General Motors (NYSE: GM) CEO Fritz Henderson says that bankruptcy remains likely for the company, as the company lobbies Washington for billions more in taxpayer funding to make it through the next quarter.
"I felt several weeks ago that it would be more probable that we would need to go through a bankruptcy process. I certainly feel that way. That continues today," Henderson said.
He was mum on reports that the company is set to jettison GMC and Pontiac, saying instead that "We are, frankly, kind of taking the watch apart, step by step, and then rebuilding it, asking questions to make sure, for example, in brands, we have a purpose for every one of our brands, our four core brands that we've talked about."
"Our preference is to try to accomplish this outside of a bankruptcy process," he said. "It is still feasible to be able to do that, given the timing, but obviously, the clock is ticking."
Henderson said the company had more plans for layoffs of white-collar and blue-collar employees, and would be able to make an announcement about that by June 1st. General Motors hasn't yet had any luck in securing the needed concessions from its bondholders, one of the cornerstones of securing additional aid outside of the bankruptcy court.
At some point though, you have to think the company's bondholders will figure out that they're better off taking whatever equity they can get now and living to fight another day instead of letting the company slide into bankruptcy. It's a game of chicken for now, and everyone -- management, the union, bondholders and President Obama -- is trying to look tough.
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Reader Comments (Page 1 of 1)
4-18-2009 @ 9:58AM
Donovan said...
Bankruptcy is really GM's only option at this time. Have you seen that new Segway smurf mobile GM designed. only $40,000 and a total open air death trap. What the damn thing is, is an over priced golf cart with very limited usability. Unless you live in a very warm climate. And to think millions and billions of dollars have been given to GM's research and design teams. And this is the best those idiots can come up with. No wonder GM has severe financial problems.