treyfitness009's blog

Chevy Volt - An Enthusiast's Perspective

I've blogged numerous times over the Chevy Volt's protracted, multi-year development process. This car symbolically represented a lot, for GM, the American auto industry in general, and the transportation future of this...clean cars auto detailing car detailing cars auto detailing car wash clean cars

Buckle Your Family Into The YouTube Ad Of The Year [Video]

The winner of the first YouTube competition for best ad worldwide was this public service announcement from England about wearing seat belts. C'mon, it can't be that good...what the...wow, no, I'm fine, it just got really dusty in here. [Copyranter] More »

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Volkswagen Design Chief Says New Microbus Concept is in the Works [La Auto Show]

Volkswagen's Microbus could be making a comeback according to comments made by Volkswagen's design chief Klaus Bischoff this week at the LA Auto Show. More »

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GM shares rise, but will it be enough for taxpayers?

Shares in General Motors are a pretty hot item. The stock opened today at $35 a share just a week after GM and its bankers decided to price the deal at $33. It closed at $34.19 a share and was originally slated to sell for between $26 and $29 a share. After two weeks of pitching investors, GM and the Treasury Department saw so much demand that they raised the price and decided to up the size of the IPO by 31% to 478 million shares. Including the overallotment option, which lets the banks take even more shares to sell to eager investors, they could be selling 550 million of them. Since it takes a share price of $43.67 a share for the government to break even on the remaining $40 billion investment in GM, one must wonder, what was Treasury thinking by putting even more shares into the deal?

Assuming it all sells as planned, the government will still own 500 million shares in GM, which is 33% of the company. To break even, those remaining shares must sell an average price of $53.07 in the secondary offerings, according to data compiled by Bloomberg. That means GM stock needs to take a 61% runup before the secondary offering for the feds to break even. It's not unheard of. Ford stock is up 65% this year. GM has made a profit of $4.8 billion in the first nine months of this year despite a wretched car market. So some investors have said that they see potential for a big jump over the long haul.

Here's the other possible calculus. Let's say GM stock runs up 20% between now and whenever the feds decide to launch the secondary offering. That means the stock sells for $39.60 a share. At that price, the government would be $13.47 a share short. On 500 million shares, the government would lose $6.7 billion on the investment. Can they justify $6.7 billion to save GM? Some would argue it's a small price to pay given the jobs preserved at GM, parts makers, dealers, etc. The fact is, those who hate the bailout will hate it whether it makes a small amount of money or not, purely on the principle of the thing. The Center for Automotive Research estimates that letting GM and Chrysler fail would have cost the Treasury $28.6 billion in 2009 and 2010 in lost income tax and social programs anyway. They say we made a good deal. So no matter how the IPO pans out, the legacy of GM's bailout -- presuming the company performs as expected from here out -- is fairly well settled.

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2011 VOLVO S80 Recall

Volvo is recalling certain models of the 2010-2011 S80, XC70, 2001 XC60 and 2010 V70 vehicles. They stated that there may be an intermittent fault in the driver?s airbag clockspring wiring connector for the supplemental Read the rest of 2011 VOLVO S80 Recall!auto detailing car wash clean cars auto detailing car detailing cars auto detailing car wash

2009 BENTLEY AZURE RECALL

Bentley has announced that they are recalling certain models of the 2007 through 2009 Arnager, Arnaget, Arnage RL, Brooklands, and Azure vehicles. They stated that there is a potential for the "B" hood ornaments retracting Read the rest of 2009 BENTLEY AZURE RECALL!detailing car wash clean cars auto detailing car detailing cars auto detailing car wash clean cars

2010 FERRARI 458 RECALL

Ferrari has announced that they are recalling certain models of the 2010 458 Italia vehicles. They stated that the heat created by the engine could cause Read the rest of 2010 FERRARI 458 RECALL!cars auto detailing car wash clean cars auto detailing car detailing cars auto detailing

Comment Of The Day: Quantitative Analysis Edition [Commenter Of The Day]

Unless you were trapped in a Chilean coal mine, you might have heard that General Motors started selling its shares again today. Big ups on dustin' off your shoulders, General, but putting your shares back on the market means there a few million sets of eyes looking over your every move, wondering what's next. And as this chart shows, by the end of the day, the euphoria has already started to wane. Another general, Generallissimo Spiegel, used our chart of the 2010 F1 season to teach another lesson. You might have to think on this one a bit: More »

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2003 FORD WINDSTAR Recall

Ford has announced that they are recalling certain models of the 1998 through 2003 Windstar vehicles manufactured from September 1, 1997 through February 28, 2003 and currently registered or originally sold in Connecticut, Delaware, District of Columbia, Illinois, Indiana, Iowa, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode Island, Vermont, West Virginia, and Wisconsin. They stated that after many years of vehicle service Read the rest of 2003 FORD WINDSTAR Recall!detailing car wash clean cars auto detailing car detailing cars auto detailing car wash clean cars

2011 Hyundai Elantra Heats Your Buns [La Auto Show]

Hyundai says not only will the 2011 Elantra squeeze 40 mpg out of a 1.8-liter, 148-hp four-cylinder engine, the top model will sport heated front and rear seats. That's one way to get hot for Hyundai. (Photo: Scott Nehls) More »

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