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Warren Buffett invests $256.6 million in GM
General Motors was bailed out by the US government in 2009 and the treasury still owns about 500 million shares three years after the $49.5 million bailout. However, the company is performing well in countries like China earning them a profit of $3.2 billion and $30 in revenue.
An expert commented on the investment by Buffett: "Our perspective is that the company had made real progress, but the market hasn't given them as much credit for that as it might. We have to balance maximizing recovery for the taxpayers with the speed of exit.”
GM had recently cut the spending on Facebook ads stating that it was ineffective and would save the $10 million it spent on paid advertising on social media. The move by GM had come at a time when Facebook was scheduled to go through an initial public offering (IPO).
GM is the third largest advertiser in the United States spends about $40 million to maintain all aspects of its Facebook marketing -- including about $10 million on paid ads. The automaker began to reconsider advertising on Facebook earlier this year.
A spokesperson for GM had said: "We regularly review our overall media spend and make adjustments as needed. This happens as a regular course of business and it's not unusual for us to move our spending around various media outlets -- especially with the growth of multiple social and digital media outlets.
He added: “In terms of Facebook specifically, while we currently do not plan to continue with advertising, we remain committed to an aggressive content strategy through all of our products and brands, as it continues to be a very effective tool for engaging with our customers."
GM was the fourth highest spending company, to be only behind Procter & Gamble Co., Unilever and L' Oréal on global advertising in 2010 costing $2.8 billion in the United States and $3.9 billion globally. Facebook refused to comment on the automaker's move.
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