Sobering Numbers

 Read an article that sums up GM's problems quite nicely. This part puts it all in a nutshell...

 GM execs doled out $7 billion for capital spending and research and development last year, vs. $15.3 billion for Toyota. The portion of that spent in North America gets spread over GM's 89 auto models and eight divisions, compared with Toyota's 26 nameplates in three divisions. Toyota models average sales of 80,000 units a year in the U.S., whereas GM squeezes out just 52,000 sales per model on average. And Toyota models stay on the market for an average of three years before their next redesign, compared with nearly four for GM's cars.

 The basic point is that GM is just too big, and needs to shrink. I've seen reports that killing off Oldsmobile has not helped GM, but looking at the numbers it now seems that the death of Oldsmobile was just a drop in the bucket, and keeping the division around would have only diluted the R&D dollars even thinner. To truly reach parity it looks like GM would have to kill off several divisions, not just one or two.

 Every month the news about GM seems to grimmer and grimmer. It's looking more likely that the automotive industry in America is going to be changing, massively, and that's without considering the impact of a Chinese invasion of cheap cars.


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