Experts see it as all but certain that after 100 years in business and 10 months of frenzied but failed restructuring, General Motors (GM) will follow its smaller rival Chrysler into federal bankruptcy court.
Facing a government-imposed June 1 deadline to restructure, GM’s clock is ticking.
From Reuters: [The automaker] is scrambling to slash some $27 billion of bond debt, win sweeping cost concessions from the United Auto Workers union and eliminate almost 1,600 U.S. dealers.
GM has said that it must have 90 percent of the $27 billion of bonds participate in the exchange or it will be forced to file for bankruptcy.
Underscoring the divisions between GM and stakeholders, the UAW on Monday repeated its opposition to a GM restructuring plan that includes closing 16 U.S. plants.
GM’s announcement last week that it planned to drop more than a quarter of its nearly 6,000 U.S. dealers has also triggered an outcry from some of those independent businesses
GM’s debt-laden balance sheet however, is the source of its immediate crisis and the main reason restructuring experts, analysts and auto executives see a bankruptcy filing for the automaker as almost inevitable.