John D. Stoll wrote a Dow Jones Newswire article the Wall Street Journal GM to Cut Prices on Most Models In Move Away From Incentives (subscription required).
DETROIT -- General Motors Corp. on Tuesday announced plans to slash prices on most of its models as part of an effort to better gauge what consumers are willing to pay and move away from the heavy incentives that confuse buyers and take a bite out of the auto maker's profits.
Separately, Jerome York, an adviser to investor Kirk Kerkorian, called on General Motors to cut its annual $2 a share dividend by 50%, a move he said would save GM about $566 million a year. He also pushed for a "substantial reduction" in payments to GM directors and urged pay cuts starting with top GM executives - with progressively smaller pay cuts down through the ranks, "with hopefully only a single-digit reduction necessary among the rank and file in plants and offices." Mr. Kerkorian's Tracinda Corp. is one of the auto maker's biggest investors.
There are new and different articles concerning GM almost daily. But in my view, nothing has really changed.
I have written previously that I believe price cuts and incentives will simply flow to the consumer. While GM might move more metal, it is likely to be profitless prosperity. And now we have York calling for a reduction in the dividend and pay cuts. I wonder if York wants to remain an outsider, instead of a director, because he can criticize more easily as an independent person.
I remain short GM shares.
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