GM will expand its exclusive Cadillac only assembly plant by adding an all-new small car there, the automaker announced this week. The new vehicle will add 600 jobs to the Lansing Grand River plant in Lansing, Mich. GM says it will announce the name and look of the vehicle as well as when it will launch the car at a later time, likely at the L.A. or Detroit auto shows.
The new Cadillac will be a small car, according to GM’s CEO Dan Akerson. It’s an interesting move for GM’s flagship brand, which lacks a proper flagship vehicle to compete with the Lexus LS, Mercedes-Benz S-Class or BMW 7 Series, but a smaller car also makes sense. It's unknown if the smaller car will be based on the Chevy Volt like the Cadillac Converj concept shown above.
While the CTS is Cadillac’s current base sedan entry, the vehicle is actually a lot larger than its BMW 3 Series, Audi A4 and Mercedes C-Class competitors, which are technically compact sedans. In fact, the CTS is more than a foot longer than the BMW 3 Series; it nearly matches the exterior dimensions of the BMW 5 Series. Because of its price and smaller interior dimensions, the CTS' competitors are by and large the popular smaller sedans from the German brands.
By the time the new smaller sedan is released, the CTS could get an overhaul, as well. Add the anticipated large XTS flagship and the brand would have a trio more in line with the 3, 5 and 7 Series from BMW; the A4, A6 and A8 from Audi; and C-, E- and S-Class from Mercedes.
Thursday, November 4, 2010
GM IPO Set; You Buying?
General Motors announced today that it is filing a public offering of stock Nov. 18 and that the price of the common stock will be between $26 and $29 a share. The sale comes nearly two years since President George W. Bush first approved a bailout of the auto industry and 18 months after President Barack Obama sponsored a government-backed bankruptcy and ownership stake in GM and Chrysler.
The sale of nearly 365 million shares will raise as much as $10.6 billion for the company. The U.S. Treasury plans to sell a portion of its shares after the IPO, but it is unclear how much. Many analysts suggest the government will still lose money on the deal. One number mentioned today was a $131 share price for the government to break even.
No matter the balance sheet, the IPO will mark the beginning of the end of government ownership of GM, and it will put the company back on the free market. So the question remains: Would you buy GM stock?
The sale of nearly 365 million shares will raise as much as $10.6 billion for the company. The U.S. Treasury plans to sell a portion of its shares after the IPO, but it is unclear how much. Many analysts suggest the government will still lose money on the deal. One number mentioned today was a $131 share price for the government to break even.
No matter the balance sheet, the IPO will mark the beginning of the end of government ownership of GM, and it will put the company back on the free market. So the question remains: Would you buy GM stock?
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