that buying back stock instead of making cool iStuff is wasting it, OTOH Apple could argue that reducing liabilities is a good use of their cash.

        Borrowing to buy back stock should be seen as fraudulent behaviour, IMO. Liabilities are increased and the new bonds take precedent over stockholders in every way.

        • Laughing Eagle says:

          fajensen- buying back stocks was illegal until the Reagan Administration got the law passed to change it to legal. That was in the 80’s.

  7. petedivine says:

    I believe GM builds and sells most of its cars in China for China. By shutting down 5 plants in North America I suspect GM is simply abandoning a mature and highly competitive U.S. market for more opportunity in China. GM couldn’t just announce its intentions since Donald Trump and the American public would likely crucify them. Especially when we consider the 2009 U.S. bailout of GM.

    • Rowen says:

      If that’s the case, I’m sure the retaliatory tariffs on US automobiles ain’t helping. Down here in SC, BMW is planning to move x5 production to China. Volvo said it probably won’t even start s60 production here.

    • Mike G says:

      Don’t forget tariffs on steel and aluminum jacking up the cost of manufacturing in the US.
      Putting tariffs on a major commodity input, with 100x more jobs at stake with consumers of the input (manufacturers) versus producers of the commodity (steel and Al makers), is insane.

    • d says:

      After Obama forced the US taxpayer to bail out gm at an indirect cost of over 10 B so he could get the UAW votes. gm became effectively a chinese company with US headquarters, they pay lots of tax in china and very little in the US.

      Of course they dont care about any of their employees anywhere on the planet, most defiantly not the expensive US ones.

      Yet stupid Americans still by their products and consider them a US company.

      some people they never learn.

  8. Anthony Aluknavich says:

    Next from GM will be the dropping of traditional sedans from the product line up. Ford got one up on that game. It’s a good thing they (GM & Ford) as selling a ton of high priced trucks or they would be in deeper do-do.

    • Marcus says:

      Well, yes. That was part of the announcement. Phasing out sedan models in favor of higher margin vehicles.

    • nick kelly says:

      Let’s hope the working wives don’t start asking: ‘why do we have a V 8 truck when we haven’t had anything in the box for 6 months?’

  9. Bart says:

    GM is the shot across the bow. The industry will follow with additional capacity reduction. EV vehicle production is far less costly than IC vehicle production. BTW, isn’t someone pumping more oil to drive down prices and try to squeeze frackers? More and more drive SUV’s and while more fuel efficient than in the past, not as fuel efficient as cars.

    • Wolf Richter says:

      Yes. Volkswagen has already warned many times that the shift to EVs will drastically cut employment at its plants that manufacture ICE drive-train components. This is a real issue.

      • Mike G says:

        EVs cost more to purchase than comparable IC engine cars, so I am assuming the production cost is proportionally more as well. If there is less labor and manufacturing cost/complexity involved with EV engines, where is the rest of the money being spent, what is more expensive to make on EVs?

  10. Bobber says:

    You’d think a company that went bankrupt not too long ago would exercise some caution and conserve its cash. Instead they waste cash on stock buybacks and then find they have to take out loans a minute later. The top decision-makers should be taken out back.

    • Auld Kodjer says:

      You’re going to need a big area out back.

      CEOs and their C-suite cohort respond mostly to the structure of their bonuses. Share buy-backs that boost stock prices are an inevitable consequence of poorly thought through bonus structures. The pathway to greed can often be ridiculously wide and unencumbered – just never illuminated.

      The Chairman and Board set the remuneration structure of the CEO and C-suite. If you want to find poor decision making, look no further than the “infirmary of the connected and decrepit” which passes for Boards of Directors.

      The composition of Boards is strongly influenced by the major shareholders – typically the large funds. If you want to find failed bankers and myopic number-monkeys who never really understand how a business actually creates value, look no further than those fund managers who never leave their glass boxes on Corporate Street.

      You could fill a bloody stadium.

    • fajensen says:

      Incentive structures does work!

      Decades of looting, incompetence and borderline fraud results in: not Ch 7 / Ch 11, not in prosecution, not even the sack, but instead yields a rain of Government Money. Why should GM change what works for them?

      • Jessy S says:

        The rain of money works under the Reagan, Bush, Clinton, and Obama cabal but not to President Trump. Besides, you are forgetting about all the rest of the companies bailed out by the recession including the banks.

  11. Mark says:

    Ever seen a lithium strip-mine ? Nothing comes close in ecological disaster.

    The reprocessing/disposing of the used batteries is a close second. They’re full of sulphuric acid.

    • Joe Banks says:

      Mark good points and I’ll be curious to see if Wolf responds. As most know on this website, I’m not a fan of EVs. Proponents point out how great it is for our environment but fail to recognize the damage done to another’s environment. I could care less about whether or not someone wants an EV over an ICE just as I could care less whether someone wants a Ford, Chevy or Toyota. I just don’t like EVs being slammed down my throat. It’s all about freedom; never forget that freedom is the principle advantage and purpose of an automobile. I could say more, thanks for providing me the freedom to state my opinions here even though you’ve heard them before.

      • MCH says:

        I think for most people, EV is an economic choice. Wolf is definitely right about the virtues of EV, I have a Leaf myself that’s under lease, no maintenance outside of me doing a tire rotation and swapping out an air filter. Charging the car, free for the first two years, and charging at home is relatively speaking cheaper than gas. I am just using a wall plug, sure it takes forever, but for that particular car, it doesn’t go outside a radius of 50 miles anyway. I have a nice ICE car that handles anything longer than that.

        What bugs me I suppose is the incentives and some of the things that goes unmentioned around EVs. First, EV is pretty darn dirty in context considering the stuff we have to dig out of the ground to make it work. I agree it’s overall better for climate change, and I’m all for it. But the incentives are meant literally for people who are rich enough to afford and EV in the first place makes me think that we really don’t have our priorities straight. Think about it, if someone is buying a Tesla or slapping solar panels on their roofs, do you think they really need the incentive to afford it?

        Sure, it’s good for the environment, and I can even understand the economic incentives for the manufacturers, but it sure seems to tilt the field further in favor of the rich. Something that seems to be just swept under the rug mostly.

        • wkevinw says:

          EVs are/will be good for city dwellers (convenience. etc.) Rural folks and “workers” with trucks, not in the cards that I can see.

          All the air pollution calculations I have seen say that the EVs are like high mpg ICE vehicles, e.g. like 60-70mpg levels of CO2 pollution (at the power plant, etc.)

          Battery pollution is usually overlooked. I don’t see how it can be anything but a nightmare. (that is again,overlooked)

      • nick kelly says:

        People aren’t buying Toyotas, Hondas and Mazdas because they are EV or self- driving. They aren’t.

        Sure you need to have an E option but this GM blather is largely a smoke screen for being caught AGAIN with gas guzzling boats.

        The plant in Oshawa Canada. builds Cadillacs, mostly for the US. Who under 70 drives a Cadillac?

        All that has kept GM and Ford alive in NA are V 8 trucks. This is a fad. Most people buying trucks don’t need one.

        It would not surprise me if GM heads to Chap 13 again and blowing a bunch of money playing catch-up on electric cars may hasten the filing.

        Re: ‘self driving’ part of GM’s new focus, Apple co-founder Wozniak thinks it’s ‘vaporware’. Maybe someday but not soon technically feasible. except within narrow limits.

    • Bart says:

      As I understand it, cradle to grave, the EV is more toxic than an ICE auto. Here is an idea, de-tune the ICE cars and massively improve their MPG. Honda CRV diesel in UK gets 70mpg. There is a clean diesel opportunity here too but the 0-60 times won’t be terribly good. With all the improved fuel efficiency, a tax could be used for infrastructure and the total fuel spend with more efficient cars would remain the same.

      • Gandalf says:

        you’ve got it backwards. Internal combustion engines are maximally power and fuel efficient when running at high compression ratios, lean fuel air mixtures, and high temperatures.

        This generates tons of NOx, the various nitrogen oxides that cause smog.

        Highly fuel efficient ICE cars are not new, Honda’s CVCC engines in the late 1970s and early 80s could easily get over 50 mpg, even with the older other engine/drive train technologies of the time (no 4 valve DOHC, electronic ignition and timing, fuel injection. iridium plugs, synthetic motor oil, eco efficient tires, etc, etc)

        Air pollution standards for NOx forced the ICEs to be DE-TUNED, to run at lower temperatures and compression ratios and richer fuel mixtures to reduce the NOx levels. Honda had to stop selling the high mpg CVCC engined cars

        Modern high fuel efficiency diesels have the exact same NOx problems. The diesel makers that didn’t cheat force users to fill up with a urea mix which is sprayed into the exhaust to reduce the NOx. They could just use fuel to reduce the NOx also, but that would drive those dazzling fuel MPG numbers down to ordinary levels.

        The modern hybrid ICE- electric cars like the Toyota Prius generally use some variation of an Atkinson cycle ICE to maximize fuel efficiency while keeping compression ratios and NOx levels low. Atkinson engines are a pretty dense topic but worth reading up on (Wikipedia has a good article). The tradeoff is that they are low power engines, but work well in combo with the high torque battery electric hybrid designs

        • Bart says:


          When I said de-tune, what I meant was lower horsepower, not a reference to compression, fuel / air mix.

          I am thinking 1984 Toyota 2.0L engine that got a Camry running 44 mpg. Tweak that thing with some of the trans advancements and it could run 50 mpg. Urea for diesel is a given, can run those at 70+ mpg. Look at the HP ratings for some cars – 125 + HP / liter. BMW M and AMG, seriously, who needs that kind of power and other than the track, no place to drive. Suburban / Yukon, Sequoia, Landcruiser et al – $15K infrastructure tax up front, buy or lease still $15k.

          For commuting or vaca, an extra 2.5 sec to 60 mpg is no big deal. Some horizontally opposed engines being played with offer even more mpg. The tech is available now.

          We could double fossil fuel mpg in 5 years. The cars would accelerate slower but so what.

    • Paul says:

      If my wife hadn’t had anything in the box for 6 months, I would get rid of her and start dating again.

    • Paul says:

      There is no sulphuric acid in a Lithium Ion battery.

    • char says:

      Lithium strip mine? Salt lakes are nasty but they are as Mother Nature made them

    • Old Engineer says:

      I think you are confusing lithium batteries with the conventional lead/acid car battery. I don’t know what is used in the manufacture of lithium batteries but they don’t have sulfuric acid in them. Your standard lead/acid automotive battery is full of a dilute solution of sulfuric acid. The design hasn’t changed much in 100 years. Also most car batteries today are re-cycled. I wonder if the lithium batteries can be.

    • nocte_volens says:

      Not that I am recommending lithium ion batteries…but they don’t contain acid.

    • PIGL says:

      I have seen a number of strip mines, including those for coal and heavy oil. I call bullshit on your claim that lithium minds are somehow uniquely destructive.

  12. safe as milk says:

    and who will be left to pay the pensions?

  13. Jack says:

    Still would NEVER think of buying anything GM. My dad always wanted a Cadillac. Bought a new Cadillac V8-6-4. Remember that one? Then traded for a Cadillac diesel because the dealer said it was a better car/engine. Remember that? So dad suffered for a period of years. Then a new car came out (1986?). It was called Acura. Bought a model called “Legend”.
    Had that car from 86-2002 when he passed away. 120,000 miles on it . He loved it, wanted to be buried in it but mom and 4 kids said no. We all still stay far away from GM.
    I am sure this “type” of story is repeated across the USA!

    • MC01 says:

      That Cadillac used the much dreaded Oldsmobile LF9 diesel engine, which reminds me of the Triumph three cylinder engine I had in two of my motorcycles because the designers had to put a lot of effort in designing such a large displacement engine so down on performances and so unreliable.

    • Gandalf says:

      Yes, I had an ‘88 Acura Legend, it also had over 120,000 miles on it, and I had just spent over a thousand dollars of refurbishment on it to get it to last for another ten years when my oldest daughter, then a teenager, did an accidental U-turn into a tree with it (the tree survived with not a dent in it, the Legend was totaled). The tight steering fooled her as she’d been driving the minivan which had quite different handling properties.

      A nice car, a bit underpowered for a V6. By then Honda was making even better cars, and the newer Accord V6 was a better car than the Legend

      I remember looking at the Cadillac cars at the time and was amazed at how low tech their engines were – pushrod double valve iron block monster V-8s

  14. Jack P Lifton says:

    I actually don’t think that GM knows much about making and selling EVs. They also don’t seem to know how much it costs a poorly managed company to develop new products. The glory days are long past. I note that the Cadillac CT6 was just introduced last year. Now it will go out of production next year as will the Cadillac ATS. Yet we have not heard of Cadillac BEVs, so is Mary going to eliminate Cadillac or just continue it as an ICE powered expensive SUV maker. Twas poor management killed the beast.

  15. John Beech says:

    Too bad GM, using data from building EV1 cars and leasing them 20 years ago doesn’t today offer a car/truck with standardized electrical connections. E.g. do what Bosch did with CAN-BUS, and put the battery compartment specs and electrical connections into the public domain.

    Sell cars and trucks with standardized batteries. at the same time, jump start the concept of buying batteries from another supplier (just like I buy gasoline from Chevron! instead of GM). Then someone good at batteries concentrates on that while GM concentrates on building cars!

    Does anyone doubt Elon Musk would miss an opportunity to produce batteries for GM and the whole automotive world if the battery compartment standardized spec is adopted by the car industry? Him, with a giant Panasonic battery factory out in the desert?

    Finally, with respect to Ms. Berra, I cannot forgive her decision to not build and offer the Elmiraj concept car. it borders on automotive management malpractice.

    • nick kelly says:

      Yes, it is a Panasonic factory with its 30 year old Li-ion tech which for some reason people think Elon invented shortly after inventing the electric motor.
      Elon has announced that anyone can use his patents. There are none of the drive train that are now available to anyone.

  16. AMIGAUSER says:

    Hope you don’t plan on having a Tesla car in a country that suffers from cold weather, very BAD things happen to lithium battery packs when they get cold or worse freeze

    • PIGL says:

      I wonder at the persistance and desperation Betrayed by these sorts of arguments. “One particular version of the technology will not work for my specific use case or geographic location; for example the trivial minority of rural dwellers in cold climates. Therefore no alternative to ICE technology is possible”.

      The argument, once clearly stated, is self refuting.

      • Wisdom Seeker says:

        Desperation? Desperation is when a clueless city dweller takes their EV on a rural winter vacation (ski trip) without knowing the limitations of the vehicle. Or when a knowledgeable driver simply forgets to plug in overnight. No fun to wake up and find the battery is too cold to drive. Even less fun to freeze to death while trying to reach a charging station, but you ran out of charge because the vehicle’s range is greatly reduced in sub-zero temperatures.

        Most people I know like to use their car for far more than just going back and forth to work and shopping. But they don’t want experiences like this one:

    • Frank says:

      Take a look at this report out of Norway on how EV vehicles handle extreme cold. The testers drove the vehicle over 700 km and temperatures as low as -20°C. In conclusion the reports shows that all these vehicles perform just fine and very low temperatures.

      • Jessy S says:

        They are also charged overnight. Still that is good mileage as 700km translates to 435 miles. But the article doesn’t talk about energy consumption while charging, especially the fast charging stations and how it affects Norway’s power grid.

        • Dave Chapman says:

          Norway has insanely low electricity prices, because they have lots of hydro. For them, EVs make very good sense.
          If you live in Connecticut, not so much.

          Norway is one of those places (like Iceland) where electricity is so cheap that not using electric cars would be a mistake. Your mileage may vary. . .

  17. iindie says:

    First things first . Since 2008’s GFC all that was done was basically maintain the status quo , All that happened is a HUGE asset reflation with cheap credit that went into buybacks in order to make up for lackluster results. Now that this Era of cheap credit is almost over the whole reflation is becoming unhinged and for good reason.

    The economy in 2008 was a patient sick with vibrio , destroying every cell and tissue of the body . What the central banks did was add more blood to the patient in such large quantity that the patient would not decompose outright. Somehow the patient survived a bit like a zombie survives.

    Keep with me on the analogy here:

    1) Zombies live to EAT . A zombie will absorb a healthy being and create another zombie in the process.

    2) If not fed a zombie will go on a rampage and explodes , spreading the disease geometrically instead of arithmetically .

    3) If given a non human source of food , the zombie slows its consumption of human flesh but keeps on making other zombies , just at a slower rate , the contagion is less visible but the spread continues.

    4) We don’t have a cure for Zombie disease , just containment at best and that is only temporary.

    5) Zombies can only be killed by a headshot.

    The Federal Reserve by injecting liquidity just slowed the spread of the disease but did not cure it , it just made it dormant for a while in its outward effect but allowing it to spread wider and wider. Less zombies died but their numbers kept on creeping up .

    The Federal Reserve kept rates low for 10 years keeping the zombies alive just to keep some form of social cohesion / peace. The issue is the number of zombies does keep increasing and there is less and less alternate source of food to keep the zombies subservient.

    The zombies being not the smartest beast found interest in eating other zombies coated with food and consumed other zombies (Share Buybacks , Acquisitions , Leveraged loans). Result = BIGGER ZOMBIES!

    Now the Federal Reserve seeing that trend develop , tries to refrain that part leading only to a bigger problem , but now the bloated zombies if they explode will make a MUCH bigger mess that might not even leave the Fed standing upright.

    What QE has led to is basically endemic and systemic mal investment , and now the zombies are playing a game of chicken with the Central Banks daring them to continue QE ad infinitum or face big explosions and fireball of a contagion.

    This money could have been invested in R and D for new technologies but , quantum leaping is HARD and zombies are definitely not into smart things , at best they can imitate and that takes a massive amount of effort for very little return on the money invested.

    The auto industry is by far the typical zombie, in the sense that it kills in the bud any kind of evolution unless under extreme constraint and then again will find ways to evade the blow as long as possible.

    Electric cars unfortunately arrived to market at a point the Zombification process was getting in its advanced stages.

    As a Tesla owner (Roadster 2.0 and 2.5) , I never believed in their sedans which are made for U.S sized roads and have NO agility whatsoever when it comes to turning radius! Try to back park a tesla roadster without any form of power steering and you will get the idea quickly or make a 180 degree turn that does not involve a 5 point manoeuvre that will make piloting a sub like child’s play.

    The approach of the auto industry to electric cars in Europe was to let you buy a car and then LEASE the battery to the “owner” … a scheme that was doomed to fail in a HUGE way , since it would kill any economy of usage on the consumer side. It took 8 years for the auto industry zombies to understand that they were definitely not going to catch any attention with that trick , at least not until they generalised leasing to the whole market which is exactly where we are now , only with combustion engines (the irony!).

    Now that rates are going back up the zombies are running out of food… what all the Fed did buy was time and at great cost to the middle class , which is oh … the main driver of the democratisation of R and D !

    GM killed with a vengeance its electric cars. And so far no electric car manufacturer came close to where Tesla went with the roadster . What followed in terms of Tesla models lacks in terms of innovation , the issues that the roadster was born with kept creeping up into the later models (Poor braking power to weight ratio , Wide Wheelbase for EU roads, Nightmarish turning circle).

    Moving the battery pack into the floor is not a rich idea when most collisions happen at the lower edge of the center of gravity of the car. And most the sedans are HEAVY , the breaking distance might be fine for US users but cars in our day and age need breaking power equivalent to their forward power. If you want an example the SLC is a good example of high agility in a compact format with a devil of an engine.

    In reply to fajensen’s comment , come on car manufacturer don’t know at this point how to coordinate 4 electrical wheels, The Mercedes SLS Electric Blue was the only car in that regard that could have tackled in the real world , only that it would have taken to use fiberoptic fly-by-wire and high performance internal computers not to mention sensors to achieve reliable results. Both efforts were nipped in the bud in favour of Internal Combustion Engine versions .

    High performance battery packs need to be cooled either by air circulation or liquid circulation making the whole battery system pretty much proprietary as a safety measure. You don’t want to face a LiCo or LiPo thermal run off when you are dealing with high rates of discharge!

    One thing that i learned quickly as an Ev driver (80kMi on the 2.0 60kMi on the 2.5) is that cells don’t really die easily and most of the deep discharges i had to go through were for service purpose only.

    Battery packs due to their cooling requirements are MO-DU-LAR which means the battery pack never gets fully changed in a go unless you are upgrading the whole thing !

    Oh cost of a battery upgrade for a Tesla … 10K USD nowadays.

    You can bash Tesla and Musk all you want but the work that has been done on the roadster by Martin Eberhard was nothing but stellar in terms of innovation and yes Musk is a great salesman in that regard , he took the idea and ran away with it , to great results for the US EV market.

    Yes, I bought into the IPO and sold when i thought there was just too much crazy happening at Tesla concerning the Model 3 , it has been a good and wild ride .

    Probably i will be looking forward to a Roadster 3.0 at some point … i love the wickedness of the Warp speed hoping that agility will get the upgrade it needs and that the braking power curve gets an upgrade.

    But let’s face it the auto industry at this point could use an upgrade to its engineering , if Tesla is a hard target to catch back for them it is just because the zombies got lazy and bloated by groupthink !

    I felt dead inside when i drove the BMW i3 , i was wondering all the time where is the punch of the engine , i am doing something wrong ? Output was weak handed and regeneration was lacking , braking action was a JOKE of galactic proportion for a car this weight !

    “People who are really serious about software should make their own hardware” … Alan Kay .. Applied to EVs Tesla aside we are getting vehicles and systems built out of generic off the shelf median quality parts … you cannot quantum leap into a market with that thinking , plain and simple.

    The punchline is i don’t think GM has the humph nor the will to make any serious effort into the EV market they had their chance though.

    The next leap in innovation for EVs would be to have 1 engine per wheel , fly by wire and synch and engines that have combine punch AND flexibility while keeping the energy enveloppe coherent … that would take majors like GM decades to even contemplate to achieve in any shape or form.

    That is putting aside the Huuuuge inventory of Internal Combustion Engine Vehicles that will get returned from leases and that will not find customers as EV becomes a desirable alternative. The Zombies of the auto industry realise this somewhat that the channel stuffing that happened all this time on cheap credit will bite back !

    My take on the whole shebang would be to let the zombies explode , their capacity for adaptation to market is nil any way you want to look at it. There will be fallout for certain and we might face another GFC but at least this time around we will have learned in less than a generation’s time that kicking the can down the road is not a viable solution to tomorrow’s problems.

    • Harrold says:

      I’m pretty sure that the BMW i3 was designed to make sure it did not draw buyers away from traditional BMW vehicles.

      As Wolf opined above, the move to EV will cause the closure of all engine/transmission plants.

      • California Bob says:

        Everyone seems to just presume the global petroleum industry–Exxon, Royal Dutch Shell, BP, Chevron–are just going to roll over and let electrification eat their respective lunches. Don’t bet on it.

      • MC01 says:

        The i3 was designed for fleet average emission/consumption purposes, nothing more, nothing less.
        The ordinary version costs as much as a very nice 3 series and the one with a backup piston engine (a 500cc twin manufactured by Kymco of Taiwan and based on one of their scooter engines) as much as a 5 series. Nobody would spend that much money for such a small car: sales of the BMW Mini (which I foolishly authorized as company cars a few years back, now they are all gone and replaced by Toyota hybrids; mental note: never ever leave your employees in charge of procurement processes again), 1 and 2 series have completely frozen the moment EAPR hit 4%.

  18. Patrick Depailler says:

    Full torque @ 0 rpm. Charge at night, drive during the day. No oil changes. No brake wear. No clutches, no torque converters. No exhaust system. No evap system. No belts. No manifolds. No carbon build-up. No injectors. No transfer case. No central drive shaft. Just make sure you lease them and trade in after a few years, just like you do with your cell and laptop.

  19. akiddy111 says:

    Barra has been under pressure from Einhorn for quite a while to cut costs to the bone. FWIW, Einhorn is another Hedge Fund billionaire in the mold of Lampert.

    GM is super important to Einhorn right now. He does not want his legacy to end up like Lampert’s.


      Einhorn knows GE is going down. How could he not know if everyone else knows?

      Even the bookies know too, eh. Heck, GE has been shorted for many moons now. The writing is on the wall the same way it was for SEARS Inc.


  20. kk says:

    Surely something must be going right in our technological new world?

  21. akiddy111 says:

    Trump and Kudlow need to summon Einhorn, (not Barra) to the Oval office.

    Einhorn has blamed Barra for his value trap investment. Hedge Fund billionaires can be persuasive.

    • Yogi says:

      Maybe they should listen to Yogi Berra?

      “A nickel ain’t worth a dime anymore.”

      “You wouldn’t have won if we’d beaten you.”

      “The future ain’t what it used to be.”

      “You’ve got to be very careful if you don’t know where you are going, because you might not get there.”

      — just a bit of humor from USAtodays list of 50 great Yogi Berra quotes.

  22. 2banana says:

    But…but…the obama sham bailout was supposed to fix GM/GMAC.

    And the American taxpayers lost over $10 billion in that sham bailout when the last share of government owned GM stock was finally sold in 2014.

    $10 billion loss for about eight extra years to keep the sham going and keep the UAW and its insane pensions whole.

    And the destruction of 100 years of contract law.

    And here we are again…

    Except the person in the White House is not looking to buy votes in a bailout this time.

    • Real Don Father says:

      At 42% approval and with now less than 2 years till election day, expect the person in the White House to be buying any vote available, because he’s sure gonna need them.

      Or, maybe he’ll just decide to keep on doing what he’s doing and stay at 42% (or fall further) and go down in one of the historic landslides in history.

      My guess is that he’ll say “lets make a deal”

    • Javert Chip says:

      US taxpayers lost more than $10B in the Obama/GM fix.

      Bankruptcy eliminates tax-loss carry-forwards…except for GM’s bankruptcy. I believe there were about $40 of carry-forwards, which, at 39%, pencil out to an ADDITIONAL $15-16B tax-payer loss.

    • nick kelly says:

      News flash! The GM bailout was signed by George Bush before Obama took office. His explanation: ‘I didn’t want him to be confronting a crisis on his first day’.
      Before this GB had authorized the first bailouts of the financial sector, explaining to the hastily convened meeting: ‘This sucker could go down’

      • 2banana says:

        News Flash.

        On June 1, 2009, GM entered bankruptcy.

        The U.S. government’s $80.7 billion bailout of the auto industry lasted from December 2008 to December 2014. The U.S. Department of the Treasury used funds from the Troubled Asset Relief Program. In the end, taxpayers lost $10.2 billion.

        I will let you do the math on who was in office and who was president elect.

        But hey, it made the UAW whole for eight more years and brought in tens of millions in campaign donations to only one political party.

        All is good.

        • nick kelly says:

          ‘The U.S. government’s $80.7 billion bailout of the auto industry lasted from December 2008’

          Obama did not take over until January 2009. The decision to bailout GM had already been taken. Since reference is made to the entire time of the process, the only conceivable implication is that Obama should have reversed the policy, which is inconceivable.

    • Mike G says:

      He just jacked manufacturing costs across the US to buy a handful of steelworker votes. Trump is an opportunist, and demonstrably not a free trader. You think he won’t empty the treasury to bail GM if it comes to that?

      • Jessy S says:

        Actually I think the SEC and Justice Department will go after the auto industry for closing plants.

  23. Peterson says:

    I thought the reason for all these cash buy-backs was because in the 1990’s the Clinton administration out-lawed the deduction of cash compensation for executives above 1 million dollars.

    Hence the move to paying with options that motivated CEOs to ‘do anything but anything’ to get the share price up.

    Seems like the fix would be to do away with performance based compensation. So pay the CEO 20 million, maybe even 50 million and invest the remaining 13 billion that was wasted on buy-backs on some new battery technology.

    I think we can otherwise expect most CEOs to systematically destroy their companies for short term gain.

  24. MF says:

    Who thinks GM will get Sears’d?

    • Atu says:

      We must have caught the same wave, my comment below went in before reading yours. Ha ha.

  25. Atu says:

    Sounds more like Sears or GE or, or….

    …et voilà , even the yellow vests want to keep their ICE.

    Walking and cycling are good, except for the traffic. Decent public transport, as in 1st class ? Redesign the cities! Drone delivery for all, or just smaller more efficient engines?

    The point being people will want their autos, of one kind or another, for one use or another, but there is a good mile between the current fleet and total EV, one that won’t be covered by – total EV.

    Choices choices, or dictates laws and subsidy should that be ?

  26. Marcus says:

    Naive (and sincere) question:
    What’s stopping one of the big manufacturers from trying to acquire Tesla? Imagine a fleet of electric half-ton pickups.

    • Wolf Richter says:

      Price. You don’t buy a troubled automaker that makes only 120,000 vehicles a year if that many, for upward of $60 billion. GM makes around 8 million vehicles a year, and you can buy it today for $53 billion.

      • WES says:

        Wolf: I suspect Tesla runs more on taxpayer subsidies than on anything else!

      • MCH says:

        Wolf, they would not be buying Tesla, they would be buying the visionary, Musk. Hahahahaha.

        But seriously, whether you think he is a fraud or not, you can’t deny that he has had a serious impact on two industries. It might be arguable, but without him, we wouldn’t be talking about Tesla or SpaceX, both would have just faded away.

        Look at what he has done for rocketry, would anybody have believed it was possible 15 years ago for a shitty little upstart led by someone who had no aerospace experience to break the hold of ULA on the rocket business i the US?

    • 2banana says:

      $10+ billion in debt?

      Better to wait for Tesla to go bankrupt and buy it for pennies on the dollar

      • Marcus says:

        Okay, but will everyone wait? If Tesla stock starts to really plummet and the overall valuation drops, is there a point where manufacturers start circling like vultures? Or is it necessary that they wait until the debt is offloaded in bankruptcy? In other words, is there any way to offload debt during the acquisition? If not, is there a point where the acquisition costs drops enough that Tesla’s debt is palatable as the cost for their excellent technology and charging infrastructure?

        /When I said naive, I meant really naive
        //Here to learn

      • nick kelly says:

        Buy what? The name after it goes TU? The Li-ion Panasonic battery, the electric motor?
        The reason there are 100 + entrants in this race incl. MB, BMW, JAG, Nissan etc. etc. is that there are no barriers to entry.

        The latter may not build a better drive train but they’ll build a better body and they will mass produce them.

    • MC01 says:

      Both Daimler and Toyota already own a share in Tesla. It was a good equity investment, but neither company needs the technology, let alone the manufacturing capability.

      Daimler has had hybrid city buses available for a while now: while technically they make a lot of sense, they are also rabidly expensive, so much they struggle to sell in meaningful numbers.
      Toyota has been selling hybrid lorries based on their highly successful Hino Ranger for years now.
      These vehicles are as refined and reliable as you’d expect from these two manufacturers but they are not making an impact. Part of the reason is the high price, considerably higher than a standard engine, and part of the reason is the ongoing diffidence against hybrids and electric vehicles in general.

      It took Toyota over 15 years to start selling meaningful numbers of hybrid cars in Europe and they are still considered somewhat of an oddity, so you can understand why hybrid industrial vehicles struggle so much.

  27. Agnes says:

    I’ve seen no mention in the comments of the inventor of the lithium battery, John B. Goodenough [not Johnny B Good, but goodenough to remember the name] and the Glass Battery, which is still controversial, but, I believe, doable. Check out:

    or google/wikipedia his name or glass battery.

    What we have now is not the endpoint in electric vehicles.

    Caution: a lot of knowledge of microelectronics is needed to understand how this concept actually works. But it doesn’t hurt anyone to read about it.

  28. WES says:

    I think most people are missing the point that consumers have been buying non politically correct vechicles (SUV & trucks) because they do not like the politically correct cars that we’re designed by Congress!

    Average income people simply cannot afford to buy pure EVs because they are simply too expensive. They also cannot afford to own both a EV and an ICE as most commentators here do.

    Poor people also cannot afford the risks of buying a pure EV on credit because of the huge battery failure risk. Who can suddenly come up with another loan for $12K to $18k to fund a new replacement battery? Without a new battery their pure EV has little value! There are plenty of used pure EVs to be had cheap that just need a new battery! I wonder why!

    I am always amazed at the stupidity of supposedly smart people when it comes to understanding energy. Any time one decides to convert energy from one form to another form big losses are incurred. Producing electricity to deliver to a home to charge a pure EV is a very inefficient use of that energy. But I have given up trying to use basic science to educate these people because like liberals they only see what they want to see.

    In cold climates owning a pure EV is like owning a motorcycle. It is purely a seasonal vechicle useable only in warm weather.

    Auto consumers may be stupid but they aren’t dumb! They will continue to favor politically incorrect ICE powered vehicles over politically correct vechicles for some time to come!

  29. Quicksilver says:

    Given current production Li-ion EV looks unsafe in freezing conditions and has range/charging issues, and direct drive ICE has significant mechanical costs, it would seem to make a lot more sense to have EV with freezing-safe battery tech., backed up by small natural gas combustion generator or fuel cells. Gas maybe a far better choice than liquid fuel, because it can’t freeze or carry water or gunk to stall/damage the generator.

    This looks promising to make Li-ion safer and higher capacity:
    , maybe this could be adapted for the Na-ion batteries proposed here:
    This looks interesting to eliminate the liquid and dramatically speed charging too:

  30. Jeremy says:

    Toronto area news was reporting this morning that the estimate is around 30,000 jobs will be lost in Ontario over the next two years, factoring in the full supply chain of that Oshawa plant closing. There’s not much other than auto mfg in Oshawa; not sure what they’re going to do now.

  31. California Bob says:

    Ah, the relentless, insipid ‘Real People, Not Actors’ commercials finally took their toll.

  32. Tom says:

    This is an opportunity for Elon to tap more free Gov. funds to acquire these Gm plants to move out of his tent.

  33. makruger says:

    EV’s sound like a nice idea, but in the cooler latitudes, a lot of that stored energy would be expended just keeping the batteries and the occupants in their preferred comfort zone. Naturally range would be reduced.

    From what I have heard, you’d need a 220 volt charging station in each driveway just to keep the batteries themselves warm enough during winter (apparently 110 Volts isn’t enough).

    • fajensen says:

      What you actually need is 400 V, 3 phases (or one of these 500 V DC charging converters).

      To not have to wait 20 hours for that poky 230 V 16 A Schuko socket to deliver some charge. Never mind not burning the wiring, which is rated at full load for 2 hours, according to current standards. The EV’s come with a special Schuko-adapter that measures the voltage drop from the heating and lowers the charging current.

      The 400 V EV charging box will costs a few hundred EUR installed. This is considered “nothing”.

      *) The 400 V, 3-phase, TN-S, fused for 32 or 64 A, is the normal power supply to a house here almost since Edison. Some place in the forest they still have single phase electrical supplies, 6 kV distribution with a “pole-pig” between two phases.

  34. michael says:

    If EV’s were so lucrative a product there would be no government subsidies.

  35. Escierto says:

    A couple of my kids have Teslas and from reading the above comments there is a huge amount of misinformation about them, their batteries and the process of charging them. Once you’ve driven one, the old combustion engine cars seem like a relic for Gramps to use.

    • California Bob says:

      Where do your kids live?

    • 2banana says:

      The Tesla is an awesome commuter car in the warm and SW.

      In the cold NE for any kind of driving more the 50 miles in winter…not so much.

  36. fjcruiserdxb says:

    One of the big issue with EVs is the disposal of used batteries. Where are they all going to go. Landfills ?

    • MC01 says:

      No, Asia.

      China and Japan have been quietly growing their Li-Ion recycling capacity over the past decade and between them they account for a massive 76% of worldwide recycling capacity, with China leading the charge with a monster 66%.
      As Asia manufactures most of the Li-Ion batteries used worldwide (just to give an example the top ten manufacturers of EV/hybrid batteries are Asian, with Panasonic controlling an astonishing 45% of the worldwide market), and even Japanese and Korean manufacturers tend to concentrate their manufacturing capacity in China, it makes a lot of economic sense.

      The average lifespan of a battery in a first and second generation Toyota hybrid is stated to be 150,000 miles or 240,000km. Toyota will replace batteries even on first generation Prius for a lump sum (last time I checked was around €5,500 including VAT and labor) and take care of disposal themselves, meaning it will be shipped back to Asia and recycled. I can only hope other car manufactures will follow in their lead, as will breakers.

      The big challenge are batteries under 9V, which in most countries are dumped together with ordinary alkaline and smaller sealed lead-acid batteries and disposed of instead of being recycled.
      But like the Chinese are wont to say “we need to leave something to do for future generations as well”.

    • Wolf Richter says:

      They’re being re-used (by grid operators et al.) and they’re being recycled. One thing they don’t do is go to landfills.

  37. Realist says:

    For EVs to replace current veichles there must be a technological breakthrough in batteries because where do you get all the be needed lithium ?

    Btw, where I live, smart people use electric preheaters to warm up your ICE when it is cold, sometimes closer to -40 centidegrees. Yes, a car in working condition will start without preheating but it sounds horrific then and the wear before oil is warm enough to lubricate properly is equal to a lot of mileage.

    My neighbour bought an EV. It will be interesting to learn their experience if there is a proper winter this year.

    • Jackk says:

      Realist, I lived in a winter climate for a few years where it got down to -40 (C or F). The block heater in the engine for those that don’t know keeps the antifreeze warm and makes for a little easier start, but more importantly, you get heat out of you heater core much sooner. Minus 30 or 40 is way too cold to be sitting there waiting for the thing to heat up.

      And if I had a weakened battery, I bought an electric battery blanket (wraps around the battery nicely) and plugged that in, too, for better cranking power. Nowadays with fuel injected engines (i.e., no carburetors) and synthetic oils, the battery blankets aren’t needed.

    • nicko2 says:

      Australia, Chile, central Africa…. And eventually, extracted from sea water.

      • a citizen says:

        Have you worn any holes in your pants from worshiping at the lithium idol?

        I think everyone can agree EV tech is going to be a serious value add in the niches it can fill. But it can’t fill all of them, not even close, and anyone making investment decisions based on such an assumption is a fool.

        Further, moving to lithium tech moves us from a ubiquitous energy resource of to a non-ubiquitous resource that is dirtier to obtain and far dirtier to dispose of. Other emerging energy technologies are far cleaner and merge into existing infrastructure quite readily.

        Your lithium fanboy-isms are tiresome need a serious rethink.

  38. Laughing Eagle says:

    The EV maybe the future but I think someone needs to add solar panels to the roof to cut down on electric charging.
    GM has had bad management for decades but thus move is about abanding the American market. With 1.3 billion people in both China and India, GM knows where they must go. Anerica only 300 million. But I think they will struggle against the Korean and Japanese car manufacturers.
    I owned a 68 Firebird, 76 Firebird, 78 Olds Cutlass, and a 83 Olds Cutlass but no more GM. Tired of cars with cheap parts that do not last. That is the difference I see with the Japanese and Korean cars, they can spend more for better quality parts because they do not have the overhead of the expensive American healthcare costs and retirement costs.
    And self driving cars, well that is at least 10 years plus away. I cannot imagine self driving cars in LA. That would be entertainment just to watch.

  39. Unamused says:

    Can you see the pattern yet?

    – GM is going the way of GE, and Sears, and JC Penney, and Toys R Us, and many others: instead of investing America’s most iconic companies, they are all being cashed out.
    – Record stock buybacks;
    – Record household, business, and government debt;
    – Crumbling infrastructure;
    – Trillions wasted on tax cuts for the rich, military adventurism, and other corporate welfare;
    – Replacement of middle-class jobs with minimum-wage gig jobs;
    – Exhorbitantly destructive housing and medical costs.

    All are part of this same pattern. The US economy in general, and the US middle class in particular, have been made unsustainable, deliberately, and are instead being liquidated under the pretense of a phony, debt-fueled economic ‘recovery’. Because that’s what Wall St. wants: to feed its greed by swindling away the accumulated wealth of the country, and it is succeeding.

    Greece was just for practice. Greece was just an appetizer. On the US it can gorge.

  40. Wolf Richter says:

    My share-buyback angle of GM’s plan is getting some additional traction on MarketWatch, which cited that part and my chart in its front-page article…

    • Unamused says:

      Share buybacks represent disinvestment, particularly when bought with debt that is so unproductive as to be destructive. It’s a way to liquidate the company under the pretense of ‘maximizing shareholder value’. This practice and others reward mismanagement and failure because that’s how the incentives are structured. Companies that aim for failure seem to have a way of achieving it, and the list is growing.

    • You buyback a share and it loses 10% of its value you still have 90% of your asset. (esp if you bought them last year at 80% of their peak value) Can they convert those shares (which equate into market cap) into new colalteral, and the answer is yes. This ain’t Tesla. No idea what their defense contracts look like, but if USG goes on a buying spree (remember the Fed by charter can also buy automobiles, or anything else) All these things are desperate measures (its interesting that the political blowback is on 44, last nights news put it on 45, a laid off worker of 28 years against some bloviated claims made by potus. If this had happened two weeks ago the Senate would be Democratic hands).

      • Jessy S says:

        Don’t listen to them. There is a reason why I call the news networks by these names.

        Fox News is Faux News
        CNN is Cartoon News Network
        NBC is Nothing but Crap
        ABC is Anything Beats Crap
        CBS is the “Important News Network” but only because of how smug and important Jeff Glor feels when presenting the news.

  41. Copernicus says:

    @laughing eagle. Reagan maybwell have legalised buybacks. But embezzlement is still illegal. How can borrowing money in the name of the company to prop up the share price to enable excersing your stock options not be embezzlement? You would think it is an open and shut case. Quite aside from when this is done while pensions are underfunded.

    • Unamused says:

      ->Quite aside from when this is done while pensions are underfunded.

      Corporate debt and share buybacks represent parts of an excellent strategy for repudiating pension obligations, effectively confiscating pensions: just rack up enough debt to require bankruptcy restructuring and those pesky pension costs simply disappear, along with as many other financial and legal obligations as possible.

      -> How can borrowing money in the name of the company to prop up the share price to enable excersing your stock options not be embezzlement?

      Financial fraud has been increasingly legalised at least since Nixon – stock buyback fraud in 1982, mortgage fraud in 2008, a whole series of them. Worse, federal prosecution of business fraud in general, and financial fraud in particular, has been winding down to nearly nothing for the last couple of years, for profitable purposes and to curry political favour. Moreover, among the 1% or so, tax evasion has become the national sport over the last few decades. Naturally tax cuts for the rich never pay for themselves and never expire as promised, which is why the national debt has been ballooning since 2001.

      And so forth. It gets worse the more you look at it.

      • WT Frogg says:

        @ Unamused : You mean to say the “Trickle Down Economics ” doesn’t work ???? I’m SHOCKED I tell you JUST SHOCKED !!!! sarc/on

        I wondered what that puddle I was standing in was (bovine excrement maybe ??)
        Too bad the ancient art of tar and feathers went out of fashion.

    • Rowen says:

      There’s a whole cadre of B-school professors who’ve developed various rationale for SBB. Most are just various versions of arbitrage. For example, if interest rates are 3% but you think the company can grow by 10% over the same period, then it makes sense to buy the stock, retire the stock, and keep the gains with the company versus distributing to shareholders.

      Pretty much all BS though. It’s really just a cash-out refinance with the proceeds going to insiders and institutional investors, with retail/retirement investors left with the carcass.

  42. Tomonthebeach says:

    Odd that nobody has suggested that the GM shift likely signals the end of Big Oil. It was Ford and GM who bribed cities to rip up their electric streetcar tracks in favor of Arabian and Oklahoma crude-running fume-belching buses. Once Standard Oil and BP cut a deal with the Saudis, electric vehicles died. Now the reverse is beginning to happen.

    Gas prices are plummeting with no end in sight. Cheap gas is “fueling” an orgy of F150s and gas-guzzling SUVs all racing toward the same precipice – electric motor-driven vehicles. Likely, a hundred million or so people will still be paying down 7-year+ liens on their big gas-guzzlers when petroleum skyrockets due to dwindling supplies and added taxes due to pollution. Electric cars will bleed capital investment in pumping crude to make petroleum. Instead, capital will be chasing battery manufacturers and robot assembly lines.

    Either GM (and its fellow Detroiters) get smart, or TESLA and Mercedes will crush them. Odds are that being crushed will not happen. Detroit has smart engineers who can ramp up supply quickly through better assembly designs than Tesla has demonstrated so far. But those Tesla back orders have Detroit drooling over the potential of electrics.

    Sadly, this inevitable transition will make more humans obsolete will stemming climate change. Opioid suicides of despair will continue because while shuttered, an army of robots will be descending on those GM plants to make e-Cars in another year or so. Meanwhile, state and federal governments will dither when they should be investing in job retraining (as if DeVoss and Trump giveadamn).

  43. p says:

    here in norway the change is there.
    45% of new carssales is fully electric cars.
    gasolineprice up up at over 2 dollars a litre.
    driving a electic is cheapest

  44. Chee Hong Tan says:

    Remember the LTCM story? They paid back all the shareholders their money and let the banks take the fall.

  45. Mean Chicken says:

    I haven’t witnessed any hint of honesty from DC in decades, lead by example..

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