Such a shame that American tax payers bailed out GM, and that GM cannot have these jobs in America, instead exports them to China which in turn give's China the technology. What about all the small businesses of America that support this when its built in America.
What is the reason for the loss of American Jobs.
$$$$$$$$$ Unions $$$$$$$$$$$$$$$$$$$$$???
This really sucks.

A few facts although not everyone on this site is necessarily interested in the facts.

1. GM does business in more than 120 countries.

2. Roughly 70 percent of GM sales are generated outside of the United States; in most cases, those vehicles are not exported from the U.S.

3. GM imports no vehicles from China to the U.S. Every Chevrolet sold in the U.S., with the exception of the Spark, is built in North America.

4. Chevy Volt, Buick Enclave and Cadillac SRX, CTS and Escalade are exported from North America to China.

5. GM did not use U.S. government bailout money to build manufacturing footprint in China; since bankruptcy, GM has announced investments at 30 U.S. facilities totaling more than $7.1 billion, which created or retained 18,641 jobs.

6. In 2011, GM exported more than 275,000 vehicles from the United States.

Note that I have no interest in GM other than I own several GM vehicles and have 200 shares of GM stock which is a relatively minor part of my investment.

Also, this fall I attended IMTS (International Manufacturing Technology Show) in Chicago where I learned a new word -- reshoring. Yes, some of the higher tech manufacturing is moving back to the US. Also this was the largest show in their history. I also attended FabTech in Las Vegas which was also very robust. I went to these shows because we expect to buy some CNC machine tools and fabrication equipment in the near future as we expand our manufacturing in the US.

1. GM does business in more than 120 countries. Irrelevant

2. Roughly 70 percent of GM sales are generated outside of the United States; in most cases, those vehicles are not exported from the U.S. That’s the problem

3. GM imports no vehicles from China to the U.S. Every Chevrolet sold in the U.S., with the exception of the Spark, is built in North America. Applies to fully assembled vehicles with as many components made in China as possible.

4. Chevy Volt, Buick Enclave and Cadillac SRX, CTS and Escalade are exported from North America to China. For now

5. GM did not use U.S. government bailout money to build manufacturing footprint in China; since bankruptcy, GM has announced investments at 30 U.S. facilities totaling more than $7.1 billion, which created or retained 18,641 jobs. They used “different” money??

6. In 2011, GM exported more than 275,000 vehicles from the United States. And building plants in China to export more from the US?

… a new word -- reshoring. Yes, some of the higher tech manufacturing is moving back to the US. Also this was the largest show in their history. Some always are; outsource three, bring back one

Many of us may not appreciate it but, with or without New GM direct or indirect participation, the world will be surprised to see what 1,500,000,000 hard working determined Chinese and a well managed meritocracy can accomplish by 2020/2025.

USA, EU and many other industrial nations will be facing more and more competition and may be tempted to hide behind smart trade walls to fight local unemployment and economic stagnation.

WTO will have to be updated to face the challenge.

Our acquired high living standards are and will be challenged.

I wonder how much GM got as bail-out money from the Chinese government? Especially for creating so many new jobs in China?

"A White House report sent to Congress in August 2012 estimated the sale of the remaining G.M. stock acquired by the United States Treasury during the company's bankruptcy would result in a loss of $25.1 billion to the American taxpayer."

"Without financing during bankruptcy, GM and Chrysler would have had to go out of business, taking down many suppliers. That would have likely caused bankruptcies at the healthier automakers such Ford Motor (F, Fortune 500), who would not have been able to get the parts they needed to build cars. That is why Ford went to Capitol Hill in late 2008 pushing for the rescue of its rivals.

The Center for Automotive Research, a well-respected Michigan think tank estimates that the bailout therefore saved 1.5 million U.S. jobs by keeping GM, Chrysler and the companies that depended on them in business."

http://money.cnn.com/2012/09/06/autos/auto-bailout/index.html

$25.1 billion / 1.5 million = $16,733 per job saved.

Average unemployment check = $295/week. $15,340 per year. One year of unemployment checks would have pretty much equaled the $25.1 billion loss. If we actually loose that much by selling our stock early.

Throw in the tax revenues collected by those 1.5 million people who have been working for four years rather than drawing unemployment and welfare checks and you can see we made out quite well.

Tax payer money very well invested and it has yielded great returns.

BTW, GM stock is up 21% since the August close. About a fifth of that $25.1 billion "loss" has disappeared.

BW..USA (like Canada and Ontario) probably paid about $72/share for New GM stock. At current $28/share, they are still losing about $44/share or about 61%. Not a very good investment?

It seems that New GM will make more profits in China in the coming years than in USA/Canada. Wouldn't be surprised that New GM will close many high production cost plants in USA/Canada by 2020 or so.

Future (GM) electrified vehicles and many parts such as batteries, e-motors, controllers etc) will probably go from China/India/South Korea etc to USA/Canada and not the other way around? That will be the way for GM (and many others) to maximize their profits per vehicle sold.

The only way to reverse this trend would be to lower our high production cost or imposed very high (up to 300+?) import tariffs?

I've been trying to get a better understanding of how the US/GM stock issue played out.

"The Obama administration, which received a nearly 61 percent stake in GM's common stock as part of the bailout, cut its holding to about 32 percent after the automaker's $23.1 billion initial public offering in November 2010."

http://www.reuters.com/article/2012/09/21/gm-treasury-idUSL1E8KLAGM20120921

"The Company was relisted on the New York Stock Exchange and the Toronto Stock Exchange again on November 18, 2010 following a US$33-a-share initial public offering of US$23 billion, including preferred shares. The proportion of the Company held by the U.S. Treasury department reduced from 61% to about 26%, including preferred shares...."

http://en.wikipedia.org/wiki/General_Motors#Chapter_11_reorganization

It sounds like the US started with a majority holding (61%) and during the IPO sold off over half their stock. At a rather good price, $33 per share. That took the government from a majority stockholder to significant minority stockholder. However I believe that those are non-voting shares so the government has no direct influence on board selections or decisions.

If we/the government are/is now about $20 billion in arrears (discounting the unemployment/welfare savings and taxes collected) it would take a stock price of about $40 to 'break even'. That's not an unreasonable stock price to see in the next few years as the economy improves and foreign sales increase.

And, obviously, we've already recovered everything we put in. Plus a significant amount more. Not as lucrative as the Louisiana Purchase, but also not chickenfeed.

BW...I'm not sure of the US Treasury deal with GM but Canada/Ontario effectively paid $72/Share for the 150,000,000 shares they received and they are currently losing 60+% of the investment. It would have been worthwhile if GM had increased their local workforce but it is not the case. GM's local market share is still going down and it will close a few Canadian plants in 2013/2914.

However, the total Canadian car market is going up. Did we invest in the wrong guy?

A lot of people paid $72/share for the 'new GM' stock. And, yes, they have a paper loss. Overpaying for IPOs seems to be rather common. Insiders sometimes to get to buy at a good price and then others dive in and drive prices too high. First day trading can get bonkers, sort of like auctions at which people get caught up in the rising price and overpay.

Facebook shares sold for as much as $45 on opening day. They fell to $17.73 about three months later. That's another 60% 'paper loss'. The current price is $27.50.

I'd guess that purchasing first day shares is not a good idea unless you really know what you are doing.

I don't know why Canada/Ontario would have bought first day stock. Perhaps there was some plan to help out the US government by buying some of their shares at an inflated rate.

Some CA plants may be closing, but the US administration kept the rest of them in business. That's a plus for CA.
--

I can't sort out the details of how much the US paid for the GM stock it holds, but if paper losses were $25.1 billion in August and the stock is up from there then about 20% of that loss has evaporated. Losses don't become real until you sell the stock or the company disappears. I'm going to guess that the current administration will hold their stock until the loss is (hopefully) eliminated.

Remember, the government actually made money on the bank bailout. In addition to avoiding the immense expense of a total economic meltdown and almost certain world-wide depression.

Making a profit on GM would be one more bit of "in your face" fun. It's amazing how few people realize that historically debt has been less and business has been more profitable under Democratic administrations. Most of us live with the myth that Republicans are good for business when the opposite is true.

I wonder what shipping costs in the other direction.

Ships are basically empty going back to China.

" Twenty years ago, it was feared that Japanese auto makers would flood the U.S. with exports, and cause displacement of American auto manufacturing jobs in Japan. Today, almost 7 in 10 Japanese cars sold in the U.S. are produced in Japanese manufacturing plants in North America. What’s more, exported vehicles from Japanese plants in U.S. to other countries increased to more than 145,000, up from 94,000 in 2009.

Japanese auto makers such as Toyota (TM) and Honda (HMC) have invested more than $34 billion in the U.S. alone through 2010, and now employ over 40,000 Americans in 29 manufacturing plants, 33 R&D and design centers and dealer and distributorships, according to the 2012 report of the Japan Automobile Manufacturers Association."

The strength of the yen vs. the dollar is also a factor along with shipping costs in moving manufacturing to the US. Additionally manufacturing close to the market allows for products to be more easily designed for the local market.

http://exchanges.nyx.com/marc-iyeki/overseas-firms-creating-jobs-america

I've just decided to create a blog, which I have been wanting to do for a while. Thanks for this post, it's really useful! New York City tax preparation