US begins GM bankruptcy planning

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Netto Azure

Netto Azure

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US begins GM bankruptcy planning

General Motors and the US Treasury have improved the offer to GM's bondholders, as they prepare for the firm's move into bankruptcy protection.
Bondholders with $27bn (£17bn) of GM debt are now being offered the option to buy an extra 15% of GM shares as part of a proposed bankruptcy deal.
This is on top of the 10% they had previously been offered.
If bondholders back the new offer, it will allow GM to exit bankruptcy protection more quickly.
The US car giant is expected to apply for bankruptcy protection by 1 June.
GM said it had already secured the backing for the new offer from bondholders representing 20% of the bond debt.
Under its plans to reorganizing its share base, the US government will take a 72.5% stake.
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Well...I guess Ford was very lucky in implementing their turn-around plan a year before everything went down the drain. D:

But it's sad to see such venerable (but heavily mismanaged) companies go through this...
 
Hopefully they won't give them a bailout they'll probably just blow it on one big party like AIG
 
GM enters bankruptcy protection

Car giant General Motors (GM) has filed for bankruptcy protection, marking the biggest failure of an industrial company in US history.

The widely expected move comes after GM had seen its losses widen following a steep fall in sales in recent years.

The move into bankruptcy protection has been backed by the US government, which is now expected to take a 60% stake in the company.

The White House is also going to put another $30bn (£18.5bn) into GM.

President Barack Obama described the move as "tough" but said it was "also fair" and added it would "give this iconic American company a chance to rise again".

He said that the US government, which will own 60% of the carmaker, would be a "reluctant shareholder" and that he had no interest in running it.

As part of the plan, President Obama said that the share of GM cars sold in the US that had been made in the US would rise for the first time in 30 years.
GM, which had already received $20bn of emergency loans since the end of last year, said in its bankruptcy filing that its current debts total $173bn.

US Chapter 11 bankruptcy protection gives an American company time to restructure its finances while being protected from its creditors.
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Well let's just hope they'll make cars that the American People will buy and is attuned to the green economy.
 
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well let's just hope they'll make cars that the American People will buy and is attuned to the green economy.
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Good luck with that considering most Americans who use to only buy "american made" are gradually adopting to buying Prius and Civic Hybrids.
 
People aren't going to buy the little bitty cars I've seen being proposed. A family that has more than one or two kids needs a larger vehicle if these kids are active in any kind of fashion with sports, music, or anything of that sort. Having more than one vehicle is:

1. Expensive, and

2. Inefficient.

People in rural areas get screwed over rather badly here, as well. My area is dependent on the gold mines, and if you don't have a diesel truck or some kind of large vehicle to haul stuff, you find yourself severely gimped and unable to really do your job.
 
The bright spot: race team owner Roger Penske picked up Saturn, so at least the jobs for that will stay in the US.
 
Also... Chevy is still coming out with some new models later this year.
 
Leaner GM emerges from bankruptcy

General Motors (GM) says it has emerged from bankruptcy protection after creating a "new GM" made up of the carmaker's best assets.

GM chief executive Fritz Henderson said it was the beginning of a "new era".

The leaner GM will own four key brands including Cadillac and will be 61% owned by the US government.

Mr Henderson said negotiations were continuing "around the clock" to conclude a deal to sell GM Europe, which includes Opel and Vauxhall.

Mr Henderson said that GM would take the "intensity, decisiveness and speed" of the bankruptcy process and apply it to the new company.

"We will be profitable, we will repay our loans as soon as possible and our cars and trucks will be among the best in the world," he said.

A smaller GM is being created with a reduced workforce, smaller dealer network and less debt.
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Well at least it lives. @_@
 
I hope that the new GM does well (so long as it's not as good as Toyota!)
 
I'm concerned that, if they don't sell a lot of cars really quickly, the American Taxpayers will not get their money back.
 
Arcane Mind said:
I'm concerned that, if they don't sell a lot of cars really quickly, the American Taxpayers will not get their money back.
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It's not about the speed, but the profitabilty of the business. They should be in a hurry to make a profit, but not necessarily to have market dominance. Profitibility would allow them to focus more long-term and keep their business around.

Of course, this is really moot anyways. I know lots of people who won't buy cars from GM or Crystler after all of this because they don't want to support the government-restructured process.
 
Maybe where live, but I've seen polls suggesting the majority of people across the country are considering buying GM and Chrysler because of the government's involvement. They may not agree with the process, but they want to see what they've gotten for it.
 
The Big Al said:
Maybe where live, but I've seen polls suggesting the majority of people across the country are considering buying GM and Chrysler because of the government's involvement. They may not agree with the process, but they want to see what they've gotten for it.
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Okay then. Can you show me some of these polls? Just curious, because everything I've seen shows that less people are willing to support this plan. I live in Ohio too, which is a pretty diversified state in all sorts of types of backgrounds.
 
They were taken as GM entered bankruptcy in the newspaper. I wasn't talking about supporting the plan. People flat out opposed it. It was just people more willing to look at the cars. This has put GM back on people's lips and most people won't cut off their nose to spite their face. We'll have to see if interest turns into sales, however.

As for where you live. I'm not surprised Ohio wouldn't support Michigan companies.
 
The Big Al said:
They were taken as GM entered bankruptcy in the newspaper. I wasn't talking about supporting the plan. People flat out opposed it. It was just people more willing to look at the cars. This has put GM back on people's lips and most people won't cut off their nose to spite their face. We'll have to see if interest turns into sales, however.

As for where you live. I'm not surprised Ohio wouldn't support Michigan companies.
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Well, I didn't see any support from anything I was reading, not just the Ohio stuff. I will admit that Ohio has a ... a thing for Michigan. I was just remarking that since Ohio has such a diverse range of backgrounds and political settings, it makes a good testing ground (don't believe me? There are areas here that wouldn't feel out of place in the South. There are western areas here. There are lots of suburbs and countryside areas. Not to mention that Ohio is always the swing-state of the electoral College in terms of politics.).
 
They're still united in their problem with Michigan. That colors the results.

And, again, I'm talking about interest and willingness to buy, not support for the program. Believe it or not, there are people smart enough to not cut off their nose to spite their face.
 
The Big Al said:
They're still united in their problem with Michigan. That colors the results.

And, again, I'm talking about interest and willingness to buy, not support for the program. Believe it or not, there are people smart enough to not cut off their nose to spite their face.
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You'd be surprised about the dissent among Michigan haters here. There's a big chunk of people here who came from Michigan, or who went to Michigan University or something.

I don't get the metaphore there. Can you please explain it differently? And could I please see some of these polls you're talking about?
 
I don't understand what you mean by "cut off their nose to spite their face", but people will buy what works for them. If GM and Chrysler don't produce cars that people want, interest will fade quickly.
 
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