I guess the new government-run GM ascribes to the business philosophy “they zig, we zag”:
Even with the labor savings, analysts question the logic of building a compact car in the U.S. Margins are so tight that even Toyota and Honda have opted to build their smallest models in countries with lower labor costs. “Virtually nobody makes cars that size in the U.S.,” said CSM Worldwide automotive analyst Michael Robinet. “There is a reason why GM at the outset was going to bring this car in from China.”
Estimates peg GM’s losses on U.S.-built small cars at roughly $1,000 to $2,000 per vehicle sold in recent years. Lawmakers and congressional staffers involved in the compact-car competition said GM acknowledged the company expected to struggle to break even on the venture. GM views small cars as central to its bid to become what Mr. Clarke called “the greenest car company in the world.”
Does anyone expect taxpayers will ever see their investment returned?
