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GM Prepared To File For Bankruptcy


In a regulatory filing to the Treasury Department Yesterday, General Motors admitted for the first time to Obama's Auto Task Force that it is seriously considering Chapter 11 bankruptcy protection. The filing stated Chapter 11 would be considered if GM cannot successfully complete an out-of-court restructuring.

Within the filing was a progress report that stayed on-message with GM's consistent claims that an out-of-court restructuring is preferable and holds the "highest value outcome" for both its customers and the U.S. economy.

GM said its decisions were helped by the government's recent pledge to back vehicle warranties and not allow bankruptcy court proceedings to drag out interminably. The company's February 17 plan was criticized as insufficient; President Obama warned that GM would have to take swift action to reduce its swollen $63 billion debt in order to avoid bankruptcy protection.

GM's new CEO Fritz Henderson conceded that bankruptcy is looking more and more possible unless his company can come to agreements with bondholders and the UAW, neither of which have been eager to make concessions.

[source: New York Times]

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Comments (3)
  1. "never saw that coming"

    Neither bondholders nor the UAW will make adequate concessions. Everyone NOT involved in the negotiations knows this, which is why a bankruptcy judge has to decide who takes the big haircuts. On another note, now that the government is backing GM warranties, I'll be submitting a claim to replace that solid titanium bumper hitch on my GM truck--I had the NASA performance package.
     
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  2. "UAW Give it UP, Baby!"

    UAW is not going to get a haircut, they're going to get their stoopid heads shaved before this is done. Because of the unions' greed and unwillingness to give up "Major" concessions in pay, benefits, retirement, health benefits, and legacies, they will wind up in liquidation. THEN we average Americans can afford those Corvette's, Escalades, etc., during the auctions. THANK YOU, UAW!
     
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  3. "'YO, THEY MUST GO!"

    The UAW thinks the Americans owe them for all of the money it'll take to keep them solvent, indefinitely. In spite of the fact that NO other segment of the American public makes anything near what they unionists make. We've been paying their bailouts for decades now for overpriced, underengineered, boring vehicles, and the union workers now think we owe them perpetual bailouts? NOT! Bye-bye you overpaid crybabies!!!
     
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