
GM to lay off 4,250 salaried workers in North America starting Monday - joeyespo
https://www.wsws.org/en/articles/2019/02/02/auto-f02.html
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mimixco
Funny this article acts like the unions will save them. The unions are at
least half of what got GM into trouble in the first place!

A terrific documentary on this topic is _Live Another Day,_ about what really
happened during the bailout.

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gamblor956
No, the issue is that GM did share buybacks and is now low on cash. It's
entirely the fault of the executives.

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lurker213
No, the issue are the unions.

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gamblor956
No, GM did $10 billion of buybacks this year and now needs to "save" $6billion
by firing workers.

The cost of firing those workers? They've permanently lost those workers,
their families, and their friends as customers. Forever. So that some fat
#$@#$ shareholders can have a few more bucks in their bank accounts.

The unions are the only thing protecting those workers and the thousands of
jobs in the American supply chain that the executives are doing their best to
destroy.

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devoply
10 billion / 4250= 2.3 million

From Motley Fool:

GM targets a cash reserve of $18 billion, and returns any free cash above that
number to shareholders via dividends and an ongoing stock-repurchase program.
Since 2012, it has returned about $25 billion.

Why you wouldn't take that 25 billion and invest it in AI and electric cars is
baffling to me.

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csense
It would be great "creative destruction" if these plants could be replaced by
another industry.

What needs to happen is a company, or an industry, needs to spring up that
employs these thousands of displaced workers in places like Michigan and Ohio.

HN'ers, what kind of entrepreneurial ideas spring to mind? I'm drawing a blank
here.

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DanHulton
Marijuana.

For an example, look at the Canadian town of Smiths Falls. The Hershey's
chocolate factory closed in 2008. It was a painful loss for the town, a major
industry just gone.

Now "Tweed" a Marijuana growing company had taken over the space. They've been
hiring at a tremendous rate, and even are planning an expansion to the
factory, with even more jobs to come. Seriously, even the battered housing
market is picking up again.

It's not an opportunity that will last forever, but the companies that
capitalize on it have to opportunity to make a mint and a whole pile of happy
workers in the process.

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DeonPenny
It's obvious they are betting heavily on automation being the future. It's
risky but if it becomes true it's going to be world-shaking.

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endofcapital
Not at all. Read the article, GM themselves said they needed to free up cash
after all the recent share buybacks.

"GM has said the job cuts and plant closings will free up $6 billion in cash,
but the automaker has spent $10.6 billion since 2015 buying back its own
shares"

This is a direct transfer of money from workers and worker obligations (like
pensions, health insurance, etc) to shareholders. This has been happening a
lot lately in several industries as Wall Street demands everyone buy back
shares or get punished.

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wutbrodo
That's only looking at liquidity though, which isn't the only factor that goes
into these decisions. It's plausible that they made these decisions because
they weren't getting a good return on that investment.

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endofcapital
Sure, maybe, but one fact doesn't really relate to the other. The fact remains
that they just spent $10B on share buybacks, and they are now laying off
thousands and closing a few factories because they want to save $6B.

Even if they waited a few more years, the optics are just really bad. Not that
optics seem to matter like they used to, most companies just shamelessly do
this now.

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RhysU
I could spend $10B retiring shared and _also_ trim an underperforming $6B
investment. They can both happen without it being a sinister equality gap
event.

