Comments on: Delphi Heads for Chapter 7 Meltdown

By: cos999

cos999 — Mon, 08 Sep 2008 02:19:50 +0000

joeaverage:
VISTEON and FORD saw the day of reckoning coming and worked together to keep VISTEON out of bankruptcy. A deal was negotiated with UAW approval in 2005. FORD basically took back money losing plants and formed an LLC to sell them or shut them down. Here is the press release:
http://media.ford.com/NEWSROOM/release_display.cfm?release=21794
FORD still accounts for about 50% of VISTEON business though, down from about 75% before the deal. (educated guess, could be off by +/- 10%)

By: blindfaith

blindfaith — Mon, 08 Sep 2008 02:14:45 +0000

The purpose of Delphi was not to create a competitive parts supplier but to legitimetly dump all those high priced employees tied to all that unpaid for retiree benefits.

Delphi IS an absolute success for GM.

Can anybody argue this point?????

By: jolo

jolo — Sun, 07 Sep 2008 22:12:44 +0000

Gardiner Westbound stated:

A car is the sum of its parts. The long term reliability of one assembled from the cheapest crap available for a company nearing insolvency by a company in bankruptcy protection has to be concerning for knowledgeable potential purchases. It was a deal breaker for me.

The parts might be made by the lowest bidder, but you won’t find a better bunch of people to work with that makes sure they deliver a quality product, no matter what. Like the Debt2.8 (I don’t know who started that name, but it’s the greatest), Delphi’s problems are the BOD, upper management and a piss poor business plan. But the grunts that do the work, the engineers all the way to the shop floor folks, are the best. Which is why many are jumping ship.

By: mikey

mikey — Sun, 07 Sep 2008 03:32:54 +0000

Thank you conslaw.

By: joeaverage

joeaverage — Sun, 07 Sep 2008 02:03:09 +0000

How has Visteon aka ACH (automotive Components Holdings) faired compared to Delphi?

Same business, spinoff from Ford – also in trouble at one time. Dunno what their current situation is. Used to work on alot of projects for them through m previous employer.

By: ihatetrees

ihatetrees — Sat, 06 Sep 2008 21:30:39 +0000

Conslaw:
I talk with a lot of GM retirees, and I am astounded at how many have a big chunk of their retirement funds locked up in GM stock. Do not ever put more than a token amount of your retirement money in your employer’s stock.

I wouldn’t be that strict. A lot of old tech and pharma employees did very well holding a significant fraction of their retirement in company stock.

I’d go to 25 percent IF the firm I worked for was fundamentally sound.
Of course, one needs to be brutally ruthless and objective (characteristics probably rare in GM retirees). If you or the market deem a your firm’s stock troubled, take whatever window given to adjust your portfolio (including dumping of all your firm’s stock).

Actually, an observant, long term employee can develop a ‘feel’ for their employer’s prospects. Adjust when necessary and you’ve become a de-facto ‘insider-trader’ when it comes to your retirement fund.

By: Conslaw

Conslaw — Sat, 06 Sep 2008 21:06:02 +0000

What Motownr is saying is that some Wall Street types are planning on making money off of short term changes in stock price resulting in positive and negative news about GM. When stock gets as low as GM’s is right now, compared to where it used to be, even fairly mundane news can result in big spikes in the price. I’m guessing GM options for 2009 can be had for next to nothing, therefore, if there isn’t a huge disaster, they think you can make some money on the stock. Unless you are a daytrader, I don’t think what Mtownr had to say has a whole lot of relevance to your life.

One thing that’s been mentioned on TTAC before is that GM is still part of the big equity indexes, so our “safe” mutual funds have to own GM to track the index, even if they wouldn’t do so if the stock wasn’t in the index. As long as GM is in business and hasn’t been dropped by the indexes, the stock will have some value, probably more than the company is worth.

I talk with a lot of GM retirees, and I am astounded at how many have a big chunk of their retirement funds locked up in GM stock. Do not ever put more than a token amount of your retirement money in your employer’s stock. Even if the retirees’ pensions are guaranteed by the Pension Benefit Guarantee Corp, they will still feel the hurt with a GM bankruptcy.

Maybe Robert & Company can update us on the status of the funding of the UAW healthcare Veba, how much GM has contributed and when the next $ is due.

By: mikey

mikey — Sat, 06 Sep 2008 19:48:29 +0000

Could somebody explain to me in layman terms,what is motowner saying in his post?

By: MikeInCanada

MikeInCanada — Sat, 06 Sep 2008 15:09:14 +0000

I figured out where GM’s part of their $50 Bln ‘loan’ will go. To buy back their part of Delphi. Not directly of course, but it all goes into the same pot of money -it’s just how you categorize it.

By: motownr

motownr — Sat, 06 Sep 2008 14:46:38 +0000

There may be some real ‘red meat’ to this scenario: big hedge funds have been loading up on GM options in the Jan-Mar 09 timeframe. Traders that are watching the action say that the bets involve extremely out of the money prices….i.e., big expected swings in GM’s price.

Can anyone think of any other reason other than Delphi?

By: Gardiner Westbound

Gardiner Westbound — Sat, 06 Sep 2008 13:18:44 +0000

Pundits agree the latest iterations of the Cadillac CTS and Chevrolet Malibu are above average. Both achieved 4/5 stars on the TTAC rating scale; known for parsimonious endorsements.

By: william442

william442 — Sat, 06 Sep 2008 12:31:00 +0000

Sad. I spent a very interesting four years at Packard Electric; nice people and a good place to work.

By: jolo

jolo — Sat, 06 Sep 2008 12:27:24 +0000

Rumor at one of Delphi’s plants says Dec 10th is when all hell breaks loose. That’s when GM takes control of Delphi and re-assimilates it back into the collective. That will wreak havoc on the other car makers that Delphi makes parts for. They run the chance of losing their parts for their production. This is going to get real ugly real fast.

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