In what would seem to be an amazing display of no confidence, six top GM execs dump their stock in the company, to a tune of $315,000.
The UK Guardian today is reporting that the six executives have sold their shares at, what the Guardian is calling, "a knockdown price of $315,000" All on the heels of GM heading into seemingly inevitable Bankruptcy. The report says.
Among those cashing out are GM's former head of product development Bob Lutz, a veteran Detroit figure who stepped aside to become a senior adviser to the company last month and who offloaded his 81,360 shares for $130,989 (£86,000).Lutz's successor, Thomas Stephens, liquidated his stock, as did North America president Troy Clarke, manufacturing chief Gary Cowger, head of European operations Carl-Peter Forster and chief information officer Ralph Szygenda.
Currently, GM is trying to persuade lenders to convert 27 billion in debt to into equity so the company can issue "billions of new shares, handing majority control of the company to the US government and to the United Auto Workers union." This deal would dilute greatly the value of existing shares that have seen a drop from 20 dollars to 1.5 dollars in a one year period.
This drop in stock price has meant the loss of a life time of savings for many white collar employees at GM. As for the top execs their sell off cost them greatly as well. The stock they sold for $315,000 would have been worth 8.6 million in October of 2007, before the financial crisis began.
In order to save money GM is thinking of moving it's head quarters from there down offices to nearby Warren, a Detroit suburb. GM has been offered tax breaks to move the head quarters there. Jim Fouts Mayor of Warren said.
"We can save General Motors if they come here and be a friendly partner," Warren's mayor, Jim Fouts, told the Detroit News. "General Motors made Warren. We would like to return the favour."
The famous among Detroit residents are rallying around the car company as well. Trying to set an example of fiscal responsibility, the newly elected mayor Dave Bing, will not move into the mayors official mayoral residence, Manoogian Mansion. The up keep for the home costs the tax payers 150,000 a year. Also lending a hand is rapper Eminem, who has promised to "fly 200 out-of-work car workers from Michigan to Los Angeles for the taping of a live performance and television show on Friday."