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My wild-ass-guess is that many companies can go into hibernation of some type. Furlough enough staff, take some government aid, stop wearing out tools, stop con
by peteretep 7y ago
My wild-ass-guess is that many companies can go into hibernation of some type. Furlough enough staff, take some government aid, stop wearing out tools, stop consuming raw materials. If you're a car manufacturer, for example, sure you have _some_ costs rights now with production lines stopped, but just how much?
- ardit33 7y agoThere is your answer: https://www.nasdaq.com/articles/volkswagen-is-burning-over-%242b-a-week-ceo-confirms-shares-fall-2020-03-27 https://www.nasdaq.com/articles/volkswagen-is-burning-over-%... VW, is burning 2bill a month in cash, just by sitting idle.... Furloughing can save maybe %20 of the costs. A lot of the fixed recurring costs (costs and obligations that keep going even if you are not producing anything) make at least 30% of the producing value.... So, just for VW, if it sits idle for 6 months it will cost 12 Billion dollars..... That's just one example, but there plenty of companies with the same spot. They can absorb few months of this situation, but after that all bets are off.
- peteretep 7y agoYour article is 2 weeks old, since which VW have furloughed many staff (also worth noting it's $2bn per _week_). Where do you get your minimum baseline on staff cuts only saving 20% from?