General Motors is in strife. Media outlets in the USA are reporting that the automotive behemoth's share price hasn't been so low since the 1950s. Cash reserves are reportedly inadequate to fund the operations beyond a point less than four months in the future.
A forthright article in the Wall Street Journal takes equal issue with General Motors -- and fellow 'victims' of circumstance, Ford and Chrysler -- along with successive governments and the UAW (United Auto Workers) for the current concerns afflicting the industry in America.
If there's one ray of light for GM, it's in the assessment by analysts at JP Morgan that GM can draw upon untold reserves that would keep the corporation afloat through to 2010. Add to that the possibility that the US government might stump up the funds to bail out GM (and other car manufacturers) and the situation is looking less grim -- although still far from ideal.
In Australia, the mothership's imminent scuttling has led some to speculate whether the Holden lifeboat will be jettisoned to find its own way through the stormy seas, perhaps transferring its precious cargo to another vessel.
Jonathon Rose, Corporate Communications Manager at Holden is reluctant to discuss the state of play for GM in North America and how the corporation's financial hurdles would impact on Holden.
"What we can say is that yes, it's a challenging business environment, but Holden is responding to market conditions..." he told the Carsales Network. In effect, Holden is surviving in its own right on both domestic sales and exports, in spite of the downturn in the local and international markets.
As for the big picture, he is only too happy to make the point that Holden does not support any suggestion that the Australian arm of GM could be divested as a means of keeping GM in operation into the future.
"That's pure speculation and was an opinion floated, but is not fact," he said. "From Holden's [perspective], the suggestion is absurd."
Archrival Ford, despite shedding jobs by the hundreds in Australia, is in a relatively secure position for the moment, according to the local division's President, Marin Burela.
"Based on where we sit," he said, "things are very, very challenging, but we're holding our own."
Burela, speaking during the monthly briefing yesterday, paid tribute to Ford's global President, Alan Mulally, for the company's financial stability in the global context -- and especially in North America.
"Alan Mulally, when he came to the Ford Motor Company saw the cloud on the horizon -- and one of the very first things he did: he went out to the markets and he secured a level of funding that, when one looks back now, would say 'that was a stroke of genius'.
"The divestiture that took place under his leadership was, once again, a stroke of genius. I think we're probably better positioned, in terms of where we are, versus any of our competitors. Alan has come out publicly and said that as well."
Among those assets divested were Jaguar and Land Rover, now owned by Indian firm Tata.
Given the depressed state of the global market, it's unlikely either company would offload any further assets in the immediate short term -- unless there were absolutely no other choice.
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