Toying with bankruptcy

With gas over $4 a gallon, it shouldn't be surprising tiny die-cast cars are doing better than 8,000 pound Hummers:

GM, turning 100 this year, has few options to re-inventing itself. The company reported its largest annual loss in 2007, $38.7 billion, after a tax accounting change, and hasn't had a profitable year since 2004. The carmaker's U.S. market share hovers at the lowest level since 1925, and last year GM was 3,000 cars away from being dethroned by Toyota Motor Corp. as the world's largest automaker.

The company's current market value is smaller than that of Mattel Inc., maker of Matchbox cars, and a 10th of what it was in 2000. A Merrill Lynch analyst said yesterday that a GM "bankruptcy is not impossible if the market continues to deteriorate.''

Well, when you wait to introduce your most efficient cars into the large U.S. market, you shouldn't be surprised when foreign auto manufacturers get there first with hybrids and slash your market share.

General Motors Corp., which popularized the 7,800-pound Hummer, may begin selling a mini-car more than a foot shorter than anything else it markets in the U.S. to win back buyers deterred by record fuel prices.

GM may bring the production version of the Chevrolet Beat to the U.S., people familiar with the plan said. The car, which would normally be reserved for markets such as Asia and Latin America, gets as much as 40 miles a gallon, a fuel efficiency topped in the U.S. only by hybrids.

U.S. automakers are reliving their worst days of the 1970s-1980s when they saw much of their dominance eroded by Asian imports. And they have no one to blame but themselves for failure to anticipate and adapt. I should check to see if the current CEOs of the Big Three are named Larry, Curly and Moe.