Anyone see a link between GM and Kodak

[SwedishAdvocate]

GM (and Ford and Chrysler) did go after the "low hanging fruit" of large SUV's which probably was short-sighted. Certainly other foreign automakers did so as well, but they also had their smaller fuel efficient lines which are important in their home (Europe and Japan) markets. I remember this same discussion back in the early '70s during the first "oil crisis" when the Japanese were able to swoop in with their little fuel efficient cars, and everyone was saying why didn't Detroit see this coming.

Given that (basically) the exact same thing happened in the ‘70s, all of this really is incredibly mind-blowing… To me it really says quite a lot about the competence and motives of the corporate leadership of the “big three” leading up to their 2008 failure.

 

[mknox]

Given that (basically) the exact same thing happened in the ‘70s, all of this really is incredibly mind-blowing… To me it really says quite a lot about the competence and motives of the corporate leadership of the “big three” leading up to their 2008 failure.

It's absolutely a shame and really isn't limited to the automotive sector. It seems investors reward companies that maximize profits for today and don't care about the the future. We seem to have lost our ability to strategize long-term and look beyond the next couple of quarters.

 

[keys]

I think that the lifetime period of products of GM vs. Kodak could make the difference between a repetition of history and well, a big win for everyone. Transition to electric transport arguably goes slower than transition to digital photography.

 

[dsm363]

I don't pretend to know for sure, but weren't the "bailouts" in the form of loans and the purchase of stock? I believe GM has paid back the loans (with interest) and their stock value must be better than it was in '09, so did it really cost "billions"? (Seriously, I'm just asking). There is a valid debate as to whether governments should be doing this in the first place, but I just wonder if it really did cost the taxpayer in the end. It certainly would have if the automakers failed.

GM (and Ford and Chrysler) did go after the "low hanging fruit" of large SUV's which probably was short-sighted. Certainly other foreign automakers did so as well, but they also had their smaller fuel efficient lines which are important in their home (Europe and Japan) markets. I remember this same discussion back in the early '70s during the first "oil crisis" when the Japanese were able to swoop in with their little fuel efficient cars, and everyone was saying why didn't Detroit see this coming.

Found this
It's Official: Taxpayers Will Lose Big on the GM Bailout - Rick Newman (usnews.com)
When all the shares are sold will still likely be in the billions of dollar range. Right now it looks like around $12 billion.

GM certainly wasn't alone on their short term thinking it just looks like they weren't financially sound enough or were able to turn their products around fast enough to not require $50 billion in cash.

 

[Citizen-T]

It's absolutely a shame and really isn't limited to the automotive sector. It seems investors reward companies that maximize profits for today and don't care about the the future. We seem to have lost our ability to strategize long-term and look beyond the next couple of quarters.

You have to lay the blame at the feet of the shareholders, ultimately they own the company. Executives do not act in the best interest of the shareholders, they act in the best interest of themselves (i.e. do what they need to do to keep their jobs). Ultimately, the shareholders decide the fate of a company. A company like Google or Tesla or Limited Brands where the shares are largely controlled by the founders has the luxury having shareholder interest aligned with executive interests. A company like GM does not.

 

[Liz G]

It's absolutely a shame and really isn't limited to the automotive sector. It seems investors reward companies that maximize profits for today and don't care about the the future. We seem to have lost our ability to strategize long-term and look beyond the next couple of quarters.

I would have to agree and say it extends to our government as well.

Rephrase.. our politicians.