GM to Offer Two Choices: Bankruptcy or More Aid

Wall Street Journal ^ | 2/14/09 | Wall Street Journal

[jimbo123]

General Motors Corp., nearing a federally imposed deadline to present a restructuring plan, will offer the government two costly alternatives: commit billions more in bailout money to fund the company's operations, or provide financial backing as part of a bankruptcy filing, said people familiar with GM's thinking.

The competing choices, which highlight GM's rapidly deteriorating operations, present a dilemma for Congress and the Obama administration. If they refuse to provide additional aid to GM on top of the $13.4 billion already committed they risk seeing an industrial icon fall into bankruptcy.

[dinodino]

Gee, what a shock.

[RayChuang88]

I think GM is already quietly working with the Commerce Department and SEC on a planned Chapter 11 filing that will allow GM to completely redo all its UAW contracts and also will provide a means to protect its suppliers—this is very important because those suppliers need to be around to protect Ford.

[MGMSwordsman]

A company like GM is like a heroin addict. This kind of blackmail will never stop until they either kill themselves or somehow find the means to go “cold turkey”.

[TheWasteLand]

There’s a third option: nationalization. Can anyone say Obamamobile?

[Sacajaweau]

People will put off buying cars until things stabilize. Payments for 5 or 6 years against even a $500 repair might be the choice.

The same thing with housing...A $25,000 addition against a big, fat new mortgage for 30 years.

[Redleg Duke]

I’ll take “Bankruptcy” for $800, Alex!

[NavVet]

I must be brilliant, since I saw this one coming. Of course, so the other 46% of Americans with a functioning brain.

[mewzilla]

...provide financial backing as part of a bankruptcy filing, said people familiar with GM's thinking.

Bankruptcies cost money so that one I can see.

[NavVet]

I have a GM car going on 250K miles and it is on it’s last leg. I will replace it with a Honda, Toyota, Hundyai or Ford or one of the other companies that aren’t on the government teet.

[PistolPaknMama]

The need more money for their Brazilian operation? Tell them to talk to the frekin Brazilian government!

[Texas Fossil]

Yes, I have a photo of the lates model of the Obamamobile.

It is the party emblem!

[anniegetyourgun]

And those would be conservatives. We’re either brilliant, or we’re the only ones with common sense!

[autumnraine]

Sadly nearly 100% of our reps didn’t. Of course I question the functioning brain part on their behalf.

[autumnraine]

Nissan. I love my Nissans.

[Vigilanteman]

There is a third option: a reorganizational bankruptcy which would allow GM to repudiate the idiotic legacy contracts with UAW. Qualitywise, GM is virtually even with the Japanese car makers now. However, they are unable to get their costs anywhere near as close due to the UAW albatros.

[bitterohiogunclinger]

“this is very important because those suppliers need to be around to protect Ford.”
GM has already been filing bankruptcy through it's suppliers.
Delphi being one example. Now, all the retirees will lose the benefits they were promised or more likely, the taxpayers will end up paying for them. No matter how you feel about the Automakers and the UAW, the consumer and the taxpayers are being held at gunpoint for their excesses. This is where we must take back power from the government and give it back to the people. The government must not be allowed to dictate what products a company must produce or what consumers must buy. That is one of the inherent rights reserved “to the people”.

[bert]

.....A company like GM .....

What other company is like GM?

[Boiling Pots]

That’s a good idea. And when they realize the public won’t willingly buy their crappy cars, they’ll pass a law imposing hefty taxes on any non-nationalized car company.

[Peter W. Kessler]

I ordered an HHR SS right after the first of the year.

It’s not a “Need” thing, it’s a “Want” thing. This will be my last factory hot rod. (It’ll go 140 mph!)

I really ought to call the dealer to find out if they’re actually going to build the thing.

If not, I’ll just keep the Honda Element for another 150,000 miles.