Tag Archives: General Motors

GM Back In The Auto Financing Business

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In 2006 when GM was faced with $10.5 billion in losses, they decided to sell their credit business, GMAC, so they could use the money to pay down some of its restructuring costs, shut assembly plants and buy out employees. Even though this deal helped GM restructure their company, the bailout in 2009 showed that GM had not learned from their mistakes.

GM announced Thursday, that they would be getting back into the credit business in a recent plan to buy AmeriCredit Corp., in an all cash transaction valued at about $3.5 billion. GM executives have said for months that they were missing sales opportunities due to lack of credit for lease deals and financing for sub prime buyers and that this is an opportunity to bring more people into the showrooms and help them with finance.

The two companies have had a financial relationship for years. AmeriCredit, which already works with about 4,000 GM dealers, now gets about one-third of its business from financing new and used GM vehicles. Overall, the auto financing company has about 800,000 customers and $9 billion worth of auto loans on its books.

The automaker says that its partner, Ally Financial — formerly known as GMAC Financial Services Inc., will continue to finance GM’s dealer inventory and make loans to buyers with good credit. GM says it is not considering a purchase of Ally’s auto financing unit in which GM sold controlling interest in 2006. The company eventually had to be bailed out by the U.S. government because of problems with its home mortgage loan unit.

Many feel that GM’s purchase of AmeriCredit is another multinational corporation finding loopholes to exploit, and that the credit practices that collapsed the sub prime housing market was actually started in the auto finance credit business. The recent Financial Overhaul bill that was just passed by Congress will not be of any help either, since automakers were exempt from it.

GMC Recalls Windshield Washer Heater

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In 2008 GM recalled vehicles for an overheating windshield washer heater. A fuse was installed as a rectification, however, new reports of problems with the heater overheating continue to exist. GM will be recalling these vehicles again, and will permanently disable and remove the heated washer fluid module. Below is a list of the vehicles recalled:

    2006-2009

  • Buick Lucerne
  • Cadillac DTS
  • Hummer H2
    2008-2009

  • Buick Enclave
  • Cadillac CTS
    2007-2009

  • Cadillac Escalade
  • Cadillac Escalade ESV
  • Cadillac Escalade EXT
  • Chevrolet Avalanche
  • Chevrolet Silverado
  • Chevrolet Suburban
  • Chevrolet Tahoe
  • GMC Acadia
  • GMC Sierra
  • GMC Yukon
  • GMC Yukon XL
  • Saturn Outlook
    2009
    Chevrolet Traverse

Owners may contact Buick at 1-866-608-8080, Cadillac at 1-866-982-2339, Chevrolet at 1-800-630-2438, Saturn at 1-800-972-8876, GMC at 1-866-996-9463 and Hummer at 1-800-732-5493 or at the owner center at www.gmownercenter.com.

Hydrogen Cars – Still An Option?

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It seems that lately there has been much talk about the electric car. The automobile companies have been investing large amounts of money into electric cars with the hopes of becoming the leaders in the industry. The installation of more charging stations has not only made it more convenient to charge an electric car, but the installation of solar charging stations has made the drain on the power infrastructure less of a problem.

Still, the hydrogen car lurks in the background. Tucked away on the Torrance campus behind a security guard and a locked gate, a system designed to power Honda’s limited-production FCX Clarity sedan and other hydrogen fuel-cell vehicles uses solar panels to power a machine the size of a mini-refrigerator. This system converts water into hydrogen and oxygen gases and then pumpes the hydrogen directly into the car. No fossil fuels, no pollution, no additional strain on the power grid — and all done at home. It’s called a residential hydrogen refueler, and only one currently exists. According to statements from automakers like Honda, General Motors, Toyota, and Mercedes they hope to begin selling hydrogen-powered production cars to consumers as early as 2015.

Other hydrogen fuel-cell cars, only available by lease, exist. Made by GM, Toyota and Mercedes, most of the lessees are in “station clusters,” specific geographic areas that have hydrogen fueling stations. It’s the scarcity of these hydrogen stations that’s seen as one of the biggest barriers to mass adoption of fuel-cell cars.

The installation of these residential hydrogen refulers would solve this problem, but at what cost? Honda won’t say, but it’s a promising technology that advances the trend toward consumers detaching from a fossil-fuel economy and becoming more self-sufficient. It’s a future in which American homes are less reliant on a large-scale infrastructure — power grids, and water districts — and provide at least some of the solutions themselves via solar panels, gray-water systems, rainwater harvesting and home-based car-refueling technology.

GM Stock Sale Anticipated

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GM stocks could be publicly offered as early as October of this year according to the government treasury department. GM said it may sell shares in late 2010 or early 2011, but the timing will be determined by the financial markets and the overall health of the auto industry. This much anticipated stock sale, is expected to be among the largest initial public offerings in U.S. history. The stock offering is a key part of GM’s recovery as it emerges from a government led bankruptcy last year.

“GM must determine that it is, in all relevant respects, ready to become a public company. For those reasons, it is critical that the process of preparing for a potential IPO be managed by GM,” the treasury department said. To pay off its shareholders the stock market would have to value GM at more than $70 billion. That would be nearly double Ford Motor Co.’s market, but far less than the total value of Toyota’s shares.

Automobile Recalls For May 2010

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Below are some of the automobile recalls for May 2010

  • Ford is recalling certain 2010 Fusion, Milan, and Escape vehicles manufactured between February 27, 2010 to March 26, 2010 for a park rod guide retention pin that may have not been properly installed. A vehicle parked without an engaged park pawl and without an applied parking break may roll causing an accident. Ford will notify owners and dealers will repair the vehicles free of charge. Owners may contact Ford at 1-866-436-7332.
  • General Motors is recalling some 2010 Chevrolet Express and GMC 2500, 3500, and 4500 Savana vans for a defective generator that may develop a short in the voltage regulator. This short could eventually lead to enough heat generated to cause an engine fire. Dealers will inspect and replace generators if necessary free of charge. The safety recall began on April 12, 2010. Owners can contact Chevrolet at 1-800-630-2438 and GMC at 1-866-996-9463 or at the owner center at www.gmownercenter.com.
  • General Motors is recalling certain 2010 Cadillac SRX, equipped with 2.8L V6 engines, for pre-ignition problems. This problem may occur due to the use of low octane (regular fuel) as opposed to the high octane (premium fuel) recommended in the owners manual and on the fuel filler door. If pre-ignition occurs, you may hear a pinging or knocking sound from the engine. This may result in a connecting rod or piston breaking. The problem will be corrected by dealers reprogramming the engine control module. The recall is expected to begin before June 11. Owners can contact Cadillac customer assistance at 1-866-982-2339 or at the owner center at www.gmownercenter.com
  • Honda is recalling some 2010 Acura ZDX vehicles manufactured between November 12, 2009 to March 22, 2010 for dashboard covering material that has no been properly laser scored. During a crash, the airbag will not deploy properly leaving passengers vulnerable to injury. Acura dealers will inspect and replace the part free of charge. The safety recall began on April 21, 2010. Owners may contact Acura Client Services at 1-800-382-2238. Honda’s recall campaign number is R34.
  • Porsche is recalling some 2010 Panamera S, 4S, and turbo 4 door sedans for a possible malfunction of the seat belt mount. If the front seats are adjusted towards an extreme position, the belt mount could detach form the anchoring system. Dealers will install additional locking elements free of charge. The manufacturer has not yet provided an owner notification schedule, but owners may contact Porsche at 1-800-545-8039.

Auto Sales Up – Motorcycle Sales Down

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After massive restructurings in the auto industry, things seem to be looking up. After ten consecutive money losing quarters, GM said that they have made an unexpected profit of $865 million in the first quarter. Even Toyota, still recovering from their biggest recall ever for unintended acceleration, said Tuesday that the January-March profit totaled $1.2 billion compared to a loss the year before. But when it comes to motorcycles and scooters, things are still looking grim.

Even though motorcycles and scooters are more economical to operate, their sales are down 4.6% in the first quarter compared to last year. Hard hit by a down economy that has tightened credit and by stable gasoline prices, motorcycle dealers are scrambling to find customers any way they can. With so few buyers in the market for new bikes dealers are focusing on parts, accessories and pre-owned motorcycles to survive. Many dealerships have also cut hours and staff.

Chevrolet Corvette Recall

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GM will be recalling about 40,000, 2005-2006 Chevy Corvettes equipped with tilt and telescopic steering. The company said that repeated movement of the steering column could cause a signal interruption in the active handling system, which could cause unintended braking, possibly leading to a crash.

Owners can contact Chevrolet at 1-800-630-2438 about recall number N100118 or contact the National Highway Traffic Safety Administration (NHTSA) at 1-888-327-4236 (TTY: 1-800-424-9153) or at www.safercar.gov.

GM Recalls Hummer H3s

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GM is recalling about 150,000 Hummer H3s and H3Ts built between 2006-2010. GM filed the recall with the National Highway Traffic Safety Administration (NHTSA) saying that the clips that hold the hood louver, the vent mounted on the hood of the H3, could detach while driving. GM has received two complaints in the U.S. and three in Japan in regards to this problem. The repair involves applying an adhesive to refasten the louver to the hood.

GM plans to send a bulletin to dealers outlining the fix this week, followed by a letter to Hummer owners next week on the recall.