By Frank Williams
February 14, 2008 -
GM's record losses last year is Canada's fault– at least part of it anyway. GM CFO Fritz Henderson told Financial Post "three-tenths of a billion" of the $38.7b loss was due to foreign exchange losses. In other words, "This is largely driven by the strengthening C-dollar versus the U.S. dollar and the impact on our balance sheet through the 2007 calendar year." And in spite of CAW president Buzz Hargrove's insistence he will give no concessions in the upcoming contract negotiations, the handwriting is on the wall; Canada is now the most expensive place in North America to build cars. David Healy, an analyst at Burnham Securities: "[GM]'s strategy would likely be to do some hedging and hope that everything settles down. But Mexico and the U.S. are looking more attractive than they were to build future product." Looks like Buzz may be reconsidering his stance, if he wants to keep his union's members employed and paying their dues.
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February 14th, 2008 at 10:49 am
Oh Buzz, the only time you looked more ridiculous than this was when you endorsed Captain Disaster Paul Martin in the last election.
February 14th, 2008 at 10:50 am
So without the rising strength of the Loonie against the dollar, GM would have only lost $38.4 billion? Clearly GM has it’s eye on the path back to profitability.
February 14th, 2008 at 10:51 am
So it’s Canada’s fault that the value of the US dollar is falling? GM is just playing this up as leverage for the upcoming CAW contract talks.
February 14th, 2008 at 11:10 am
Blame Canada
February 14th, 2008 at 11:12 am
Blame Canada
Blame Canada
With all their hockey hullabaloo
And that bitch Anne Murray too
Blame Canada
We must blame them and cause a fuss
Before somebody thinks of blaming us!
The loonie hasn’t really shot up that much… Its the US dollar that has fallen.
Just sayin’.
February 14th, 2008 at 11:26 am
A lot of us like gettin’ blamed. Makes us feel tough, a change of image from that Dudley Doright crap.
February 14th, 2008 at 11:37 am
You forgot Bill Shatner, RUSH, and those frenchy-french Quebec folks… Damn Canucks… Gotta blame someone I guess, not the incompetent, complacent, and…
February 14th, 2008 at 11:44 am
A lower level young wanabee union rep informed me the other day that ” We are taking GM on in the fall and to save up my nickles and dimes for the strike”Really?He went on to tell me how he was not gonn’a take any American style concessions.
I answered “Young man your talking to the wrong guy.Go out the line and tell that to one of the young fellas.You know the guy with the 250K morgage,2 car payments 2 cell phones 3 kids and his wife works on the other shift.Yeah you just tell em son wer’e going on strike for about 6 monthes.After that GM moves the whole operation to the US [corp home].9000+salary+ suppliers all out of work.I then told him to “go away”actally I used another term it means the same as go away.
February 14th, 2008 at 11:49 am
I have two words: Tim Horton’s.
February 14th, 2008 at 12:35 pm
troonbop,
Welcome to the club. The US gets blamed for every ill on the planet all the time…. even things that happened before we were a country.
February 14th, 2008 at 12:39 pm
Before you Canadians get in too much of a snit, if you read the article no one actually accuses Canada of anything, and in fact GM is saying that the appreciating loonie only cost them $300 million USD in earnings, 1% of their year’s loss.
They’re simply pointing out the obvious and indisputable fact that the changing ratio of the currencies hurts a U.S. company that has a lot more costs than revenue priced in Canadian Dollars.
February 14th, 2008 at 1:21 pm
Buzz Hargrove has caused more damage than any increase in the Canadian dollar ever could. As near as I can tell he would rather fight for all the prehistoric union rights than keep the plants open. While Buzz fiddles the UAW has made a deal which Buzz promises not to match even at the cost of his members jobs. Of course Buzz will have a gold plated pension deal which he will soon be collecting, why should he care.
February 14th, 2008 at 1:37 pm
Hmmmm interesting. The Canadian dollar is responsible for less than 1% of GM’s loss. So who’s fault is it for the other 99%?
Also if note, the loss comes inspite of the fact that GM cars made in Canada costs more to buy in Canada than in the US. Does that mean GM Canada can be accused of dumping cars into the US?
Nothing to get all uptight about. $300M due to the increase in value of the Canadian dollar is probably a whole lot less than most people thought.
February 14th, 2008 at 1:43 pm
Buzz is like a 1917 new soviet man who just woke up from a 90 year coma.
February 14th, 2008 at 2:56 pm
Regardless of expense, us Canadians actually know how to build cars. Of the cars made in Canada, almost all of them are great selling, very reliable, popular models. Which can’t be said for a good number of American-made models. Canada’s got the Civic, a few Lexus and Acuras, Corolla, Camry, Impala, Crown Vic, Charger… a Suzuki or two (okay, not the most popular)… uh… any I’m forgetting?
February 14th, 2008 at 3:47 pm
Alright, this blame game has gone too damn far!! : )
The Big three need to understand that they are in the business of building cars. Cars that people want to buy! If they were to accomplish this, while making a net profit on each desirable car they sell, then the company will make money. Building mediocre cars, that people don’t want, and selling them at a net loss can only last for so long.
February 14th, 2008 at 3:59 pm
Regardless of expense, us Canadians actually know how to build cars. Of the cars made in Canada, almost all of them are great selling, very reliable, popular models. Which can’t be said for a good number of American-made models. Canada’s got the Civic, a few Lexus and Acuras, Corolla, Camry, Impala, Crown Vic, Charger… a Suzuki or two (okay, not the most popular)… uh… any I’m forgetting?
GM Trucks as well.
February 14th, 2008 at 4:57 pm
GM has it backwards again. The Canadian dollar has been relatively stable against other world currencies. It’s the U.S. greenback that’s tanking.
Physician, heal thyself.
February 14th, 2008 at 6:21 pm
If the closing of those factories results in Canada learning that the government cannot pick winners and losers, and should get out of the tax and subsidize game, it will be the best thing that ever happened to them.
Go, Buzz.