Himanshu Patel
Himanshu Patel
european high markets material prices pricing provide raw remains tire truck weak
While tire pricing remains strong, high raw material prices and potentially weak high-margin markets (North American and European replacement truck tire markets) could provide offsets.
beyond company cost details extent favorable goals guidance limited material offered performance plant savings specific structural timing
Beyond guidance for favorable structural cost performance in 2006, and details on material cost savings goals, no specific guidance on the extent or cadence of structural cost savings was given. In addition, the company offered only limited details on the timing of plant actions.
assuming cent estimate hit lost note overtime plants production running variable via
Assuming $8,000 variable contribution margin/unit, we estimate this translates into an earnings-per-share hit of 1 cent for every day of lost production. However, we also note that much of this lost production could be made up via overtime production once the plants are up and running again.
avoiding further interest labor likely points resolution sale sticking
One of the likely sticking points in the pending sale of GMAC may well be resolution on Delphi, further emphasizing GM's interest in avoiding a labor dispute.
although becoming ford north pace production upbeat worry
Although we are becoming more upbeat on the pace of restructuring, we worry about Ford North American production outlook, particularly in 2007.
although believe demise further move sentiment speed toward
Although such a move has been rumored for some time, we believe the speed of Dana's demise will nonetheless further dampen sentiment toward the sector.
although auto demise further move sentiment speed toward
Although such a move has been rumored for some time, the speed of Dana?s demise will further dampen sentiment toward the auto industry.
bringing cap caps forcing forth gm inflation issue management similar suggest talks top
By forcing a health-care inflation cap for salaried workers, GM is bringing forth the issue of similar caps for hourly workers, which our talks with (GM) management suggest is a top priority.
diesel european production slowing weigh western worries
However, near-term worries on slowing diesel penetration and Western European production could weigh on the stock.
aggressive continue cycle due favour ford gm product
That said, we continue to favour GM over Ford due to the former's more favourable 2006 product cycle and its more aggressive restructuring approach.
aggressive continue cycle due favor favorable ford gm product
That said, we continue to favor GM over Ford due to the former's more favorable 2006 product cycle and its more aggressive restructuring approach.
belief company cost earnings heightens likely meaningful reassure rebound targets
The company's specificity on 2006 cost targets ... is likely to reassure the market, and heightens our belief that the company will see a meaningful earnings rebound in 2006.
came difficult earnings gauge guidance impact isolate provide
The company's announcement that it will not provide earnings guidance going forward, however, came as more of a surprise, making it notably more difficult to isolate and gauge the impact of restructuring.
likely management market parameters putting
The market is likely to be reassured that management is now putting firmer parameters around 2006 performance.