GM plan calls for $30 billion, 47,000 job cuts (asking for $16.6 billion more)

[Miss Mia]

GM plan calls for $30 billion, 47,000 job cuts
By TOM KRISHER and KEN THOMAS – 20 minutes ago

DETROIT (AP) — General Motors Corp.'s restructuring proposal says the company may need up to $30 billion in government loans as it implements a survival plan that includes cutting 47,000 jobs and closing five more U.S. factories.

GM submitted the dire plan to the Treasury Department on Tuesday to explain how the Detroit automaker will become viable and repay its loans. It says GM will try to borrow up to $16.6 billion more from the government, on top of the $13.4 billion it has already received.

With the restructuring, GM expects to start repaying the government in 2012 and fully pay off the loans by 2017.

GM says it has considered the option of bankruptcy, but the only credit available to finance a reorganization would be from the government, and it could cost as much as $100 billion.

[Chris]

GM can burn through that in about 6-9 months. 

[Miss Mia]

Here's more:

GM would also cut 47,000 jobs globally by year end and close five U.S. plants by 2012. It raised the possibility of killing the Saturn brand when production of its current models ends in 2012.

GM received the last installment of a previously approved $13.4 billion loan today, but is requesting another $4.6 billion to meet its Dec. 2 request of $18 billion. It then will ask for $4.5 billion to help it repay a revolving line of credit coming due in the fall of 2011.

GM also is seeking a $7.5 billion revolving line of credit to help it if auto sales worsen later this year or next year. GM plans to start repaying the loans in 2012.

The proposals are contained in a restructuring plan made public by GM today. Both GM and Chrysler LLC were required to deliver plans to the Treasury Department today. Chrysler is asking for an additional $2 billion in loans.

-snip-

GM's plan outlines how the company proposes to achieve a "sustainable return to profitability" within the next 24 months, sources familiar with the plan say.

Of the 47,000 jobs to be cut this year, 37,000 will be hourly.

GM plans to continue to supply current product to Saturn through 2012. But absent an alternative to fix the brand, GM expects to phase it out.

Hummer, which GM has had for sale since June, has attracted several interested parties. GM expects to make a decision on what to do with Hummer by the end of the first quarter, the sources say.

GM is in talks with the Swedish government and several other parties about Saab's future. Without funding help from the Swedish government, Saab would have to file for reorganization, the sources say.

Among other things, GM was told to get bondholders to accept stock in exchange for debt, and the companies were advised to trim worker compensation to the level of the U.S. plants of import brands, or explain how comparable savings would be achieved.

-snip-

Sorry it's a subscription site  http://www.autonews.com/apps/pbcs.dll/article?AID=/20090217/ANA02/902179951/1197

[Chris_]

Sold their souls to the Devil.

If Ford hangs tough, I will hold my nose and actually buy one of the POS they manufacture.

[Chris]

Sold their souls to the Devil.

If Ford hangs tough, I will hold my nose and actually buy one of the POS they manufacture.

Some Fords are not bad.  Most of the new models are build on a European chassis... better design, higher quality.  The Five Hundred/Taurus is built on a Volvo and Mazda shares a couple platforms with Ford as well.

[Miss Mia]

Sold their souls to the Devil.

If Ford hangs tough, I will hold my nose and actually buy one of the POS they manufacture.

Ford says UAW deal will help it avoid federal aid

DETROIT -- Ford Motor Co. said late today that it had reached a tentative agreement with the UAW that will help the company avoid seeking emergency loans from the U.S. government.

The agreement modifies labor costs, benefits and operating practices and puts Ford's cost structure on par with the manufacturing operations of transplant automakers, said Joe Hinrichs, Ford group vice president of global manufacturing and labor affairs, in a statement.

Ford did not detail the agreed-upon changes.

If ratified, the deal "would help Ford operate through the current economic downturn without accessing a U.S. government bridge loan and continue to invest in the company's One Ford product-led transformation," Hinrichs said.

The agreement was reached Sunday afternoon. But discussions continue on how to structure funding of the Voluntary Employees' Beneficiary Association, or VEBA, retiree health care trust. A final settlement is contingent on a VEBA funding agreement, Ford said.

A final agreement would cover 42,000 UAW-represented employees in the United States.

Because of the ongoing discussions, Ford said it won't discuss more details at this time.

Said Hinrichs: "All of us at Ford will continue to work with all of our stakeholders to participate in the current industry restructuring and improve our company's overall competitiveness."
This is from Automotive News (subscription site)  http://www.autonews.com/article/20090217/ANA02/902179943/1200

UAW reaches new agreements with Detroit 3
Debt-for-equity negotiations continue

David Barkholz
Automotive News
February 17, 2009 - 5:35 pm ET

DETROIT -- The UAW today reached tentative agreements with the Detroit 3 on concessions to help the automakers weather the recession.

But the thorny issue of swapping debt owed to retiree health-care funds for company stock remains unresolved.

General Motors and Chrysler LLC were seeking concessions as part of their viability plans for federal bailout money. Ford Motor Co. is not seeking bailout money but wanted parity with Chrysler and GM.

A source familiar with the talks said the concessions involve overtime, bonuses and limits on unemployment benefits.

But the UAW had not reached agreement on a proposed debt-for-equity swap with Chrysler and GM, a condition of federal aid to the automakers. The Bush administration, which loaned money to GM and Chrysler in December, wanted the UAW to take half of the remaining money owed to its Voluntary Employees' Beneficiary Associations in company stock.
http://www.autonews.com/article/20090217/ANA02/902179947/1200

[Crazy Horse]

The Unions will hold out since one of the new tsar's committee people is a pro union person.  They will not concede much if anything, Barack "Hoffa" Obama is the president

[rich_t]

Oh ffs!

The company is terminal.  Send it to a hospice and let it die.

Agreed.  No such thing as "too big to be allowed to fail"

[Chris]

GM To Officially Kill Saturn Brand, Most Of Pontiac
Our sources tell us GM's viability plan set to be released at 5:00PM will kill the Saturn brand by 2011. Pontiac will also go away as a division. But the nameplate will sorta live on.

So basically, what we've heard is the brand meant to compete against the foreign brands is dead — Saturn goes away in 2011. There will be no new products for Saturn and Saturn dealers are getting a video from Mark LeNeve at 5:00 PM to inform them. We're thinking Mark should cut a check to send with it. As far as Pontiac, it goes away as a division. The nameplate will live on on some vehicles — but we've got no idea what "niche products" they're talking about. More coming shortly.

Jalopnik


This should have been the obvious decision, along with GMC Truck.  They're not selling anything other than rebadged Chevrolets.