GM and its impact on FIRST
 

I'm sure you've all seen the stories of GM's bankruptcy and you all know how much money it has given to many clubs and to FIRST as a whole. So with Gm going under, what do you think the kickback will be on FIRST?

Re: GM and its impact on FIRST
 

I think General Motors realizes the values and importance of FIRST, and when it brings itself out of bankruptcy, it will continue to fund FIRST and subsequent teams. Sure, the amount of funds given may be substantially less, but every little counts, right?

-Nick

Re: GM and its impact on FIRST
 

GM won't bring itself out of bankruptcy.

Teams that rely on auto sponsorship may want to find companies with factories/engineering locations stateside that aren't failing, such as Subaru, and others. GM is dying, and what we're seeing is the floundering of a company trying to stay alive.

Re: GM and its impact on FIRST
 

As far as I know GM has been our teams primary sponsor since its inception. We've already been told that fundraising is going to have to be drastically increased if we want to stay around past next year, and I doubt that we're the only team in that position.

Keep in mind that GM did more than donate money. They also provided support through donation of tools, providing mentors, and other additional services.

Re: GM and its impact on FIRST
 

[partial speculation]As far as I know..And please don't quote me on this as it is not a fact yet....GM is going to be pulling out of FRC as a primary sponsor. That is just what I've heard from a reliable source.[/partial speculation]

I actually think it would be a good idea for GM to cut back on FRC teams. Yeah it will suck for GM teams, but I'd rather see that money go to keeping some jobs around. JMHO

Re: GM and its impact on FIRST
 

The difference between speculation and investment in the stock market is that you invest for the long term. That is what GM has done with FRC. FIRST provides the feedstock for GM's next generation of engineers.

GM may certainly cut back the total dollars allocated to teams; our sponsor has done the same. This forces us to alter our strategy and work on alternative funding; not a bad thing. Nothing is static; our students need to learn this lesson and see how we regroup.

But the primary commitment of providing mentors to inspire students to enter STEM careers is so central to GM's future success that I cannot see them backing away from that aspect of the program.

Re: GM and its impact on FIRST
 

Also note that mentors and tool loans are not very expensive to the company. Certainly not as expensive as cash.

It would be a good idea for every team - GM sponsored or not - to cultivate some new sponsors. They don't have to give in the 5k or even 1k range - 25 sponsors at $500 each tends to be a lot more stable than 2 sponsors at $6k. Surely there are 25 companies within 15 miles of the school...

Re: GM and its impact on FIRST
 

Hopefully, GM won't "go under". If they go into Chapter 11 bankruptcy, that means that they will reorganize. This is currently what Delphi is still doing (since 2005) and what Chrysler is doing.

I believe that Craig is very wrong, and GM will emerge from a re-organization as a much smaller company. There will be many changes along the way, making GM a different entity within 5 years.

Here's another way to look at this, from a FIRST perspective:

If any of us are in the market for a new or previously-owned vehicle, why don't we go out and purchase a car that is made by one of the companies who have supported FIRST programs for many years?

Let's see... Chrysler, GM, Ford... they have supported FIRST. Maybe we should support them, eh? I don't see Subaru, Toyota, Honda, Mercedes, BMW, or other non-US-based auto companies being major sponsors of FIRST events and foundations. In this tight economic times, I suggest we support the companies who are supporting what we are passionate about, instead of piling on and giving up on them.

Andy B.

Re: GM and its impact on FIRST
 

I'm with Andy on this one. I have GM cars in my drive and I have had them since 1984. I owned a Subaru and still feel that GM provides a superior product and it is a North American product.

Re: GM and its impact on FIRST
 

That makes a lot of sense, kind of makes me wonder though. Is there anything else that FIRST and all of its teams could do to help out GM?

Re: GM and its impact on FIRST
 

I have not seen any press releases stating that Tom Stephens has given up his seat on FIRST Board of Directors and I reflect on Tom's comments that Dean brought up during the closing cerimonies in April...
<paraphase>we have to do more of this, and faster</paraphrase>.

With Tom as a Vice-Chairman at GM and FIRST as one of GM's educational partnering organizations, I'm confident that GM's support of FIRST will continue. How it manifests itself may change, as many things are going to at GM, but I expect that the support will be there. I am a second generation GM employee and have a number of things 'at risk' in this situation, but I am certain that we will continue to see a FIRST/GM relationship as long as Tom is still in the picture.

Re: GM and its impact on FIRST
 

With the reports as to who will actually hold the value of the company, 70% will be the US government. I don't expect that they will be willing to give out money to charitables for a while. Some of the remainder is owned by union members, and their first priority must be keeping their workers working and protect those in retirement. I am not saying this to be detrimental to the unions, they have their work cut out for them and have specific responsibility to the members who pay them dues. The rest is held by people who have given money and are owed more than the company is worth. I hope the GM, Ford and Chrysler teams will be able to make it through the next few years. They may have to resort to FTC for a few seasons, but with any luck can continue and hold together until times are better.

Re: GM and its impact on FIRST
 

GM going bankrupt will hurt a lot of teams, as has been speculated.
Our story (as its the only one I am qualified to tell) is that GM has been a Great and Faithful sponsor for years. They have given us
1) money (drastically reduced over the past few years),

2) our home (a amazing amount of space for our machine shop and partial practice field, in a shop that is going to be shut down by the end of June...),

3) our Mentors (a Great bunch of people that are more like friends than teachers, even though they have taught us a huge amount of information. a dedicated group of GM engineers that have been with the team for about 10 years), and

4) just all sorts of help

I will be sad to see GM go but we will survive.

For us, we have been earning WAY more than GM has been giving us the past few years. If you ever go to the Michigan Renaissance Festival, we cook the Turkey Legs, its hot, greasy, smoky, dirty, and tiring but we earn $22,850- it is most of our budget.

It is possible to live without the Big sponsors, it just takes a lot of fund raising and hard work...

Re: GM and its impact on FIRST
 

I couldn't have said it better myself.

Any business or individual willing to support a bunch of eager high school nerds is OK by me. :p

Re: GM and its impact on FIRST
 

I think it will be a good thing if GM cuts back on monetary support for a few years. Leave the mentor support and as much facility support as you can spare from restructuring, but cut back the money drastically over about 2 years (if given that long).

The teams that don't go down will be stronger than ever. They will know how to raise money, maybe even supporting the teams that don't while they learn fundraising. raumeister and Don are dead on as to where your money can (should be) coming from. If you are dependent on one major sponsor to the point where your team will collapse if they stop funding you, you need to diversify. Small sponsors and fundraisers are the way to go. (And trust me, I took one look at that fundraiser for 68 and thought "They made THAT MUCH off one fundraiser? Why didn't I think of that one? How would I get a team into that sort of thing?")

If you can have a solid foundation even though you lose a key sponsor, you will be in for the long haul. I know that for a while, the students on my old team could fundraise more money by doing little things like car washes and "eat at X restaurant" nights than our biggest money sponsor gave us in one chunk. We've been around since 1998 (or 1997, depending how you count it), for reference. That's the kind of funding you want.

Re: GM and its impact on FIRST
 

I suspect you are quite wrong.

Are you aware that portions of subaru applied for bankruptcy in 2000, and they also applied for some of the $25 billion on auto aid loans authorized by the DOE this year?

Re: GM and its impact on FIRST
 

I personally would buy a car for far different reasons than who they gave Charity too. It's all about reliability, efficiency, weight, and performance for me, in that exact order. GM seems to have the opposite order. Yes, they have a few models that are exceptions, but the bulk of their product is heavy cars with good highway power. Americans clearly don't want that type of car, or the sales would be much better. (And yes, I understand that I'm simplifying the issues here, but this is a sponsorship debate, not a Macroeconomics discussion)

Yep, entirely aware. However, in direct comparison across every factor, Subaru is currently beating GM. Reliability: Win. Efficiency: Major win. Performance: HUGE win in handling, because America is the only one with an obsession for Drag.

I guess I'm plagued by having no customer loyalty to any brand. I'll buy the best out there for the best price, and currently no American car maker (other than Jeep) delivers what in my eyes constitutes as the best.

That being said, I in no way believe that consumers should give up on GM. If they release the volt for a reasonable price, you can bet I'd buy it if I had the money. When a company innovates, I'm all in favor. But that innovation has grown mainly stagnant due to the massive size of GM, and they're currently shedding dead weight. Once the shedding is complete, if anything emerges, the beast will be far different. I have a feeling the company that emerges will remember to cater to the consumer, rather than attempt to dictate what the consumer wants. This isn't the same type of times that Ford has gone through; and GM doesn't have a Crown Victoria to be bought in large enough quantities to keep them afloat. After all, Ford would be long gone had they not repackaged the Crown Vic as the Police Interceptor.

TL;DR - I hope GM recovers and gets back on track with sponsorship, but as things stand now I don't see them returning to the previous potency.

Re: GM and its impact on FIRST
 

I have said this before, but I think it needs repeating. Buy whatever you feel is best for you. However, if you are in the market to buy, please test drive those vehicles that have supported your programs. I am not asking you to spend money on a car you don't want, but I am asking you to evaluate your options off of experience an not pre-concieved notion, or what the car rags are telling you.
If these companies have donated time and money to a cause you find near and dear to your heart, then go check out their products and compare them fairly to their competition. What you will find is some a better, some are worse, some are better value, some are not.

Also, please be aware that GM, Ford, and Chrysler sponsor more than just teams. They have been major sponsors of awwards, regionals, and FIRST as a whole. If they are not able to contribute to FIRST as a whole, we all should be concerned.

P.S.
Car and Driver and Motor Trend are loyal to their sponsors! If there is a shoot out between several cars, I can tell you who will win based almost solely of looking at the ads in the magazine. Use your brains, not theirs when looing for a car or truck.

Re: GM and its impact on FIRST
 

Craig, where did you get the information regarding the Crown Vic 'saving' Ford? I work for Ford, and I've never once heard that bit of information.

Re: GM and its impact on FIRST
 

Just thought of something. A large portion of GM will now be owned by the government (over 50% if I'm not wrong). If that's the case and GM continues to support FIRST (in whatever way it does) then technically wouldn't that mean that the federal government would be supporting FIRST? Yes? No? I don't know just a thought. Sorry for straying off topic.

Re: GM and its impact on FIRST
 

Drifting away from the subjet of what car maker makes the best cars... I feel that we will see many FRC teams tighten their belts for this comming year, even if they aren't a GM team. I know my team (201) has been a GM team for as long as I could remember, and now that we may be losing them we are being extremely careful with our money. So careful that the participation in off season events was on the chopping block. I think we will see many of the teams that go to three or more events maybe only go to two to preserve money. Teams may do this because who knows what company will be the next to go under.

Will the level of play be lowered? Never, even if teams are competing with a fraction of their previous budget.

Just my $0.02

Re: GM and its impact on FIRST
 

<off topic rant and personal views, feel free to disregard>
Yes, you have hit the nail on the head to why I simply CANNOT purchase a GM manufactured car as long as the Federal Government owns a majority share in the company. These are deeply held beliefs in the way capitalism is supposed to work, to have a company owned by the government is something that I cannot support.* To purchase a GM car would go against many of my core beliefs should they emerge from Chapter 11 as a government owned company. I apologize if this offends any of you, it makes me sad, every GM car my family has had has served us well. When I got my first car 2 years ago I only looked at American cars and GM was number one on my list, I ended up with a Saturn, a Saturn I enjoy driving. I don't dislike GM, Ive never had anything but wonderful experiences with them. I will consider Ford for my next car purchase because I consider them the last American car company.
</rant>

While I do greatly appreciate the support from GM I personally believe that GM support for FIRST should have been among the first things shed in order to help preserve jobs. I would rather see a dozen FRC teams fail than to see one American job lost. Of course I understand that even 100 teams with $20,000 budgets would have been a drop in the bucket compared to the losses GM was taking. However, understand that often perception is more important than reality, imagine the response of a GM worker when he just got told he couldn't come in to work for the next week because it was too expensive to pay him when he sees a dozen kids using GM owned equipment to build what is essentially (to him) a glorified remote control toy. If I had to worry about how I was going to feed myself or my family so some kids can play with their toys I would be pretty ticked off. We have to be careful about what we ask for, teams will need to cut back and trim the fat out of their teams. I expect this year will be one of the slowest growing years for FIRST, most of the growth that does occur will NOT be within the United States either. Many old GM powerhouse teams will be struggling this year because some of them will have to radically change how they do things. Many other teams will struggle because their primary sponsors are suppliers to GM, Delphi springs to mind as another major sponsor here. One downfall of our current system is that everything is linked into everything else, you would think that being a software programmer I couldn't be jeopardized by a failing in the manufacturing industry but I produce systems for GM suppliers. My point is GM is huge, this will affect our everyday lives for years to come.


Sorry for the novel, now if you will excuse me I am going to put on my safety glasses ::safety:: (Why does he not have a construction helmet on too?) and ride out the comments...

*There are exceptions, obviously some things are just logical to have government run (or at least controlled) Roads, Telecommunications, Utilities are a couple that come to mind.

Re: GM and its impact on FIRST
 

I don't like the idea of GM being government owned either, but my point was a little different. I was more commenting on the fact that for a long time we've been encouraged to make our elected officials aware of FIRST by say inviting them to a regional or whatnot. I was just musing about whether that will be accomplished through the government owning GM and GM supporting FIRST. Just a thought...

Re: GM and its impact on FIRST
 

Sponsors come and go, the real impact that FIRST will see is going to be the loss of amazing mentors as GM closes plants and offices that they work at. Many of those mentors are very dedicated to FIRST but they will have to think more about their families and finding work rather then spending time working with a FIRST team. Here is Delaware the GM plant is closing affecting over 500 jobs, I can't imagine what life is like in some of the towns where the GM plant was the life's blood of the town.

Re: GM and its impact on FIRST
 

Speaking strictly from a financial standpoint, a company (such as GM) typically would get tax benefits by supporting a qualifying charity (such as a 501c3 like FIRST) to a monetary extent (it's been a year since I took tax, I don't remember off the top of my head, I'll look it up if you really want me to). To that extent, GM was able to pay fewer US tax dollars by supporting FIRST's charitable actions. Sorta like, giving them the option of doing the general good things the government wants to do, or picking which good thing they want to do. Additionally, the losses that GM has been taking for the last few years will "earn" them money in the coming years. If my memory serves me correctly, a current NOL (loss) can be applied to income as far as 20 years back, and they will receive back taxes for profitable years. (If a company hasn't been profitable in that period, or the losses outweigh past gains, it also carries forward, but I won't get into that)

Now, all of that given as truth, the bankruptcy, because of the extent of government involvement, may make some of those typical financial benefits of charitable support null. Typically (and the likely reason that Fiat bought Chrysler), a bankruptcy does not invalidate the ability to use these losses and charitable deductions, but with the billions in government aid, the media has been making it sound like this won't be your typical Ch 11 (and since they're on the conference calls, I'll trust them).

So, the point of that whole thing is: it has been in GM's best financial interest to support charities such as FIRST in the past, depending on government restrictions on charitable contributions, it may or may not be in the future

Re: GM and its impact on FIRST
 

GM will need far fewer engineers now. They have profitable trucks and other large vehicles that Obama is going to obsolete with higher mpg requirements. The Malibu will survive, everything smaller is not competitive, except maybe for rebadged imports such as the Aveo. I predict GM will become a rebadging company for far east manufacturers, if they survive beyond 8 years to a new administration - assuming Obama is reelected, and poor value for $50B of taxpayer money IMO. They could have gone bankrupt 6 months ago and saved us $50B.

Chrysler will become Fiat-Lite. Fiat just came in dead last out of 28 manufacturers in a survey of new car quality in the UK. Their mediocre cars will not sell in the US, so expect more government handouts there too. Study the 1960's and later history of Austin/Morris to see what the future holds for GM and Chrysler. Poor management, costs too high, epic fail. I had relatives that worked at Austin (later British Leyland etc.) in Longbridge UK. It was a huge site. Went there a couple of weeks ago and it's a big patch of dirt now. The so called UAW "concessions" are not serious, and who in government is qualified to run a car company? I have a really bad feeling about all of this and hope I'm dead wrong. I currently own a Cadillac and two Chryslers and it looks like they will be my last.

Sad to say but any FIRST teams that are dependent on GM money, need to find a plan B. Possibly nobody yet knows if they will be able to fund FIRST but there is a very clear risk they will not.

Re: GM and its impact on FIRST
 

Having Chrysler and GM go bankrupt 6 months ago would have been disastrous, recall for a moment all the panic and uncertainty last fall, banks were failing, Bernie Madoff had just been arrested for the largest Ponzi scheme in the world. Imagine if on top of all the chaos two of the largest companies in the country announced that they were going into Chapter 11. Now we are not much better off but people perceive we are slightly more stable, Obama has a plan (like it or not) Part of leading is limiting panic, if in the course of 3 months it is announced that not only are major banks failing, fraud on a global scale, AND 2 massive employers are going bankrupt people will panic. IF GM has to die I would much rather it die a controlled death than a massive, painful one.

Your other points only make me think [citation needed] What concessions? Who said anyone currently in the government will run the companies? Not saying you are wrong but I would like some more facts because you make some very interesting points.

Re: GM and its impact on FIRST
 

Well on a day like today, this is unexpected:

http://delphi.com/news/pressReleases/pr_2009_06_01_002/

Living in a community where Delphi and GM are two of the the largest employers, this is certainly an unusual day.

Re: GM and its impact on FIRST
 

I'm personally wondering what's going to happen to the teams sponsored almost entirely by GM. They're legendary FIRST teams... who's going to pick up the tab? Obviously I don't know their books or how much money they make doing various things (other than T3's legendary rennisance faire fund drive), but those aren't teams anyone wants to lose.

Re: GM and its impact on FIRST
 

Here's a link to today's GM press release dealing with the bankruptcy proceedings.

GM announces agreement with US Treasury and Canada Governments

For anyone who's interested in actually discussing the issue, it's important that you read the contents of this release to get an idea of what's actually happening.

Re: GM and its impact on FIRST
 

Thank You Karthik, now if someone could explain all of this in layman's terms. I fail to understand how this works, to me it appears as though GM is saying, "This is not the GM you are looking for" to its creditors. On March 31 they had $54.4 billion in consolidated debt and now they have $17 billion in consolidated debt. Now, I KNOW they didn't pay off all that debt so where did it go?

Also, if I understand this correctly those people that owned stock in GM just got the shaft

And one last question, New VEBA, what is it?

EDIT: Yes, I read the article, I am just confused by it...

Re: GM and its impact on FIRST
 

As our team has been sponsored by General Motors, I have followed GM's fortunes with a bit more than passing interest for the past six years. I will add, however, that I have followed this as an interested amateur, rather than a professional financial analyst. What I am posting here is my understanding of the situation -- which contains some truth (hopefully!) -- but can hardly be regarded as a complete and definitive explanation.

I don't know how much of the international aspect of GM's bankruptcy has been covered in the American media, however as shown in the link posted by Karthik, the Canadian and Ontario governments are also a significant part of the current process. I suspect other governments (Germany/Opel, Australia/Holden, etc.) may also be involved. GM is a BIG company, and this is not just an American story.

There have been a number of factors that have contributed to the current situation, not least of which is health care benefits owed to American employees (most Canadian health care costs are a govenment responsibility) and pension benefits owed to workers around the world.

Frankly, I have some sympathy for a company when their main financial problem stems from taking decent care of their employees. Yeah, this wasn't exactly an act of generousity (see CEO pay packages if you would like an example of that), rather the result of some very challenging labour relations. Nonetheless, I think GM has been a good corporate citizen in many ways, sponsorship of FRC being but one.

Unfortunately, it seems, that the health care and pension funds were not "fully funded". In other words, there wasn't enough money in the fund to pay out the benefits that were promised. In Canada and, I believe, the US, it is a government responsibility to establish rules surrounding private pension funds to ensure they are properly costed and funded and the government in Canada, at least, didn't do a particularly good job in this regard. So I do see that "the government" (keeping in mind that the US, Canadian and Ontario governments at least are involved in North American operations, and other governments with overseas operations) in Canada, at least, was part of the problem and should be part of the solution.

This was compounded by high fuel prices, which caused consumers to switch to more fuel efficient vehicles a year or two before GM was ready for that to happen, a crash in the stock markets -- which devalued GM's pension and health funds, AND the sub-prime mortgage mess in the USA which made it more difficult for people and companies around the world to arrange financing.... and if you can't get financing for your new Pontiac Solstice, then you might not be able to buy it. In short, GM was doing a mighty job of struggling with some serious long-term issues and obligations when it was nailed with an economic "perfect storm" hardly of its own making.

At this stage, therefore, it appears that GM is no longer able to pay all of its debts. Bankruptcy is a natural, and sensible protection for creditors (people who are owed money) to help ensure that a person or company is paid back as much of what they are owed as is possible. It also helps to ensure that people are paid back in the proper order.

By reorganizing GM will have to convince a court that this arrangement provides the maximum benefit for creditors in terms of the amount that they will likely be paid on the debt owing to them over the long term.

As Andrew points out, this means that a lot of debt "disappears". That is money that GM owes, but simply cannot pay. That sucks for the creditors, but is how bankruptcy works. It isn't a good thing but, like amputation, is sometimes neccesary. The important part is that GM will be able to pay employees (albeit under slightly different terms), service waranties, continue profitable products (GMC and Chevy trucks will ALWAYS have a market, even if it isn't as huge as it once was) and introduce new products. GM retirees and those receiving health benefits will also continue to receive benefits... although possibly at a reduced level. Yes, there will be billions of debt left unpaid... but there are also billions of dollars of debt that the new GM will pay off.

As for the shareholders, as Andrew correctly points out, they are the absolutely last priority to be paid. That is because shareholders are owners, as opposed to creditors, and is one of the risks of purchasing stock. So rather than saying that they "get the shaft", I would suggest that is simply one of the downsides of owning a business when it goes bankrupt... it doesn't matter if you own GM, or a corner store... if your company goes under, you get what is left after everyone else is paid. On the other hand, bankruptcy is actually part of a framework which protects owners from being personally liable for the debts the company owes.

That is hardly the complete story... but might help explain some of what is going on. Chrysler faced many of the same problems. Ford, I understand, was able to re-finance much of its debt prior to the sub-prime debt crisis in the USA, and also had good earnings from a strong European division, thus avoiding... or at least postponing... a day of reckoning.

My goal is to have our team find some new sponsors, to keep GMC as part of our team name in recognition of all they have done for us, and to be around to work with them when... not IF, but WHEN... they are able to support FRC once again. It may be sooner than we think.... they have some great new product coming out.

Phew... I didn't mean to type that much.

Jason

Re: GM and its impact on FIRST
 

I believe it is accounted for by "a new Debtor-in-Possession (DIP) financing of approximately $33 billion" mentioned early in the article.

Re: GM and its impact on FIRST
 

From reading the article and dozens of news reports, this is how it sounds like it'll all work: (if anyone can clarify or correct any points here, please do)

The "New GM" will buy all the assets of old GM, as well as automatically transfer all employees that aren't being laid off. The debt owed by old GM is poof, gone. How did it disappear? The US and Canadian governments, as well as UAW and select bondholders "bought" the debt for differing percentages of the "New GM". The concept of buying debt for [partial] ownership is based around the idea that if reorganized, the company would return to profitability and those which bought the debt would now own a profitable company, which can be used to pay off the debt they incurred. As such, the old GM stock is now poof, gone as well.

The US Feds don't want to own GM forever, and are seeking to begin selling off their share of the company in a few years as soon as "new GM" returns to profitability to regain the money they lost in "buying" the debt.

Sacrifices will have to be made to enable the company to balance its books, and they will close more plants, lay off more employees, and seek reductions in benefits. These are crucial in order to allow the company to return to profitability.

However, despite all of this, there should be no negative impacts on consumers. GM has dedicated themselves to their customers, current and future, and will honor all warranties, etc. They will also continue to pay all employees through the reorganization period.

Re: GM and its impact on FIRST
 

Does anyone ever really *WANT* to lose any FRC team? In this discussion, I think we should be careful not to accidentally tread upon the ashes or smoldering embers of any struggling or previously-folded teams who might not be of the same level of recognition as some the more widely-known GM teams. It is always disappointing when teams lose any financial and/or human support. Many teams have faced the same or worse challenges and have managed to adjust, quietly.

These GM teams are filled with a bunch of skilled, creative, intelligent people who truly care about FIRST. I expect most of their teams will find ways to adapt to any changes that are thrown at them and survive in some form. Some have most likely been proactive enough to have already enacted plans to diversify their mentor and sponsorship bases prior to this bankruptcy announcement.

With facilities closing, merging, idling, etc., it will be difficult for every FRC team under the GM umbrella to survive. Delphi has been playing the bankruptcy game for four years now. A few of our teams have folded during that time. Funding levels for most team have been reduced (and truthfully, they were in decline for many years prior to our bankruptcy in 2005). Many, many key mentors have also been displaced from their jobs, making it especially tough for those affected teams to adapt. BUT, it is important to note, the majority HAVE survived. Teams have accepted the reasoning behind the reduced funding and have adapted without complaint. Delphi thankfully continues to provide some level of support to its teams and is still supportive of its employees and their volunteer efforts.

It would be nice to think that GM will follow a similar path as Delphi here, but it remains to be seen how GM (or the government) will address its FIRST team sponsorships. Regardless of their decisions, it is logical to believe that GM teams will face many challenges in the coming months similar to those which Delphi teams have been facing. If GM elects to cut the majority of funding to teams, it is possible that a few may no longer be able to sustain operations as a result. Those who have depended upon a single large funding and/or mentorship source and have made no plans to diversify prior to now will be especially under a lot of pressure to reinvent their operations in a short amount of time. It will be unfortunate if some teams fail to adapt, but the FIRST community must be ready to accept the real chance this might occur, and it might begin to talk about how it can best be proactive in helping with the "transformation plan" of any and all teams who may be about to enter such unusual, unfamilar, and difficult situations.

Re: GM and its impact on FIRST
 

I think Art pretty much nailed the gist right there. The exchange of debt for ownership stake is the core concept.

Re: GM and its impact on FIRST
 

Thank You Jason, Alan, and Arthur. I think I better understand what is going on now.

Re: GM and its impact on FIRST
 

Re: GM and its impact on FIRST
 

I drove by the local Chevy dealership today, it was empty. The owner also has several other dealerships in town, they apparently moved everything to their other GM dealership and consolidated.

It was a shock...

Re: GM and its impact on FIRST
 

I've lived in the shadow of NY City for too long. I agree, there are some places where the above it far from true.
Test-drive their products if you're in the market. Convince others to do so.
Well, either they will learn how to fundraise or they will disappear.

The point of the first quote above is that teams need to open their eyes and look around town. There are a LOT of small businesses out there, and even a $50 sponsor is better than nothing. A team with one or two sponsors is at a disadvantage, in that they have had little practice in fundraising. But, this can be learned and done, thousands of teams have done it already.

Fact: You can earn over $2000 from a car wash.
Fact: A team can do pretty well on $10k per year, if they try.

The loss of a major sponsor does not have to be a death blow. FIRST teams tend to be creative in many ways, right? Here's another great opportunity for learning.

Re: GM and its impact on FIRST
 

The subject of GM product came up (and seems to come up with every discussion of GM's woes). Of note:

-For all the talk about low-mileage trucks and SUVs, there are always going to be people that actually need the capabilities of a truck or SUV. No administration is going to restrict them out of existence. (For those keeping score, GM currently has the lead on full-size truck fuel economy with the Silverado/Sierra Hybrid at 21/22 city/highway. Excluding hybrids, Ford and GM are currently tied for the lead at 15/21 to Dodge's 14/20 and Toyota's 15/19.)

-I've driven plenty of early-decade GM models at work. Their modern counterparts are universally more refined, more powerful, more efficient vehicles--vehicles designed (if not manufactured) before GM started to accept government loans. Keep that in mind.

Last week, I signed the papers to buy a gently-used 2009 Pontiac Vibe. I bought it because it had the features I wanted (huge room, better fuel economy than my CR-V, good feel on the road, decently equipped) at a price I was willing to pay (albeit one assisted by an employee discount). I picked up on the Vibe after driving several at work, along with hundreds of other cars from just about every volume manufacturer. If car buyers did their homework--talking to owners, reading reviews, taking test drives, weighing their options--then I think the issue of GM's support of FIRST would work itself out. It might shrink relative to years past, it might grow. We should know well before Kickoff.

Re: GM and its impact on FIRST
 

What the impact of GM's bankruptcy on FIRST?

Well, it is pretty apparent FIRST cannot continue to operate at its current rate for much longer. As an organization deeply rooted in corporate dependencies, FIRST cannot ignore the actions of its (and its teams) benefactors. Thousands of dollars per event is simply too much.


I've heard nothing but praise for the 2009 Michigan district event model. The continuation and spread of this seems like a piece of puzzle for FIRST's sustainability.

Re: GM and its impact on FIRST
 

It really bothers me when people are convinced that they know "facts" when they are not true. For example, your "Major win" in efficiency is flat out wrong. In comparable models, the Subaru Legacy fuel economy rating was 20/26 MPG city/highway while the Chevy Malibu/Pontiac G6 is 22/30.

As far as reliability goes, the MSN reliability rating for the Subaru was 8.3 while the Malibu got a 7.9. The rating from Edmunds had the Subaru at 7.3 with the Malibu at 7.5. I would say no statistically significant advantage.

What bothers me about this whole deal is that so many people are spouting "facts" that aren't true that people are starting to believe them. I heard an interview with someone the other day that said, "the reason I bought a VW is because they just have better fuel economy than American cars." CHECK THE FACTS: THAT IS NOT TRUE. As a company average, that is true simply because VW doesn't make trucks. Compare models in the same class and most of the American cars are better than VW for fuel economy (still using midsize cars, the Passat 2.0L 4 cyl gets 19/29 - less than the Malibu/G6 mentioned above which has a 2.4L 4 cyl).

I just don't understand how the buying public gets duped into thinking these things without checking the facts and doing any research.

By the way, feel free to check the numbers yourself at: http://www.fueleconomy.gov/feg/byclass.htm

Re: GM and its impact on FIRST
 

From experience I can tell you that it's because it's quicker and easier to just believe what people tell you than to look it up for yourself.

And with GM shrinking from the picture a little that model likely won't go anywhere. We were told that one of the advantages of the state competition model is that the competitions are significantly cheaper than the regional that our team used to participate in. With a lot of teams funding drying up with GM's chapter 11 bankruptcy the FIRST in Michigan people wouldn't return to a more expensive system when it would mean that potentially massive numbers of teams couldn't compete.

Re: GM and its impact on FIRST
 

I hear ya man. In general the public is lazy, doesn't confirm/double check resources, doesn't bother to understand what statistics are really reporting, and tends to believe what they want to believe based on preconceived notions and internalized bias.

In a culture that all too often gets annoyed when it can't stop at a convenience store for fuel, custom order a deli sandwich, pour a coffee to individual taste, pay for it all, and be on the road inside of five minutes it would seem we've gotten far better at "spouting off" than we have at really taking the time to do our homework.

Re: GM and its impact on FIRST
 

Are you suggesting that GM's sponsorship is the primary reason for the district competition model to exist? I can't quite figure out what you're trying to say here. For Dean's vision of explosive growth in FRC to be possible, we're definitely going to need a lot more competition events, and I'd say spreading the district idea to additional regions is the only concept likely to work right now. There's a lot of logistical headache involved in figuring out what districts would be reasonable, of course.

Re: GM and its impact on FIRST
 

Alan,
I do not draw the conclusion you got at all from Mr. Pockets. I don't see how you got to his suggestion that GM funding drying up is THE PRIMARY reason for FIM. I think a lot of people are in agreement that the district model would benefit FIRST and FIRSTs individual teams greatly. Like you said though, there are a lot of logistical headaches involved in figuring out which "districts" will come to fruition.

Brando

Re: GM and its impact on FIRST
 

This is the part that implies that the success of GM is intertwined with the success of the District model.

Re: GM and its impact on FIRST
 

well i would say it IS intertwined in some way shape or form...however i don't get from that statement "the rebuild of GM is the reason that FIM will continue." I think a lot of people view FIM as a very succesful program and the future of FIRST.

Re: GM and its impact on FIRST
 

I didn't mean to make it so confusing. My point was that a very large number of Michigan teams got money from GM. They will no longer be getting, or at least not be getting as much money from GM as a result of their chapter 11 bankruptcy. As a result a great number of teams in Michigan will likely be stretched for cash in the coming year while they adapt to the change.

The FIM setup reduced the cost of events for the teams in Michigan. For example, with district events normally only an hour or two away teams save immense amounts of money on travel, lodging (or more correctly not needing lodging).

Without GM funding a good number of teams will not have as much money as they are accustomed to. In such a condition it would make no sense for them to discontinue the district system. The district system saved the teams involved a lot of money and it wouldn't be logical of them to cancel that in a time when a lot of teams will be short on cash. It wouldn't be good timing at all.

I didn't mean to imply that GM was the driving force behind FIM. I only meant that their departure would make it a bad time to stop the district system (and I'm not implying that it should be stopped at all, I think that it was a success as well).

Hopefully I didn't slaughter that point too ^_^

Re: GM and its impact on FIRST
 

You raise a good point but as far as we know GM has not come out and said they will no longer be supporting this program. Delphi continues to sponsor many teams and support this program despite having been in Chapter 11 for the last several years. I have not seen any reports from FIRST or GM that they would be discontinuing (or even cutting back) support for teams. (If I am mistaken someone please correct me, as always)

Re: GM and its impact on FIRST
 

I didn't realize that. The impression that I got from our team meetings was that we would no longer be getting money from GM. I may have misinterpreted that information however. If that is the case then my point is kind of null and void.

Re: GM and its impact on FIRST
 

Hardly null and void, teams SHOULD diversify their funding sources and look for places to trim fat, this is just good management.

Re: GM and its impact on FIRST
 

Oh! I think I misread your point completely the first time. You said the model "won't go anywhere." That can describe two totally different things. I read it as meaning it was a failed experiment and will not be used again (because it depends on GM's support), while you probably meant it will not disappear (because teams with less funding from GM would want cheaper events).

Re: GM and its impact on FIRST
 

Huh, I never would have caught the double meaning.

Let's go eat Grandpa.:yikes:

Be careful. Punctuation can be a killer....

Re: GM and its impact on FIRST
 

Actually, it would mean that most of us would have to cut back on how many events we go to per year.

For Example:
(im just picking the first teams that come to mind)

217 went to: 5 events (1 Regional, Nationals, State Championships, and 2 districts
67 went to: 5 events (3 districts, State Championships, and Nationals)
68 (us) went to: 5 events (3 districts, State Championships, and Nationals)
247 went to: 5 events (3 districts, State Championships, and Nationals)

the cost for the 5 events totaled around 5K for 2 districts, $200 for another, 4K for State Championships, and 5K for Nationals...

that is $14,200 in registration fees folks... that does not cover hotel, food, or travel...

we can cut back, it was fun with each of those teams averaging around 85 matches in the season; we may not like it but that is a lot of cash that most of us can't afford...

Re: GM and its impact on FIRST
 

That's a good point...but I don't quite understand how that correlates to my point.

If it is regarding the costs of regionals and districts I found a bit of information here: http://www.usfirst.org/community/frc/content.aspx?id=454. You are right that teams might have to cut back on spending, but that doesn't mean that it would make sense for FIM to cancel the district system, which provides two districts plus an extra competition (states) for the same price as two regionals.

So I don't really understand where we disagree.

Re: GM and its impact on FIRST
 

Is that it? :p
We paid 19k in registration fees each year the past two years. The cost of attending 5 events for 14,200 is worth it for you folks, and I cant see how those teams would stop what they were doing regardless.

Re: GM and its impact on FIRST
 

http://jalopnik.com/5299918/lexus-po...quality-survey

Some big surprises in the Quality game this year. IQS is an intial quality metric that JD Powers reports on. This is one of the best measures of build quality, and design quality (many of the quality metrics are design issues). while the luxury brands are still on average better than the everyman cars, please note the extremely small delta on the volume guys. Honda 99, Toyota 101, Ford 102, Chevrolet 103..... All of these better than the industry average of 108.

(these are issues per 100 cars or PP100).

Re: GM and its impact on FIRST
 

Probably falling a bit too far off the original topic here, but the NYTimes published an interesting interactive map depicting where our various North American vehicles' major parts are sourced from and where they are final assembled.

http://www.nytimes.com/interactive/2...-plants-4.html

Re: GM and its impact on FIRST
 

That's a pretty cool interactive map.

One thing that I don't understand about the media during this recession, is that all of the coverage centers around where the vehicles are "made" (i.e. assembled). That's fine and dandy, but what about the real high-paying jobs? What about the statistics on where the vehicles are designed, engineered, planned, parts-purchased, marketed, etc.? Since this is an engineering-based forum, I just wanted to point out that this is never mentioned.

For the company that I used to work at (I'm not an engineer anymore, btw - but that might change in the near future), for every one blue-collar job at a plant, there were about 4 white-collar jobs. In other words, if for some reason supporting American workers enters you thought process, keep in mind that while you may be supporting a factory worker at a Toyota plant, you're supporting a factory worker plus 3 engineers and designer at Ford (not to mention the share holders).

Re: GM and its impact on FIRST
 

After reading and hearing all of the concerns for GM, Delphi and others in the automotive industry................this is truly a tough post to respond to as far as mentorship, sponsorship, and corporate support as it ties to FIRST.
Buying a car that directly/indirectly supports the corporate entities that in turn supports FIRST is a touchy situation for some, as I would imagine.

People buy cars for their own personal reasons, and I would assume a big decision due to cost. For me, its the second largest purchase I've made next to a house. Its the same scenario here in Hawaii where everything is expensive and we are always encouraged by our State to buy Hawaii before anything and anywhere else.
Its pretty difficult to do for many as they buy things from the mainland USA instead when its a lot cheaper (including freight costs).

Ultimately, I personally feel that if GM is going to survive, it cant be because we are trying to save jobs and the US Car industry. It has to be a whole lot more if someones going to spend that much on something.

My .02.

Re: GM and its impact on FIRST
 

You are completely right. I just want to clarify my previous post. In NO WAY am I endorsing buying American cars to save American workers. I was just pointing out that IF YOU base YOUR decisions on things like that, then just keep in mind that there are a lot more workers than just those in the factories.

Re: GM and its impact on FIRST
 

I think that sort of thing frequently doesn't enter into the discussion because of our culture's 'war' on intellectualism. When it isn't possible to discredit someone's expertise or experience, we aim to instead discount it by making it seem like the people involved are different -- usually by characterizing them as smug, superior or out of touch with the everyman.

I think there's an impression that white-collar workers will have a less challenging time rebounding from losing their job and adapting to a new field than a blue-collar worker may. Consequently, if people consider that such white-collar workers make up 75% of those affected by the collapse of these companies, they may be less sympathetic to saving them and all that entails.