Congratulations taxpayers, you just purchased a 60% stake in the company that insisted on marketing Hummers when gas was $4/gallon. After receiving almost $50,000,000,000 from the govt, General Motors CEO Fritz Henderson said, “We understand there are no second chances. We won’t need one.”
So why are President Obama and the United Auto Workers union so confident GM will succeed? The UAW and govt will not be able to sell their shares of GM for roughly 2 years when they expect to have shares publically traded again. During that time, dozens of facilities employing roughly 20,000 employees will be shut down and benefits for retirees and their families will be reduced. Why wasn’t this done earlier when the company was bleeding money with no plan to correct its course? Perhaps when it is all said and done, GM will be a profitable company shed of its legacy burdens and poor performing brands. But could we have arrived at this point without risking so much of the taxpayers money? If this plan does not succeed, will there be another chance?
