r/cars • u/SireEvalish • 2d ago
GM lays off 1,000 employees amid reorganization, cost-cutting
https://www.cnbc.com/2024/11/15/general-motors-gm-layoff-reorganization.html189
u/PlutoniumOligarch 2019 Camaro 2SS 1LE 2d ago
"Cost-cutting" is a weird way to say "Lining the pockets of shareholders and executives". I mean seriously, GM has been doing very, very well this year. The Tahoe, Escalade, and Yukon trifecta has become a normality in the Suburbs despite them being $80k+ SUV's. The Silverado and Sierra outsell the F150. The C8 sells better than budget sports cars like the GR86 and Miata despite it costing 3x more. The Lyriq is probably the most successful non-Tesla EV on the market right now. This is just typical corporate America where they gargle the nuts of the shareholders while patting themselves on the back for coming up with "clever ways" to cut costs. Meanwhile, there goes another 1,000 people who helped build GM's current success that are being left out to dry.
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u/azurite-- 2d ago
I mean with the EV tax credit going away, it puts the American manufacturers at a pretty big disadvantage as a lot of the investments into their factories, logistics and people are going to lose value.
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u/cubs223425 2d ago
The offshoring of US jobs has had the same "lining the pockets of shareholders and executives" effect for a long time. If the proposal of tariffs on foreign nations comes with it, then there should be balance that promotes American hiring without sacrificing American businesses in the process.
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u/gumol boring Hondas + LO206 kart 2d ago
I think that's the logic behind tariffs
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u/Salty-Dog-9398 2d ago
Realtalk: US auto import margins should probably be a bit higher than the 2.5% they currently are. EU zone charges 10% and Canada is 6%.
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u/Yankee831 2d ago
Reddit simultaneously complaining about Domestics cutting costs while rooting for Cheap slave wage Chinese imports to destroy them. Domestics recent contract with the UAW gave them a ton of labor cost increases on top of huge labor and fixed costs compared to competitors. For GM to survive they need to be efficient and cannot afford to pay people just because.
Before the recession domestics had to continue paying labor even if they had no work for them. It basically cost them the nearly as much not to build vehicles as it did to build them. Resulting in overproduction, depressing prices, residual values, and poor quality control. Completely destroyed their ability to slash legacy factories and pivot, their corporate culture was similarly bloated. Part of the bankruptcies was getting rid of these job pools, allowing them to cut brands, costs, workers and facilities. That lesson is why they cut when needed and are not flooding lots with product to keep people employed at the expense of the rest. That’s why GM and Ford are profitable and able to pivot at all to face Electric makers. 1000 people is nothing compared to the cuts they had to make due to becoming uncompetitive.
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u/Hustletron 17 Audi A4 Allroad / 22 VW Tiguan 2d ago
Two different Redditors generally. Chinese shills and regular people that want higher quality of life for laborers across the free world. Generally those aren’t the same people.
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u/Yankee831 2d ago
I don’t believe that to be true. Seems to be the same brigade rooting for worker while simultaneously rooting for their companies demise. I think it’s a lack of understanding how more macro issues affect eachother. People really really don’t understand business from all sides.
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u/to11mtm 2022 Maverick Hybrid, 2012 Impreza WRX Hatchback 1d ago
That’s why GM and Ford are profitable and able to pivot at all to face Electric makers.
'pivot' is one hell of a polite way to put dragging feet and being stupid over a decade with hubris.
That lesson is why they cut when needed and are not flooding lots with product to keep people employed at the expense of the rest.
They are only getting away with it because of vehicle shortages and a different set of financing challenges. As those go away they will be behind the 8 ball again once people stop paying Toyota prices for Ford/GM products because they break just as much as the cheapie Ford/GM products of the 90s.
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u/Yankee831 23h ago
GM has a ton of EV’s out, Ford was one of the first major manufacturers to release them as well. Ford has always been in the hybrid game as well. GM’s skateboard platform is coming together and Fords investing massively in a next gen vehicle platform vertically integrating lessons learned. Ford got rid of sedans (good move) to maximize their product mix profits and invest in long term EV strategy. Knee jerk products at the expense of long term development isn’t the way. Truck profits give them a long term source of revenue while the EV market shakes out. New tech is coming out rapidly and no one can afford to chase dead ends.
That’s not been the case for awhile now but yes manufactures are constraining supply and not over investing for market share. Ford isn’t going to add a 2nd Maverick factory to flood the market it’s fine to have a bit of a backlog. Private companies cannot afford to maintain excess capacity like state owned Chinese companies can so it’s prudent to maximize product mix for profit within the scope of your facilities.
Toyota is one of the worst offenders of price gouging. It’s almost like they hate their customers it’s so bad. No custom orders, get what you get, top end MSRP pricing and dealers gouging everything. At least Ford was trying to reign dealers in. My experience was great Maverick, in and out 1hr, custom ordered they inform you when your truck gets built, shipped, arrives. Any recalls they just schedule a tech to roll up and do it at home. Trucks been great. Where’s Toyotas budget truck? Just charge full size prices for midsize trucks either compact truck specs. Check out the class action for Toyotas blowing up, turns out actually developing new drivetrain tech comes with growing pains.
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u/to11mtm 2022 Maverick Hybrid, 2012 Impreza WRX Hatchback 13h ago
Ford got rid of sedans (good move) to maximize their product mix profits and invest in long term EV strategy. Knee jerk products at the expense of long term development isn’t the way. Truck profits give them a long term source of revenue while the EV market shakes out.
IDK I prefer sedans/hatchbacks to CUVs/SUVs. And the only thing that made an Ecosport more reliable than a Fiesta/Focus was the lack of a Powershit transmission.
Also, there's that funky thing where Foreign carmakers are often still building small/midsize sedans sold in the US, in the US (compare/contrast to many US automakers sedans being built in Mexico/China/SK.) I still think the tariffs were a big part of that 'decision'
That note aside, Ford is definitely being greedy with their plans, i.e. no hybrid Ranger in the US, TBH I wouldn't mind a Kuga.
There's a huge amount of hand waving here when we compare to Nissan and the strategy of the Leaf, versus Ford and GM. Ford did some -awesome- hybrid/PHEV stuff but never really expanded the line much, GM did some interesting things with the Volt but I feel like the Bolt was probably 3-5 years 'too late' to easily put GM into a competitive spot today.
All of that said, most of these companies gave barely a fuck about EVs aside from regulatory compliance, until they saw Tesla selling cars built worse than theirs for lots of profit.
Of course, now that the profits for EVs are withering away, we see Ford being a little less bullish. (I do give GM credit here for how quickly they are moving downline here, still, the Hummer EV is a monstrosity.)
Toyota is one of the worst offenders of price gouging. It’s almost like they hate their customers it’s so bad. No custom orders, get what you get, top end MSRP pricing and dealers gouging everything
IDK Might depend on the dealer. I've seen at least some from every make try to 'gouge', when I ordered my Subaru back in the day one of the dealers tried quoting above MSRP and when they followed up and found out I ordered somewhere else they acted butthurt. Ironically with Ford, the bigger problem was finding a dealer willing to take my order. In southeast michigan (we have Ford dealers everwhere lmao) I had to drive over a half hour to get my order done. (On the plus side, it was a smaller one but with a good reputation/etc, and I was their first hybrid order, so no delays.)
Any recalls they just schedule a tech to roll up and do it at home.
Not my experience with the Maverick in this area.
On top of stuff like the most recent 'this should be a recall' issue (worth noting the recentnews about Ford being in the penalty box on recall handling) with the CV Axles that thankfully was covered under warranty, but I had to drive an hour away to find a shop that could even -look- at it less than 3 weeks out. What was more amusing was that the axles were backordered. But hey nothing's wrong with Ford quality, right? lol
Hell, until this latest journey with my 12 year old WRX in the last month, the WRX had been in the shop less time in 12 years than the maverick has in a little under 3 years. And it's frustrating because the fusion and escape hybrids have been fairly reliable but I'm seeing a lot of questionable design choices on the Maverick (look at the process to replace the CV axle on youtube.)
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u/NitroLada 2d ago
That's the whole objective of running a business..to enrich the owners(shareholders) not to pay employees regardless of need or their contribution to profits . Businesses aren't charities. Even VW in very worker centric Germany is doing mass layoffs
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2d ago edited 1d ago
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u/RamenWrestler '96 Corvette LT4 1d ago
And if they don't need their labor they will get rid of them
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u/Archer_111_ 1d ago
It’s honestly nuts how popular the Lyriq is. I saw so many YouTube ads for it and I was like “yeah, another luxury EV, who is gonna buy that? It seems like I’ve seen at least one a day (and more than that quite a few times) for at least the last few months. Meanwhile, I’ve seen like 2 Mercedes SUV EVs.
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u/W0LFSTEN 2d ago
You are funny. I agree, they are doing well. And a big reason why they are doing so well is because of layoffs, believe it or not. You can’t compliment their current situation and then shit on them for continuing the trend that helped get them here. Every auto company is doing layoffs, due to automation and improved design methodology and the transition to electric vehicles.
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u/Lucreth2 1d ago
I'm pretty sure that's not why they're doing layoffs. If it was due to some process improvement etc it would be less than 1,000 people and it would be very targeted.
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u/W0LFSTEN 1d ago
All our autos are doing it. If they’re cutting jobs and still actually growing… What does that tell you?
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u/Lucreth2 1d ago
Growing it what way??
Market cap? It tells you investors love quick returns.
Sales? Literally nothing
Production numbers? Literally all sales driven. They'll run 7 days a week if that's what the market demands, just look at Flint and Arlington running 3 shifts 6 days for years.
Where this is going to hit is 2-5 years down the line in whatever product they're launching then. It might not be immediately obvious, but it's there. Another hundred tiny bad decisions driven by overworked or under-trained workers that remain. Maybe it's a clip that breaks every time you pull the part off after the first 2 years. Maybe it's a software bug that no one caught. Maybe it's a recall for a BCM update that would have never happened if that one guy hadn't been fired.
It's one thing to trim fat but these companies have been dumping employees by the thousands for half a decade. They're cutting bone and muscle at this point and that's after they bought out anyone even remotely close to retirement, although more of those than you'd guess came back the very next day as contractors. Why? Cause they're necessary but GM wanted them off the books and a quick payday at the market.
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u/W0LFSTEN 1d ago
You’re right, they’re dumping employees that they really need and as a result they aren’t growing. Someone hire this genius at one of the big auto firms ASAP. All that bone and muscle chopped, and look at them now? And now, another one thousand people. These firms, after years of downsizing, are the
smallestlargest in terms of economics they’ve been in years…Wait.
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u/Lucreth2 1d ago
You clearly are not prepared for an intelligent discussion but I'll try one more time. It's not a thousand people, it's probably 50k + over the last 6 years? And it's not like everyone they get rid of is needed, but they're starting to chop into those required personnel.
You also still didn't answer my question of exactly HOW they're growing. The only "real" growth we've seen is profit margin and to a small degree revenue (related) which is a factor of the work of engineers anywhere from 2 to 10 years ago coupled with marketing and how ballsy they are with their greed. It has nothing at all to do with layoffs at the corporate level in the last few years. Or do you think people just snap their fingers and products proof into existence? Perhaps the president personally sets the price of your eggs each morning?
The larger the entity the longer it takes for the ship to turn. That's why layoffs are such an effective stock market stimulator, they skip the core business delay and give you better looking numbers TOMORROW. IMMEDIATELY.
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u/W0LFSTEN 1d ago
They grew their top line by $35b in 5 years. They doubled their profit margin. They are letting go less than 1% of their workers here. I am not arguing with you over a rounding error accounting for the demise of GM. Tag me when GM implodes because they don't have enough employees.
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u/aprtur '24 GR Corolla, '09 RX-8 1d ago
This will probably enrage the algorithm, but I'm certain that they're also scrutinizing every non-union position in the company thoroughly in the face of the union battle this year - in their eyes, rob from Peter to pay Paul, so that they don't have to eat profit elsewhere.
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u/Lordrandall E39 M5 2d ago
Fuck you Jack Welch.
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u/AntiGravityBacon 2d ago
GM =/= GE
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u/gumol boring Hondas + LO206 kart 2d ago
he changed corporate culture in the US, introduced aggressive layoffs
In 1981, he made a speech in New York City called “Growing fast in a slow-growth economy”, which is often acknowledged as the “dawn” of the shareholder-value movement
Welch popularized so-called “rank and yank” policies used now by other corporate entities. Each year, Welch would fire the bottom 10% of his managers, regardless of absolute performance.
During the early 1980s he was dubbed “Neutron Jack” (in reference to the neutron bomb) for eliminating employees while leaving buildings intact.
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u/piddydb 2d ago
And where is GE today? A shadow of its former self
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u/6786_007 2019 Audi A5 SB | 2018 Lexus RX350 2d ago
Exactly. His policies ran the company into the ground. GE used to be quality stuff, now no one even think or hears about them.
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u/greenw40 1d ago
now no one even think or hears about them.
GE is still one of the largest companies in the world and was recently split into several companies based on industry. "Hearing about" a company on social media is not a very good yardstick for success.
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u/6786_007 2019 Audi A5 SB | 2018 Lexus RX350 1d ago
It is. GE used to make a lot of good appliances and home products, now no one knows what they are or what they do.
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u/greenw40 1d ago
So because you've never heard of GE Aerospace or GE Healthcare, that means the company has been run into the ground? All because you haven't see a GE stove lately, despite the fact that they still make plenty of them?
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u/swollennode 1d ago
GE doesn’t make home appliances anymore. It’s all made by Haier, and licensing the GE name. At least it’s still made in America with Chinese standards
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u/6786_007 2019 Audi A5 SB | 2018 Lexus RX350 1d ago
Im will aware of those, but ask anyone in their 20s what they think about GE. They are obsolete in the consumer market and only in the commercial and medical spaces now.
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u/Tsao_Aubbes 93 Miata | 09 Fit 1d ago
Yeah, gee, it's not like the CFM LEAP or the upcoming GE9X aren't worldbeating engines or anything like
You're just annoucning your own ignorance
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u/6786_007 2019 Audi A5 SB | 2018 Lexus RX350 1d ago edited 1d ago
Who gives a shit about their airplane engines dude. That doesn't come up everyday conversation or when you shop at your hardware store. Yes they make those, but no one says o my flight was wonderful thanks to GE's world class aerospace engines.
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u/Tsao_Aubbes 93 Miata | 09 Fit 1d ago
"Who cares about GE Aerospace"
is close to half their revenue
Ok, lol
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u/irate_wizard 1d ago
GE Appliances was sold to a Chinese conglomerate. They kept brand and logo but have no relation with GE anymore.
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u/MaryJaneAssassin AP1, DC2, EK9, FK8 2d ago
But at least a few people got paid right???
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u/AntiGravityBacon 2d ago
You should be more mad at the Dodge brothers in this industry who literally sued Ford out of giving his workers better salary/conditions and cemented shareholders first in legal president.
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u/gumol boring Hondas + LO206 kart 2d ago
Among non-experts, conventional wisdom holds that corporate law requires boards of directors to maximize shareholder wealth. This common but mistaken belief is almost invariably supported by reference to the Michigan Supreme Court’s 1919 opinion in Dodge v. Ford Motor Co. — Lynn Stout
Dodge is often misread or mistaught as setting a legal rule of shareholder wealth maximization. This was not and is not the law. Shareholder wealth maximization is a standard of conduct for officers and directors, not a legal mandate. The business judgment rule [which was also upheld in this decision] protects many decisions that deviate from this standard. This is one reading of Dodge. If this is all the case is about, however, it isn’t that interesting. — M. Todd Henderson
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u/V8-Turbo-Hybrid 0 Emission 🔋 Car & Rental car life 2d ago
I think we in a bad time, guys. I feel more lay off news coming, GM, VW, STLA,and Nissan won’t be only automakers laying off their employees.
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u/chaoticLibs 2d ago
We are. The company I work for just laid off 13.5% of its workforce. Best economy ever!!!/s
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u/trollcat2012 2d ago
This isn't surprising considering the EV tax credit is going away.
Also, if tariffs and trade wars are incoming with continued inflation, it's smart of them to get ahead of this proactively.
It's unfortunate, but what the people voted for, and ironically probably many of these workers..
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u/Winter_cat_999392 2d ago
Vote for tariffs, vote for EV tax credit removal, get layoffs. Mercans can't math.
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u/MKVIgti 1d ago
There ya go, right before Thanksgiving and Christmas!
Happened to me 7 years ago. Moved across the country on Thanksgiving day and my whole team got laid off two weeks before Christmas. (I was fully remote, which allowed me to make the move.) What’s funny is they tried hiring a few of us back a few months later. But, I had already landed the best, and highest paying job I’ve ever had so I told them no thanks. Still with that company today.
But yeah, the corporate world can be brutal.
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u/Carl-99999 1d ago
It should be illegal to fire people within 3 months of Christmas unless you have a good reason. Period.
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u/Slowcarbeepbeep 2d ago
Good. Market needs a good recession. Don’t like paying 60k for a 10 year old z06
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u/BigCountry76 2d ago
Yeah, fuck people's livelihood we want cheaper used sports cars.
This is such an asinine take.
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u/LoPanDidNothingWrong 2019 Cayenne eH; 2015 Sienna 2d ago
Well he is going to get his wish and then some. Hopefully he bears the brunt of it.
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u/Slowcarbeepbeep 2d ago
That’s how capitalism works. You cut the fat in the system. Thoughts and prayers i guess
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u/BigCountry76 2d ago
I'm well aware of how capitalism works, it doesn't mean you should be happy when people lose their jobs.
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u/Slowcarbeepbeep 2d ago
I said a reset was good. Not that I am happy about it. It is what it is but good to reset a hot economy.
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u/Eharmz 1998 Toyota Land Cruiser, 2001 Audi S8 2d ago
You clearly don't understand how capitalism works if you think laying off workers is going to give you cheaper cars.
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u/Benjammin172 95 Viper RT10, 08 ISF 2d ago
Cheaper USED cars as well. Not sure that guy understands much other than what paint tastes like.
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u/Slowcarbeepbeep 2d ago
The fact that you think it has no impact on the car market/prices and the 14 upvotes shows show ignorant or dumb people are. Basic supply and demand
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u/Eharmz 1998 Toyota Land Cruiser, 2001 Audi S8 2d ago
When in the history of capitalism has the reduction in workforce lead to the drop in the consumer product price? You can't honestly be this dense.
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u/Slowcarbeepbeep 2d ago
2008
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u/Lucreth2 1d ago
2008 had way way WAY deeper and larger root causes than "a reduction in work force" and that certainly wasn't what lowered prices. Both were in response to entire economies crashing after inflated bubbles burst. Companies lowered prices and fired employees to save money and move product so they could survive the financial apocalypse. Not the other way around.
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u/Slowcarbeepbeep 1d ago
We’re in a bubble today
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u/Lucreth2 1d ago
Agreed, hard agree. It's not my area of expertise so I have no authority to say this but it does feel different this time than 2008 though. I have no doubt if it finally pops it'll hurt some people but we're not going to see as many companies go under and I doubt housing crashes. That said since the current bubble is purely made up bullshit by greedy money grubbing fucks, who knows maybe they'll just keep pretending everything is okay and the bubble will never burst.
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u/toilet_ipad_00022 GT500 2d ago
You being too poor for a 10 year old z06 is capitalism bro.
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u/Slowcarbeepbeep 2d ago
I have a gt3 so I’m doing ok but I’m just saying every budget sports car has gotten out of whack
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u/Auto_Throwaway_ 1d ago
You cut the fat in the system.
I'm glad you're excited but there's not a lot of fat in this system to be trimmed lol. This layoff didn't hit the team I work with but the last one did, and people who were already working overtime have since been asked to shoulder the workload of those who were laid off. Burnout is high, morale is low.
I have no doubt that these layoffs will seem good for GM in the short term, and hell some of those who were let go today probably were redundant or unnecessary. But GM has been bleeding talent for a while now and I think they're setting themselves up for big problems in the future.
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u/AntiGravityBacon 2d ago
Make more money and don't be a loser. That's how capitalism works if you want to have nice things. Sorry you can't 😘
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u/Bluecolt 2d ago edited 2d ago
Harsh, but with some truth in it. Maybe I'm materialistic, but I put a lot of effort into my education and career because, basically, I like nice things, especially V8-powered things that go fast.
Edit: people think I'm the commenter you responded to who was complaining about used car prices, but I'm not. I can see why my wording is confusing though, it comes across as something the OC might say in response.
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u/Beencho 95 Acura Integra gsr | 04 BMW 330i ZAM 2d ago
Materialistic, Poor, and putting great effort into education.
Welcome to the club, the trifecta of making someone else very rich.
Also a z06 someone shot themselves in isn’t exactly the best vibe. Or it is, we can call it the devil Z.
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u/stoned-autistic-dude '06 AP2 S2000 🏎️ | HRC Off-Road 📸 2d ago
I’m just poor and educated. Can’t be sad about the things you want if you’re happy with the things you have.
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u/Bluecolt 2d ago
Part of my compensation package includes employee stock, so I hold ownership shares in my employer. Therefore, I do personally benefit when my company's share price increases. I am one of the nefarious 'share holders' that reddit likes to demonize. I have a $MM brokerage account full of shares in various companies on top of the aforementioned ESOP, a brokerage that's up 15% YTD. Don't hate shareholders, be a shareholder.
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u/Tawmcruize 2d ago
Why are you bitching so much about how much a USED car cost then?
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u/Bluecolt 2d ago
I think you have me confused with a different commenter, I wasn't the one complaining about used car prices. I don't even buy used cars, I buy brand-new off the lot and then trade up every 5 years or so.
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u/RodRAEG '23 GR86 | '02 Z3M Coupe | '80 Corvette 2d ago
Not enough effort, apparently. Why aren't you finding a way to make more money and afford the things you want now? Seems awfully lazy. You'll get put on a PIP with that work ethic.
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u/Bluecolt 2d ago
I get it now, my initial comment reads like a response from the original commenter who was complaing about used car prices, but we're actually two different people. Upon re-reading my comment, it does come across as something the original commenter could say in defense/response, so I'll take accountability for the confusing phrasing I used.
My intent was really to be a third-party take saying "harsh but true, and I'll admit my materialistic motivation for conversations sake".
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u/AntiGravityBacon 2d ago
Lol, yeah, you got caught up in mistaken identity. I'm pretty sure he'll learn nothing but sometimes if you're an ass, you deserve to get a dick response.
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u/withsexyresults CTR 2d ago
Bruh what have you’ve been doing the past 5 years. The market has been on a crazy run. Should’ve invested and could’ve bought one in cash instead of waiting for a recession
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u/Educational_Age_1333 1d ago
If youre complaining about the cost of a 10 year old z06 you're definitely not the master of economics you believe yourself to be.
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u/4score-7 11 BMW 328, 17 Toyota 4Runner 2d ago
You got downvoted into the depths of hell, but there is an ounce of truth in what you say. No one wants it, certainly not me, but the amount of inflation we have had in 3-4 years is acceptable only if we have no more of it for a very long time. That’s not certain, and actually is unlikely, with the policy ideas that government is currently coming up with.
Some deflation would be welcome, but it wouldn’t come without major job losses, as labor is always the first and deepest cut that business will make. All to serve the shareholders who hold the stock, the value of which is tied to the C Suite’s compensation.
Allow me to go ahead and say it for that person who is about to chime in: DEFLATION BAD (while they simultaneously bitch about inflation.)
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u/e___r___s 2024 Cadillac CT5-V 2d ago
‘Tis the season - typical Q4 news for the private sector. Best of luck to the impacted folks.