ogarawo.wordpress.comGM filed for Chapter 11 bankruptcyh this morningin U.S. Bankruptcy Courtf in Manhattan, the largest-ever U.S. manufacturing The bankruptcy, which is expectedc to go quickly, now effectively gives taxpayers 60 percent ownership ofthe company. Monday’xs Chapter 11 filing by the 101-year-olde company — once the world’s biggesgt automaker — is among the largest in U.S. Chapter 11, which allows the companuy to operate while protected from its pushes GM intoa fast-track bankruptcy and provides $30 billiobn of additional taxpayer funds to restructurwe itself.
General Motors CEO Fritz Henderson said in a prepare statement that GM was being reinventerd and that the company is ready for the jobat "The economic crisis has caused enormoue disruption in the auto industry, but with it has come the opportunitg for us to reinvent our he said. "We are going to do it once and do it The court-supervised process we are pursuing providexs us with powerful tools to accelerate and complete our as well as strong safeguards for our customers and our business." The bankruptcuy follows months of speculation that GM would have to restructure through the courts, despited desperate attempts by management to avoixd the move.
As it turnec out, though, the bankruptcy filing was the only way GM coulr get its hands on the governmeng money it needsto survive. In its GM listed $82.3 billion in assets and $172.8 billio in debts. The automaker's top creditors listeds in the filingincludew Nashville-based Bridgestone Corp. The company also owes the tiremaker $4.4 The U.S. government has already injected $20 billion into GM, and will provid another $30 billion to keep the company goinfg as it worksthrough bankruptcy. The investmentr will buy the governmenta 72.5 percent That will give government officials more power to name memberws of the GM board.
Officials have said they don’gt want to get involved in the dailyu operations ofthe company. The GM plan as detaileds by U.S. officials would allow a much smaller GM to emerge from courty protection within 60 to 90 GM also plans to clos11 U.S. facilities by the end of and will idle anotherthree plants, includingg the plant in Spring which employs more than 3,00 0 people. The Spring Hill planrt will stop production but remainj on standby until thecompany said. The plantt reopened in October 2008 afterra 12-month, $1 billion refurbishment and modernization to produce the Chevrolet Traversew crossover vehicle and partse for other GM cars and trucks.
" fear that Spring Hill's familiea are now paying for Washington'as folly. The uncertainty they are facinv today could havebeen avoided," Tennesses Congresswoman Marsha Blackburn said in a statemenf released Monday. "Late last I joined my colleagues in recommending a structuredc bankruptcy for General Motors and The bailout alternative that was pursued has failed. What we are left with is the near complete nationalizatiohn of what was onceour nation's flagship mountains of federal families uncertain about their future now that the Spring Hill planrt sits idle, and the parts suppliere and small businesses who depended on Sprintg Hill facing tough choices.
" The plants slated to close include two assemblyt plants, Pontiac, Mich. (October 2009), and Wilmington, Del. (Jul y 2009), and three stamping plants, Grand Mich. (June 2009), Indianapolis, Ind. (December 2011), and Ohio (June 2010). Powertrain facilities in Flintand Ypsilanti, as well as Ohio, and Fredericksburg, Va., are also on the closurwe list. GM plans to sell or close such brandaas Saturn, Saab, Hummer and and will shed 2,600 dealerships. The automaker has not provided an updatex target for job cuts but was looking toeliminatee 21,000 U.S.
factory jobs from the 54,0090 United Auto Workers union members it now General Motorsemploys 92,000 in the Unitesd States and is indirectly responsibled for 500,000 retirees. The U.S. government woulf hold a 60 percent financial interest in a reorganizerd GM and the UAW would takea 17.5 percent stake. The governmentzs of Canada and the province of Ontariol have agreed to a 12 percent ownership stakse in exchange forfinancial aid. GM bondholdersd would get 10 percent.
