Monday, September 24, 2007

GM continues on its slide to death

I have stated here before that GM is dead even though the body moves on. The latest strike is yet another nail in its coffin. Yet, neither GM nor the UAW have much choice. Since GM has not succeeded in designing enough cars which consumers prefer to Toyota cars, it has to reduce costs. Yet, one of its largest costs, accounting to, by its own calculation, $1700 per car, is the cost of health insurance. Given the inefficient and expensive system used in the US, this is inevitable. However, reform of the healthcare system, while necessary, would not save GM for long as the company still cannot make cars which are in sufficient demand.

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