News / USA

Stock in Revamped GM Soars as Company Recovers

General Motors Co. CEO Daniel Akerson sits in the driver's seat of a 2011 Chevrolet Camaro parked in front of the New York Stock Exchange following GM's initial public offering, 18 Nov 2010
General Motors Co. CEO Daniel Akerson sits in the driver's seat of a 2011 Chevrolet Camaro parked in front of the New York Stock Exchange following GM's initial public offering, 18 Nov 2010

A year and a half after falling into bankruptcy, a revamped and slimmed-down General Motors saw its stock price soar as it began to sell shares in the new company.  It is a huge turnaround for the firm that needed $50 billion worth of emergency loans from the U.S. and other governments to survive the economic downturn and its own missteps.  

Investors who once shunned the auto company snapped up shares in the new General Motors, pushing the price up from $33 to about $36 in the first hour of trading.

The company went from losing billions of dollars a year to making more than $4 billion so far this year.

Related video report by Mil Arcega

In bankruptcy, the company drastically cut its costs by slashing its wages, workforce, and debts.  It also got rid of half of its eight auto brands.

Chief executive officer Dan Akerson says the new General Motors has learned from its mistakes and is building new, smaller, more fuel-efficient cars that win awards and sell well.

"You know, we are going to have to continue to prove ourselves," said Akerson.  "At the end of the day, the quality of the product, the design of the product will rule in the marketplace."

Akerson said GM will never forget those who stood by the firm, including the taxpayers of the United States and Canada.

The emergency financial support meant that governments became the owner of more than 60 percent of the company.  Some critics of the firm joked that GM stood for Government Motors.  

This initial sale of stock will repay much of that government aid, and may cut the government ownership to less than one-third.  Officials plan to sell those shares in future and hope the price will rise high enough that they can recover all the money used to rescue General Motors.

GM Chief Financial Officer Chris Liddell says the battered North American auto industry is in the best financial health in a generation, but cautions, the struggle is not over.

"I think we have a lot to do," said Liddell.  "This is still a work in progress and we are the first to admit that.  A huge amount has been done over the last few years and we are in as good as possible shape as you could expect.  But we still have a lot to do and a lot of expectations on us now."

General Motors unveiled its newest cars at an auto show this week.  Car buyers who said they never considered GM during the bailout are now giving the company a chance.

"They were an unstable company, and I would be worried about my investment in a vehicle," said car shopper Kathleen Kimberly.  "[But] I am shopping here now, so I am not worried about it."

President Barack Obama says it took some tough decisions to support American auto companies like General Motors.  He says the action ultimately saved an industry and many jobs.

You May Like

Multimedia Obama Defends Immigration Action

Obama says with his executive action on immigration, enforcement resources will be focused on 'felons, not families; criminals, not children' More

US-Led Airstrikes in Syria Kill Over 900: Monitoring Group

British-based Syrian Observatory for Human Rights says the toll includes more than 50 civilians, five of them women and eight of them children More

Report: Obama Broadens US Combat Role in Afghanistan

The New York Times says resident Barack Obama has signed a classified order extending the role of US troops in Afghanistan for another year More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
New Skateboard Defies Gravityi
X
November 21, 2014 5:07 AM
A futuristic dream only a couple of decades ago, the hoverboard – a skateboard that floats above the ground - has finally been made possible. While still not ready for mass production, it promises to become a cool mode of transport... at least over some surfaces. VOA’s George Putic reports.
Video

Video New Skateboard Defies Gravity

A futuristic dream only a couple of decades ago, the hoverboard – a skateboard that floats above the ground - has finally been made possible. While still not ready for mass production, it promises to become a cool mode of transport... at least over some surfaces. VOA’s George Putic reports.
Video

Video Falling Gas Prices Impact US Oil Extraction

With the price of oil now less than $80 a barrel, motorists throughout the United States are benefiting from gas prices below $3 a gallon. But as VOA’s Kane Farabaugh reports, the decreasing price of petroleum has a downside for the hydraulic fracturing industry in the United States.
Video

Video Tensions Build on Korean Peninsula Amid Military Drills

It has been another tense week on the Korean peninsula as Pyongyang threatened to again test nuclear weapons while the U.S. and South Korean forces held joint military exercises in a show of force. VOA’s Brian Padden reports from the Kunsan Air Base in South Korea.
Video

Video Mama Sarah Obama Honored at UN Women’s Entrepreneurship Day

President Barack Obama's step-grandmother is in the United States to raise money to build a $12 million school and hospital center in Kogelo, Kenya, the birthplace of the president's father, Barack Obama, Sr. She was honored for her decades of work to aid poor Kenyans at a Women's Entrepreneurship Day at the United Nations.
Video

Video Gay Evangelicals Argue That Bible Does Not Condemn Homosexuality

More than 30 U.S. states now recognize same-sex marriages, and an increasing number of mainline American churches are blessing them. But evangelical church members- which account for around 30 percent of the U.S. adult population - believe the Bible unequivocally condemns homosexuality. VOA's Jerome Socolovsky reports that gay, lesbian, bisexual and transgender evangelicals are coming out. Backed by a prominent evangelical scholar, they argue that the traditional reading of the bible is wrong.
Video

Video Ebola Economic Toll Stirs W. Africa Food Security Concerns

The World Bank said Wednesday that it expects the economic impact of the Ebola outbreak on the sub-Saharan economy to cost somewhere betweenf $3 billion to $4 billion - well below a previously-outlined worst-case scenario of $32 billion. Some economists, however, paint a gloomier picture - warning that the disruption to regional markets and trading is considerable. Henry Ridgwell reports from London.
Video

Video Mexico Protests Escalate Over Disappearances

Protests in Mexico over 43 students missing since September continue to escalate, reflecting growing anger among Mexicans about a political system they view as corrupt, and increasingly tainted by the drug trade. Mounting outrage over the disappearances is now focused on the government of President Enrique Pena Nieto, accused of not doing enough to end insecurity in the country. More from VOA's Victoria Macchi.
Video

Video US Senate Votes Down Controversial Oil Pipeline - For Now

The U.S. Senate has rejected construction of a controversial pipeline to transport Canadian oil to American refineries. The $5 billion project still could be approved next year, but it faces a possible veto by President Barack Obama. As VOA’s Michael Bowman reports, the pipeline has exposed deep divisions in Congress about America’s energy future.
Video

Video Can Minsk Cease-fire Agreement Hold?

Growing tensions between government troops and separatists in eastern Ukraine further threaten a cease-fire agreement reached two months ago in the Belarusian capital of Minsk. Critics of U.S. policy in Ukraine say it is time the Obama administration gives up on that much-violated cease-fire and moves toward a new deal with Russia. VOA's Scott Stearns has more.
Video

Video Chaos, Abuse Defy Solution in Libya

The political and security crisis in Libya is deepening, with competing governments and, according to Amnesty International, widespread human rights violations committed with impunity. VOA’s Al Pessin reports from London.
Video

Video US Hosts Record 866,000 Foreign Students

Close to 900,000 international students are studying at American universities and colleges, more than ever before. About half of them come from Asia, mostly China. The United States hosts more foreign students than any other country in the world, and its foreign student population is steadily growing. Zlatica Hoke reports.
Video

Video Ferguson Church Grapples with Race Relations

Many white residents of Ferguson, Missouri, say they chose to live there because of the American Midwest community's diversity. So, they were shocked when a white police officer killed an unarmed black teenager in August – and shaken by the resulting protests and violence. Some local churches are leading conversations on how to go forward. VOA’s Ayesha Tanzeem reports.

All About America

AppleAndroid