GM's Wacky Sales with Partial Recourse

Over the past few weeks, government-controlled auto maker GM has been running a somewhat bizarre commercial on cable television.

A blue-collar line worker smilingly tells the viewer that GM is such a friendly, gentle industrial company that even if the purchaser of a GM vehicle loses his/her job, the firm will forgive a generous amount (I think it is up to $500) of the buyer's monthly payment for, again I believe, six months.

The GM worker extols the company's kinder, softer new image that cares so much for their customers.

To me, the commercial showcases so much of what is wrong with GM. Desperate to sell cars, they are now getting involved with dodgy buyers, assuming recourse on the loans and entangling themselves in the financial instability of others.

This is precisely the sort of nonsense that you get when the federal government meddles in the private sector. If I'm not mistaken, the feds have also become the ultimate guarantor of GM warranties.

How about GM just trying to sell cars straight up, as is, with no special financial incentives? Shouldn't we get a sense of whether anyone actually wants the firm's cars, and at what prices?

Heaven's knows how much more liability the firm is now incurring by promising payment relief to customers who may lose their jobs in the next year or so. It's hardly a model for a near-dead firm to employ in order to stagger back to life.