#Chevy writedown sale free

And giving up on Opel (whose models are rebadged as Vauxhalls for the British market) is a big step in the direction of not having competitive passenger cars. The last time gas prices soared, G.M.’s lack of competitive passenger cars helped, along with a failing economy, push it into bankruptcy. Now it wants to sell more gas-guzzling Chevy Suburbans, which are so much cheaper to make and more profitable to sell than ordinary-size Chevy Cruzes and Buick Regals that, well, they just can’t help themselves. Back then, it just couldn’t wait to get the Chevy Volt into production, and it promised it was going to be a responsible partner in cleaning up the environment it helped pollute. has seemingly forgotten all the earnest statements it made back in 2009 when it was seeking a federal bailout. With the Trump administration’s avowed intention of rolling back Corporate Average Fuel Economy, or CAFE, standards and frontal assaults on the Environmental Protection Agency and other air-quality regulators, G.M. The idea here is to be more profitable whatever the cost.īut if anything seems shortsighted about the sale, it is the self-inflicted loss of passenger- and small-car engineering smarts that Opel represents. This had led it to now focus resources on the American and Chinese markets, which - it doesn’t mention but might as well - are more profitable. cited the regulatory climate, which the company notes with understated accuracy has changed. But explaining the Opel sale (which makes PSA the second-biggest company in Europe after Volkswagen), G.M. Viewed as terminally unsexy compared with tech stocks, the company’s shares have remained, like most automobile outfits’ valuations, depressed for years, even in 2016, when G.M. executives, including President Dan Ammann, a former Morgan Stanley managing director, but in today’s market it’s not necessarily a healthy one. Getting shares to rise is an understandable preoccupation of G.M. Indeed, the hope is that share prices will rise despite the $4.5 billion write-down the carmaker is expected to take against the European sale, as well as the pension obligations in several countries it will remain stuck with. This in turn will presumably enhance the firm’s ability to buy back its shares and help to increase shareholder value.

#Chevy writedown sale free

It is true that purging its European operations, which have admittedly lost billions since the turn of the century, could free up cash in the not-too-distant future for G.M. learned from previous energy crises and its 2009 bankruptcy and federal bailout. Along with G.M.’s decision to join other car companies that have pleaded for a rollback of pending fuel economy regulations, the sale raises the question of how much G.M.

in selling off the divisions known for building some of its most sophisticated small- and medium-sized passenger cars is outweighed by the real hazard to the corporation’s longer-term health as well as that of the world’s population, who most clearly don’t benefit from greater emissions of carbon dioxide and other pollutants associated with larger, less fuel efficient cars. tell it, offloading the brands in a fell swoop to PSA Group - a consortium whose owners include the French government, China’s Dongfeng Motors and the Peugeot family - makes simple, financial sense.īut any benefit of the $2.9 billion sale is worrisomely short-term, an unwelcome skid away from the passenger-car technology. Why is America’s biggest carmaker, General Motors, suddenly quitting Europe, dumping the German Opel and British Vauxhall subsidiaries it has owned since the 1920s? To listen to G.M.