As expected, General Motors posted horrendous 4th quarter numbers this morning with the company losing $9.6 Billion. For all of 2008 GM lost $30.9 Billion making it one of the worst years ever for the auto maker. How bad was it?
Every day last year GM lost $84.7 million.
No wonder it's now on a lifeline courtesy of the Federal government. Without that lifeline (and a $4 Billion loan) GM would have been dangerously close to not having enough money to run its business day to day. GM ended the year with $14 Billion cash on hand. It needs $11-14 Billion minimum.
That's what happens when you burn through $67.4 million in CASH a day - every single day in the 4th quarter.
After a while, the numbers become so great it almost numbs you. Given how slow sales are so far this year, and with GM cutting production the numbers won't be much better in the first quarter. This company's business is under pressure not only here in the U.S., but around the world. CFO Ray Young tells me the credit crisis that stalled sales here in the U.S. has spread to Europe and Latin America, so GM revenue in those regions is down.
Bottom line: GM is far from seeing light at the end of the tunnel. It will need billions more (potentially as much as another $16.6 billion) from the Federal government. And while the company is moving fast to cut costs, 2009 is on track to be another one with billions in losses.
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