Daily Archives: July 7, 2007

GM’s (GM) Market Share Drives Off A Cliff

Edmunds writes that GM’s (GM) North American market share in the most recent month dropped to 22.1%. In 2002, during the same month, the number was 30.2%. The latest number is a record low for the company.

Odd as it may seen, the cause of the market share drop may be that the company has lowered its incentives more quickly than the competition. The company’s June 07 incentive per vehicle was $2,830. A year ago, that figure was $3,135. Toyota (TM) and Honda (HMC) both raised incentives sharply.

The information highlights GM’s "damned if you do, damned if you don’t" dilemma. The company wants to wean itself from sales to car rental agencies and offering huge incentives directly to retail customers. Both actions keep sales high, but drive up the loss-per-vehicle that is crippling profits in North America.

On the other hand, GM’s 21% drop in June unit sales shows that moving away from incentives wreaks havoc with moving inventory.

The solution, of course, is to build cars and trucks that consumers will buy. That appears to have been lost somewhere among all of the headlines.

Douglas A. McIntyre can be reached at douglasmcintyre@247wallst.com.

Posted on: July 7, 2007 – 8:25 am in Uncategorized, , ,

This Week on StockHouse July 2 – 6

The official start of summer arrived in a trading week shortened by the U.S. and Canadian national holidays.

Falcon Oil and Gas (TSX: V.FO) occupied the top Bullboard spot in this week’s Top Five (http://www.stockhouse.ca/shfn/article.asp?edtID=19920 ).

After this week’s takeover offer for copper producer Aur Resources (TSX: T.AUR), Buzz on the BullBoards reporter Sean Mason recorded the discussion on the HudBay Minerals (TSX: T.HBM) board, and found takeover talk (http://www.stockhouse.ca/shfn/article.asp?edtID=19927 ) dominated the discussion.

For the inside scoop (http://www.stockhouse.ca/shfn/article.asp?edtID=19925 ) about company meetings and conferences, look to the Horse’s Mouth, this week’s Best of the Blogs.

New columnist Matthew McCall profiled a China-based private education company (http://www.stockhouse.ca/shfn/article.asp?edtID=19912 ) that he said was a growth story with big untapped middle class expansion prospects.

For investors who want to get through summer school quickly, the Investor U column by the Investor Education Fund had a cheat sheet for SEDAR (http://www.stockhouse.ca/shfn/article.asp?edtID=19909 ), the Canadian investment document repository.

Read More »

Posted on: July 7, 2007 – 8:08 am in Uncategorized

Another Troubling Sign From Sun (SUNW)

Sun Microsystems (SUNW) had decided to add and support certain features of the Linux open source operating system in its own Solaris product.

Reuters quotes an industry expert as saying: "Solaris is hard to set up. It doesn’t have good hardware support," said Ladislav Bodnar, founder of Distrowatch.com.

The news should lead Wall St. to believe that Sun’s server sales are still being hampered by reluctance by enterprises to use Solaris. If Solaris is a barrier and Sun is being forced to add aspects of Linux to its software suite, there is a very good chance that server sales at the company are behind plan.

Sun continues to be a sort of "flavor of the month" company, adopting and creating software that it will thinks will help its market share.

Right now, that does not appear to be working.

Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com.

Posted on: July 7, 2007 – 7:26 am in Uncategorized