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GM may file Ch 11, create new company, or needs more aid

M

MikeMike

Lifer
http://online.wsj.com/article_...DI5MzE0NTUxODU2Wj.html

Treasury Department officials believe GM needs at least $5 billion more in U.S. loans to keep operating beyond the first quarter, said people familiar with the situation.

The call for additional funds will be a key part of the revitalization plan GM is required to file with the Treasury by Tuesday, though it is unclear whether GM will furnish a dollar amount, said people familiar with the matter. The plan is supposed to describe how the company will become self-sustaining and better compete with foreign rivals.
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Interesting. I know that Ch. 11 could cause some MAJOR issues, but i do also see it as an alternative... it allows them to destroy saab, hummer, saturn. But at the same time, wtf will they call this new company?
 
Originally posted by: MIKEMIKE
http://online.wsj.com/article_...DI5MzE0NTUxODU2Wj.html

Treasury Department officials believe GM needs at least $5 billion more in U.S. loans to keep operating beyond the first quarter, said people familiar with the situation.

The call for additional funds will be a key part of the revitalization plan GM is required to file with the Treasury by Tuesday, though it is unclear whether GM will furnish a dollar amount, said people familiar with the matter. The plan is supposed to describe how the company will become self-sustaining and better compete with foreign rivals.
Click to expand...

Interesting. I know that Ch. 11 could cause some MAJOR issues, but i do also see it as an alternative... it allows them to destroy saab, hummer, saturn. But at the same time, wtf will they call this new company?
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I thought they would rather just sell those brands. 😕

Anyway, depending on who has to approve the viability plans, I think that this could really get ugly. The let-them-fail-union-busting crowd will probably try to railroad thru ch.11. We already saw this during the last go-round for the initial bailout. A split into two or more companies does offer a lot of intriguing possibilities though. Perhaps this could be a good thing for the domestic automotive industry afterall.
 
Originally posted by: JSt0rm01
Originally posted by: MIKEMIKE
But at the same time, wtf will they call this new company?
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With the creativity that goes on at that place probably "Motors General"
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Are they still floating around a merger with Chrysler á la General Mopar? 😛
 
This is going exactly as expected. GM admitted readily last year they were burning through many billions/month. Simple math said that around this time frame they would have blown their loan and need more money again. I presume some idiots running the show will feign surprise, but the numbers were about grade three level when the bailout was approved at the end of last year.
 
Obama has already opened the treasury up for anyone who farts in its general direction, no reason for anyone to stop asking for handouts now.

 
Originally posted by: Slew Foot
Obama has already opened the treasury up for anyone who farts in its general direction, no reason for anyone to stop asking for handouts now.
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What you're saying is true with regard to bailouts in general, but I don't think you can pin this one on Obama. GM got a bailout before Obama started throwing money around in his Obama parade, and I'm sure they will need many many many more billions before it's all said and done. If they don't get rid of the unions, they will only be able to survive from the government handout......
 
Originally posted by: JSt0rm01
Originally posted by: MIKEMIKE
But at the same time, wtf will they call this new company?
Click to expand...

With the creativity that goes on at that place probably "Motors General"
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not until they pay a consulting firm tens of thousands of dollars to advise them of "Motors General"
 
From what I've heard from someone that works in the white collar non-uaw section, that its business as usual. They aren't cutting expenses. Management gets free company cars with a gas card to take home etc... Chap 11 seems like the only option at this point.
 
they already knew they'd be asking for more money.

this was just an interim period to come up with a plan. instead of one forced at gunpoint so to speak
 
I think Ch11 would be a good idea if the gov't steps in with DIP financing. GM could ditch the union, dealer contracts and whole bunch of other garbage liabilities that accumulated over the years.
 
Originally posted by: BarneyFife
From what I've heard from someone that works in the white collar non-uaw section, that its business as usual. They aren't cutting expenses. Management gets free company cars with a gas card to take home etc... Chap 11 seems like the only option at this point.
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No way,
I'm guessing you've heard that form someone that heard that from someone? My mom collected all corporate amex cards from the execs at Ford's subsidiary two weeks ago. GM is doing the same, including BS like switching from mechanical pencils to regular pens and such.
 
Yeah I think they've also cut back a lot on big stuff like advertising. It sounds like GM is doing everything in their power to reduce costs. Sales are down so much, though, it may take some massive restructuring for them to survive the downturn. They really need to shed some brands.
 
Originally posted by: MovingTarget
Originally posted by: smack Down
So what is their plan, besides asking for more money?
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Looks like we will find out on Tuesday. 🙂
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Dog and pony. "Unexpected drop in global sales...blah blah...all manufacturers suffering a major hit, we're not doing that much worse...blah blah, liquidity...credit problems...we've cut expenses...exciting new projects..." Basically nothing, they cannot convincingly argue that they have a viable future on their own in any form approximating their current one.

 
Originally posted by: Slew Foot
Obama has already opened the treasury up for anyone who farts in its general direction, no reason for anyone to stop asking for handouts now.
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Absolutely agree! Why try making $$$ when with a "sad story" and a "hat" in hand you can just get it from Capitol Hill?

 
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