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      03-31-2009, 11:51 AM   #1
mwarsh1
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Is It Bad For Bmw If Gm goes Out Of Business

Just A Random Thought, And Wanted To Say Whats U To All My E90 Frineds!
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      03-31-2009, 11:54 AM   #2
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Of course it'd be bad for BMW. I'm sure they share some providers, and if GM goes out, so do the suppliers, so it will be bad for BMW. I'm sure there are millions of other reasons, but I can just think of that one off the top of my head.
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      03-31-2009, 11:59 AM   #3
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It'd be bad and good, of course. Probably more bad because of the fact that they're hardly direct competitors.
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      03-31-2009, 12:04 PM   #4
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It doesnt just have to do with gm, but more to do with the suppliers that would go out of business if gm failed. Theres a huge infrastructure that exists below the car manufacturers and they depend on eachother. Less options is always bad.
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      03-31-2009, 12:10 PM   #5
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It doesnt just have to do with gm, but more to do with the suppliers that would go out of business if gm failed. Theres a huge infrastructure that exists below the car manufactures and they depend on eachother. Less options is always bad.
Understatement emboldened.
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      03-31-2009, 12:11 PM   #6
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Let them fail!

Short term it will be painfull -- long term it will be better. Unless they can shed the legacy costs and thinking, nothing can go forward.

If there is money to be made and a void is created, new money will come in to fill that void.

In any free market system, failure is required to clean up the mess. It is creative destruction at work -- just let it happen!

For most modern companies, nothing changes until they have a heart attack or worse!
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      03-31-2009, 12:13 PM   #7
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Depends on how many suppliers they share. If they share a few in the US only then it will most likely be negligle to BMW as they have only one plant in the US and many more around the world. On the other hand if GM no longer produced vehicles, including Cadillac, Hummer, etc; where these people could also buy a BMW, then they could sell more cars to these customers.
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      03-31-2009, 12:20 PM   #8
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Let them fail!

Short term it will be painfull -- long term it will be better. Unless they can shed the legacy costs and thinking, nothing can go forward.

If there is money to be made and a void is created, new money will come in to fill that void.

In any free market system, failure is required to clean up the mess. It is creative destruction at work -- just let it happen!

For most modern companies, nothing changes until they have a heart attack or worse!
Ahh, the cornerstone of any capitalist economy.... Except for this one of course. Stupid government.
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      03-31-2009, 12:56 PM   #9
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this is bad for BMW b/c the number of car companies decrease. this will put a lot of pressure for manufacturers to merge to contain costs and manuever through this financial crisis. as one of the only few independent car companies left, for the most part, BMW has stay true to its roots.

also, if more car companies start to go bankrupt, people will buy even less cars (as if sales arent already down). this further erodes the overall infrastructure that people talked about above.

unfortunately, it wouldnt surprise me at all if eventually BMW were to merge with Mercedes or Audi in order to survive; that will be a SAD day
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      03-31-2009, 01:00 PM   #10
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directly affect? depends on if they spin off their component divisions...
GM's transmissions division supplies bmw with their regular 6sp autos (most of the autos aside from the N54 sport automatics)
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      03-31-2009, 01:02 PM   #11
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How long would it be until GM's assets would hit the market? Buying factories already equipped to build cars, along with the machinery in place to do it would be tempting for surviving automakers.
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      03-31-2009, 01:03 PM   #12
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How long would it be until GM's assets would hit the market? Buying factories already equipped to build cars, along with the machinery in place to do it would be tempting for surviving automakers.
i can think of a bunch of chinese automakers that would be drooling at that prospect.... aside from the labor costs...
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      03-31-2009, 01:05 PM   #13
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Ahh, the cornerstone of any capitalist economy.... Except for this one of course. Stupid government.
Um, we've never had a capitalist economy. Maybe in agrarian times, before the Industrial Revolution and all. But don't fool yourself into thinking we were ever a true "free market". Even then we had systems in place to divide land, build infrastructure.
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      03-31-2009, 01:07 PM   #14
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Um, we've never had a capitalist economy. Maybe in agrarian times, before the Industrial Revolution and all. But don't fool yourself into thinking we were ever a true "free market". Even then we had systems in place to divide land, build infrastructure.
Right, I agree. Just as Russia/USSR wasn't really truly Communist.

Of course we're not purely capitalist. But isn't the idea to keep government involvement and regulation to a necesssary minimum?
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      03-31-2009, 01:09 PM   #15
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GM isn't going out of business. It is not a furniture store. All that is happening is that parts of the company that are basically dead and have been for years are finally going to be let go. If a given unit is making money there will be no need to destroy it.

Chrysler on the other hand, is basically a furniture store. They say if you don't have anything good to say about the dead you should say nothing.
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      03-31-2009, 01:10 PM   #16
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the reality of cost to you..

Lets just say that I pay 10-12 per hour to factory workers (engineering technicians) that are just as qualifed as the workers that are paid 30-50 Per hour at GM. My employees work 8 hrs a day and are often 1099 independent consultants and are much more productive than the GM workers that work 8 hr days and play solitare for 1-2 hrs a day.

yeah, that guy who uses a 1 million dollar robot to put wheels and lugs nuts on GM cars gets paid 30-40 Per hour, plus benefits, external equity, pension etc. Go figure?

I dont think BMW will be affected, actually everyone will just go buy a Ford instead.
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      03-31-2009, 01:10 PM   #17
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Quote:
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Right, I agree. Just as Russia/USSR wasn't really truly Communist.

Of course we're not purely capitalist. But isn't the idea to keep government involvement and regulation to a necesssary minimum?
Government involvement is because they asked for loans. The problem with letting weak companies just disappear is all the infrastructure that they built up can costs many people their jobs and livelihoods. No good can come from so many people losing their jobs.
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      03-31-2009, 01:10 PM   #18
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How long would it be until GM's assets would hit the market? Buying factories already equipped to build cars, along with the machinery in place to do it would be tempting for surviving automakers.
It would/will likely be a reorganization bankruptcy (Chap 13), not a liquidation (Chap 11) so there may not be a ton of assets hitting the market. There will be some older, less efficient plants etc. that would get cleaned out, but the bulk of the changes would be restructuring the debt load, workforce, etc.

If the gov't goes through with the "structured bankruptcy" plan they're talking about now, I wouldn't be surprised if you saw some forced brand consolidation as well. Pontiac for sure, and maybe Buick as well.
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      03-31-2009, 01:11 PM   #19
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Quote:
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Um, we've never had a capitalist economy. Maybe in agrarian times, before the Industrial Revolution and all. But don't fool yourself into thinking we were ever a true "free market". Even then we had systems in place to divide land, build infrastructure.
That's true, but no perfect free market economy exists in the world. We're a lot closer than most countries are.

Agreed with the aforementioned notion of letting GM fail. Let the invisible hand do its work.
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      03-31-2009, 01:14 PM   #20
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It would/will likely be a reorganization bankruptcy (Chap 13), not a liquidation (Chap 11) so there may not be a ton of assets hitting the market. There will be some older, less efficient plants etc. that would get cleaned out, but the bulk of the changes would be restructuring the debt load, workforce, etc.

If the gov't goes through with the "structured bankruptcy" plan they're talking about now, I wouldn't be surprised if you saw some forced brand consolidation as well. Pontiac for sure, and maybe Buick as well.

Agreed. I think you've got your terminology mixed up though - Chapter 11 is a reorganization; Chapter 7 is a straight liquidation through a Section 363 sale.
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      03-31-2009, 01:14 PM   #21
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Quote:
Originally Posted by Pedal2Floor View Post
Let them fail!

Short term it will be painfull -- long term it will be better. Unless they can shed the legacy costs and thinking, nothing can go forward.

If there is money to be made and a void is created, new money will come in to fill that void.

In any free market system, failure is required to clean up the mess. It is creative destruction at work -- just let it happen!

For most modern companies, nothing changes until they have a heart attack or worse!
and what do you propose we do with all the unemployment...you gonna pay them all?
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      03-31-2009, 01:15 PM   #22
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Agreed. I think you've got your terminology mixed up though - Chapter 11 is a reorganization; Chapter 7 is a straight liquidation through a Section 363 sale.
Yep - was typing too fast! I think Chap 13 is the individual code, not the corp. code.
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