DETROIT — The General Motors Corporation reported a stunning second-quarter loss of $15.5 billion on Friday because of a dramatic decline in United States sales and charges for job cuts, plant closings and the falling value of trucks and sport utility vehicles.
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The dismal earnings reflected the impact of steadily falling vehicles sales in the overall United States market, and a huge shift by consumers away from the trucks and S.U.V.’s that were once G.M.’s most profitable vehicles.
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In its second-quarter report, G.M. said it had $21 billion in cash reserves and access to another $5 billion in credit.
But the automaker is burning through about $1 billion a month in cash as it tries to keep financing new product programs amid falling sales and revenues.
G.M., like its Detroit rivals Ford and Chrysler, was surprised by the abrupt shift to smaller, more fuel-efficient cars.
I am a hard core coffee addict and I know exactly what can and will happen if my supply is interrupted–excruciating emotional and physical anguish. For GM and it’s brethren in Detroit to have been surprised would require stunning incompetence or equally awe-inspiring indifference.
Or maybe it’s just good old fashioned greed.
Upton Sinclair wrote, “It is difficult to get a man to understand something when his salary depends upon his not understanding it.” GM, Ford and Chrysler prove it.