Fritz Henderson, the new CEO of GM speaks up. He has plans for GM and is doing his best to reinvent the company. He says changes will be made and he will not wait around for Obama to dictate what those changes are. He wants to make the right budget cuts, reorganize the company’s priority and and make people work harder to prevent further cuts down the road. The company was given a June 1st deadline to change its high debt balance sheet to a profitable company.
General Motors had originally planned to cut 47,000 or so jobs by the end of 2009 and has now announced that they might be doing so earlier than expected in order to cut debt and increase profits. It is a fact that General Motors houses over 244,000 employees and that bankruptcy would impact our economy drastically but GM must remain conscious that keeping its Union Workers on payroll will probably mean it will fall.
General Motors has to somehow find a way to negotiate with union workers and their respective unions a plan to help the company remain afloat without having to pay those awfully large wages simply due to people’s seniority. Henderson also made a note that GM must get rid of its $49 billion in bond debt and secured loans, this money also covers almost 400,000 GM employee’s health care that are now retired and collect retirement benefits.
Henderson finally concluded by saying that GM would most likely have to close 5 of its factories by the end of the year and might claim a small bankruptcy to wipe its debt and try to start fresh. Obama’s administration did said it would help out General Motors with loans and warranty commitments but changes need to be made quickly to ensure GM survives on the long run.
Once again another large company that is willing to claim bankrupcy and dump its debt on tax payers simply due to its poor business model.
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April 8th, 2009 at 7:48 pm
It’s definitely not fair to dump its debt on tax player but the game is too late and too messy. GM should not have survived at the first place:
http://www.wealthalchemist.com/Blog/?s=robert+sutton&x=0&y=0&=Go
April 16th, 2009 at 8:55 am
But if GM does not surivive then we would be shipping even more cars around the world and people will have no jobs. The country should tax imports like how other countries due so to use, for example china.
April 16th, 2009 at 7:55 pm
GM cannot die, it would simply file bankruptcy and downsize tremendously, again this would be temporary. Think about donald trump, he filed bankruptcy 10 times and still continues to make billion
April 19th, 2009 at 8:08 pm
Good post. I enjoyed reading your blog.
April 23rd, 2009 at 9:13 pm
What an excellent blog, I’ve added your feed to my RSS reader.
April 26th, 2009 at 7:55 pm
Great insight! I’ve bookmarked your site.
May 2nd, 2009 at 4:43 pm
Excellent info, especially considering I was looking at this brand for my next car.
May 4th, 2009 at 12:02 pm
GM will file for Chapter 11 so that it can void all of its contracts and negotiate from new with the Unions.
The article said “GM has to somehow find a way to negotiate with union workers and their respective unions a plan to help the company remain afloat without having to pay those awfully large wages simply due to people’s seniority.” Well they tried this with the ex CEO and failed. It costs GM $87 dollors per hour to produce a car and the Toyota $18. The only way to reduce the cost is to go for bankruptcy and wipe out all the healthcare, pension and other costs. The ex CEO was under pressure to do this but he decided to try and save the company and save the rights of workers. Turned out to be delaying the inevitable.
Within the coming months it will happen for sure.
May 9th, 2009 at 8:27 pm
Keep up the good work…great job!
May 18th, 2009 at 10:18 am
Wow! what an idea ! What a concept ! Beautiful .. Amazing
May 19th, 2009 at 9:43 pm
Where can I find a free anonymous web proxy to visit MySpace & Facebook? My school blocks these site. Any ideas?
May 26th, 2009 at 11:39 am
You made some good points there. I did a search on the topic and found most people will agree with your blog.
June 15th, 2009 at 10:57 am
Did Gm deserve the bailout? You Ask me I would say NO.. why? When Honda and Toyota were out inventing new cars, GM was busy boasting about its pride and Showing off its hungry hungry Daughter the Hummer
July 15th, 2009 at 11:55 pm
nicely written!! Good
October 26th, 2009 at 1:33 am
I too heard that they were in huge financial trouble, as far as them closing down, I just heard that they had laid off a huge amount of their staff and that they were just down sizing its no surprise to hear of this as there are many place and companies that are going through this due to the recession that the world is going through.
November 10th, 2009 at 2:47 pm
Good post. I hope GM survived.
November 30th, 2009 at 9:09 pm
I’ve heard about the GM going bankrupt, but hopefully it doesn’t be reality