GM is NOT using U.S. Government Loans to Invest in Brazil - Who do we believe?

[1776Forever]

I thought this was important to post as I had even sent an email to Vice President Biden Middle Class Task Force about it because I was so outraged that GM had been reported to have given 1B to Brazil out of the Bailout Tax Payer Money:

GM Using Bail Out Money to Invest in Brazil?
Submitted by Robert Oak on Tue, 01/20/2009

http://www.economicpopulist.org/?q=content/gm-using-bail-out-money-invest-brazil

Update: The quoted paper is the Latin American Herald Tribune. But there is a comment left by a supposed GM representative here which I highlight:

GM is NOT using U.S. Government Loans to Invest in Brazil

Re: Robert Oak's post on 1/19/09, "GM using Bail Out Money to Invest in Brazil"...The claims that General Motors is planning to invest $1 billion of U.S. federal aid money in its Brazilian operations is unequivocally wrong and without any basis in fact. No monies from a U.S. government loan would be allocated to investments in Brazil. In the case of Brazil, GM has $1 billion in investments that have been announced over the last two years. These investments are fully financed by GM's Brazilian operations through local sources. GM's operations in Brazil are fully self-funded.

Laura Toole
GM Latin America, Africa, Middle East Communications

I think it's very important to be accurate on such an obviously bombshell story so I will update this as I get more information. In the interim, below is the original post (can be viewed at the above link).

U.S. taxpayer money. All of that talk about workers, demanding the UAW give up concessions and this is what GM is doing with the money!

............

If anyone has different information on this please post it. I hope President Obama's task force checks this out!

[Jackpine Radical]

1. I was pretty upset by that story when it first came out, and posted about my feelings.

I remember I got stomped on pretty hard by someone who had better information back then--or seemed to, anyway--so I've had that story in my "Possibly apocryphal" file ever since.

That's the interesting thing about this board. For every controversial question, there are 7 or 8 people with the answer. 2 or 3 of them may actually have thw right answer. The problem is sorting out who is who.

[1776Forever]

3. Who is telling the truth? I think it is up to the Task Force President Obama is forming to find out

GM built the Brazil business in January 1925! Who would have ever known that?

Here is more on it:

http://www.gm.com/corporate/about/global_operations/south_america/braz.jsp

General Motors do Brasil Ltda.
Chevrolet

Brazil
Overview

Established in January 1925, GM do Brasil is the largest GM subsidiary in South America and the third largest in the world. GM Brasil's headquarters are in São Caetano do Sul where the administration, technological center, engineering center and manufacturing facilities are located. Vehicle assembly, plus engine and transmission manufacturing facilities are in São José dos Campos. The Mogi das Cruzes Complex has manufacturing and parts distribution facilities. In the state of Rio Grande do Sul, GM has a vehicle assembly facility in the city of Gravataí. A parts distribution and warehouse are located in Sorocaba and a proving ground is in Indaiatuba, both in the state of São Paulo. GMAC has headquarters in São Paulo and handles finance activities, including credit and leasing.

.........

This layoff information was posted on SocialistWorker.com site in Jan. ;09:

Taking on GM in Brazil

http://socialistworker.org/2009/01/26/taking-on-gm-in-brazil

January 26, 2009

After General Motors laid off more than 800 workers at a key assembly plant in the industrial city of São José dos Campos, the workers' union responded with an immediate work stoppage--and is now mobilizing to defend those jobs.

......

That even though this article say Brazil's GM sales were up 30% in January:

GM's Brazil Sales Cause for Optimism

by: The Good News Economist
February 12, 2009

http://seekingalpha.com/article/120163-gm-s-brazil-sales-cause-for-optimism

GM Brazilian sales jump 30% in January

You many have seen a glimmer of hope for GM in an otherwise gloomy "Q4 2008 Global Sales Call Transcript."

GM reported there that they are finding some growth success in 26 targeted "emerging markets." In these global markets, GM has a 12% market share, but in 16 of 26 of them they either held share or gained in 2008.

Particularly noteworthy in 2008 over 2007: Brazilian GM sales was up 10%. Russian sales up 30%. And sales in India up 9%. On sales of 1,090,000 vehicles, Chinese sales were up 30%.

In an article for ValeParaibano, the city's daily newspaper, Vivaldo Moreira Araújo, regional director of the Metalworkers Union and a leader in the militant Conlutas labor federation, puts GM's attacks in the context of the world economic crisis.

.......

Michael Moore even got into the act with this article posted on his site that says the President of GM says the money was coming from the Bailout Money:

February 2nd, 2009 7:17 pm
General Motors to Invest $1 Billion in Brazil Operations -- Money to Come from U.S. Rescue Program
By Russ Dallen / Latin American Herald Tribune

http://www.michaelmoore.com/words/latestnews/index.php?id=13325

SAO PAULO -- General Motors plans to invest $1 billion in Brazil to avoid the kind of problems the U.S. automaker is facing in its home market, said the beleaguered car maker.

According to the president of GM Brazil-Mercosur, Jaime Ardila, the funding will come from the package of financial aid that the manufacturer will receive from the U.S. government and will be used to "complete the renovation of the line of products up to 2012."

.........

So who the H do you believe? I think it is up to the U.S. Government Task Force that President Obama is setting up to find the truth here!

"It wouldn't be logical to withdraw the investment from where we're growing, and our goal is to protect investments in emerging markets," he said in a statement published by the business daily Gazeta Mercantil.

[liberal N proud]

2. Just like the banks saying the money for bonuses was from different source

If they have this money to invest, why are they not using it to keep the business solvent.

I know there are tax laws and provisions for how money within corporations can be allocated. But some of the rational used to explain how a company can ask for government help with one hand while they are spending money from the other baffles me.

If the bathtub has two drains but all the stoppers are at one drain, wouldn't you move one of the stoppers to the other drain to prevent all the water from running down the drain?