Sunday, July 12, 2009

The New General Motors is Venture Capital.

The New General Motors arose phoenix like from the ashes of its former self and started to beat the marketing and corporate communications drum. It wants to sell cars. It needs to sell cars. Can it come out with decent cars in the very near future. The shareholders have been wiped out. Governments and a union VEBA have the overwhelming majority of the shares. The old GM (GMGMQ) continues to trade on pink sheets despite warnings from everyone that the shares may soon be worthless.

An IPO is already being spoken of the new General Motors, green logo and all, will need enormous amounts of capital. Right now we do not know what the board looks like. We do not have a good handle on what the new financials look like. We have no reason to believe that the fall new car season will be kind to General Motors. Now that we have stripped away the legacy problems here are the drivers of shareholders value.

1. Majority shareholders who do not think like shareholders
2. Suspicions of juicing results to make the entity look extremely attractive
3. Other competitors have no intention of letting the new General Motors thrive
4. New compelling car models. Will Camaro really do it?

The New General Motors is Venture Capital.