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by mojonixon
6291 days ago
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I can't tell if you're joking or not.
GM paid dividends up until last year, decades after it was known that they had large health care obligations. Divert a couple years of dividends in keeping their side of the bargain, and GM is in good shape. GM management made a deal they were unwilling to keep. AMD employs 15,000. GM directly employees 240,000 and suppliers employ millions more. These companies are not easily replaceable. If they were, another company would have replaced them by now. Setting up an operation of that magnitude requires decades of experience and huge capital expenditures. |
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If you look at the post I said that GM did not take into account their future obligations. Their profits was nothing more than fancy bookkeeping.
> GM management made a deal they were unwilling to keep.
I agree with you on the point that GM should never have made those lavish packages and kept their salaries in line with the market (or relocated their factories).
> These companies are not easily replaceable. If they were, another company would have replaced them by now.
There are numerous companies that can replace the big auto companies. Toyota and Honda has been slowly replacing GM is most of the world markets (including the US). If either GM goes into bankruptcy and gets split up/sold off (e.g. Opel gets sold etc...). It would not be a bad thing.
> Setting up an operation of that magnitude requires decades of experience and huge capital expenditures.
Setting up a car manufacturer is not that impossible in the market. Over the past years there were 10s of new car manufacturers that started (and some failed). A good example is some Chinese companies such as GWM, Cherry. There is also no reason why existing car manufacturers can not grow to fill the gaps that GM leaves (as they have done for a long time – e.g. Hyundai, Honda, Toyota, etc...).
> AMD employs 15,000. GM directly empl
Starting a new x86 processor manufacturer would probably be impossible. The x86 is a patent minefield (to which only AMD and Intel have cross licenses to use each other's patents). Setting up a new generation fab can cost more than $5 billion.
And if AMD goes Intel will have a monopoly. Both Chrysler, GM and Ford can disappear and there still will not be a monopoly.