Advertisement
Find a Car
Go!

GM Cuts Pontiac and 21,000 Jobs Page 3

Follow Marty

2009 Pontiac G8

Strengthening GM's balance sheet

Another key element of GM's restructuring will be taking the necessary actions to strengthen its balance sheet. GM today took an important step in improving its balance sheet by launching a bond exchange offer for approximately $27 billion of its unsecured public debt. If successful, the bond exchange would result in the conversion of a large majority of this debt to equity.

"A stronger balance sheet would free the company to invest in the products and technologies of the future," Henderson said. "It will also help provide stability and security to our customers, our dealers, our employees, and our suppliers."

Another important part of improving the balance sheet will be the ongoing discussions with the UAW to modify the terms of the Voluntary Employee Benefit Association (VEBA), and with the U.S. Treasury regarding possible conversion of its debt to equity. The current bond exchange offer is conditioned on the converting to equity of at least 50 percent of GM's outstanding U.S. Treasury debt at June 1, 2009, and at least 50 percent of GM's future financial obligations to the new VEBA. GM expects a debt reduction of at least $20 billion between the two actions.

In total, the U.S. Treasury debt conversion, VEBA modification and bond exchange could result in at least $44 billion in debt reduction.

Throughout the Plan, GM will continue to make significant investment in future products and new technologies, with an investment of $5.4 billion in 2009, and investments ranging from $5.3 to $6.7 billion from 2010 to 2014. Very importantly, development and testing of the Chevy Volt extended-range electric car remains on track for start of production by the end of 2010 and arrival in Chevrolet dealer showrooms soon thereafter.

"The Viability Plan reflects the direction of President Obama and the U.S. Treasury that GM should go further and faster on our restructuring," Henderson said. "We appreciate their support and direction. This stronger, leaner business model will enable GM to keep doing what it does best - provide great new cars, trucks and crossovers to our customers, and continue to develop new advanced propulsion technologies that are vital for our country's economy and environment."


Posted in:
 
Follow Us

 

Have an opinion?

  • Posting indicates you have read this site's Privacy Policy and Terms of Use
  • Notify me when there are more comments
Comments (4)
  1. "Pontiac Conversion is Needed"

    While Pontiac will be shut down, at least three of its vehicles should switch badges and become Chevy's. These are the Solstice, Vibe and G8. There are no models currently like these in the North American divisions with the exception of Saturn. Also, Vibe is one of the handful of GM vehicles with a predicted reliability rating of better or much better than average. Truth be told the Vibe platform, which is the same as the Toyota Corolla/Matrix, should also be used as the platform for the Chevy Cruze and HHR. I have seen the Cruze and read a model preview. It will not equal the competition which includes the Corolla/Matrix, Civic, and Vibe.
     
    Post Reply
    Vote
    Bad stuff?

  2. "Thrre duces and a 4 speed and a 389"

    God it was great! Crusin' down Francis Lewis Blvd. in Queens,NYC in Danny's 64 GTO. Man we were some hot stuff and the thrill of the Tri-Carb engine at every stop light was magic. Now our youth has little but Toyotas and Hondas that are so bland it defines an ambiguous lost generation. The end of Pontiac,to me, a boomer, is like losing a friend. I doubt the bean counters could ever know what it was all about when the Muscle Car, Drive in Burger hangouts, and cool guys were all simple clean fun. We've lost more than just Pontiac. Shame is nobody really cares much anymore. Well, I still have the memories, sniffle, sniffle!
     
    Post Reply
    Vote
    Bad stuff?

  3. "The Chinese will buy it!"

    Just think about it... Chevy is selling a bunch of Korean cars already; even more in the future and the Chinese could be selling their geely crap through Pontiac. The dealers and all the loyal consumers down South would eat this up.
     
    Post Reply
    Vote
    Bad stuff?

  4. "Remember The Great USA"

    GM-Pontiac made great cars, now we give all the jobs and big prifits to China and other country's. What is wrong with us? It's all corporate greed. They don't think about their children or grand kids.
     
    Post Reply
    Vote
    Bad stuff?

 

Have an opinion? Join the conversation!

Advertisement
Advertisement
Take Us With You!
   
Advertisement

More From High Gear Media


 
 
© 2014 The Car Connection. All Rights Reserved. The Car Connection is published by High Gear Media. Stock photography by Homestar, LLC. Send us feedback.