If all goes according to plan at General Motors, shares of the company's stock will soon be trading once again on the New York Stock Exchange. The automaker, which declared bankruptcy in 2009 and is today 61 percent owned by the U.S. government, hopes to raise $16 billion in the second-largest IPO in U.S. history. The company is making the move after announcing a $1.3 billion second-quarter profit and a new chief executive. But, with the economy mired in a prolonged slump, critics are wondering whether now is the right time for GM to go public: (Watch a PBS report about the state of GM)
Too soon for GM, not soon enough for Obama: This offering is "earlier than what would be ideal," says automotive analyst Craig Fitzgerald, quoted by ABC News. GM is still in the earliest stages of recovery, and it seems likely that "broader political considerations" — that is, the Obama administration's desire to score a "major victory" ahead of the midterms — are to blame.
"GM's CEO steps down amidst IPO talk"
But this deal must get done: GM is right to act now, says Susan Tompor at the Detroit Free Press. "Sure, waiting for a better day could generate more money." But the government has to get GM off its books, and while the automaker is generating profits an IPO makes sense. Besides, "who knows when we'd see a better time?"
"Wrong time for GM IPO? Not necessarily"
A necessary IPO, but not yet a safe one: Going public makes sense for both GM and the government, says The Economist. The automaker can begin to "lift the stigma of government ownership," and the White House can finally portray the bailout as a success. But it's still unclear whether GM's "recovery is real and lasting." Would-be investors should proceed with "a degree of wariness." The recovery is not yet complete.
"GM prepares its getaway"
Where's the good news for non-investors? GM is profitable again, and an IPO is afoot, says Andrew Leonard at Salon. Well, pardon me if I don't crack open the champagne. All this so-called success is "not translating into an aggressive hiring spree." The automaker only added 2,000 jobs in North America this year. The only numbers that matter here are those of "employment growth," and we're not seeing them yet.
"GM makes a nice profit, but where are the jobs?"