In a recent interview with Bloomberg Television, GM CEO Dan Akerson said that The General is in the “best fighting trim” in five decades to handle a global slowdown.
“Prior to bankruptcy we had almost $40 billion in debt and were limited to almost no cash,” Akerson said in a Bloomberg Television interview in Shanghai last week. “Today we have minimal debt and about $34-$35 billion in cash. I would argue we are in the best fighting trim we have been in since probably the 1960s.”
It’s this $34-35 billion in cash that is permitting General Motors to heavily invest in Research and Development while expanding the competitiveness of its product portfolio.
The GM Authority Take
Sure, GM may be in the best fighting shape of the last half century… on paper. If anything, though, it still has a moral debt to repay to the American taxpayer, with many citizens vouching to never buy a GM product due to the bailout.
Here’s our question: do you think that those squarely set against the bailout would ease their stance if the government ended up breaking even or turning a profit on the transaction?
For that to happen, GM’s stock price would have to trade upwards of $50 (at current share distribution) for the government to collect the remaining $25 billion that it hasn’t yet recouped from The General’s orchestrated salvation.