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GM May Face Bankruptcy

Published 07/03/08 Jeff Bennett - Print Article
E-mail - editor@economyincisis.org

Problems continue to brew for General Motors, America’s top-selling automaker, as bankruptcy may loom in the not-so-distant future.

GM needs an infusion of $15 billion in liquid cash, while their shares plunged to a 54-year low yesterday, according to OttawaCitizen.com.

Auto makers could not foresee the consumer scramble to scrap large gas-guzzling cars for smaller fuel efficient cars. The industry is now struggling. Our current administration in 2001 recognized and drew attention to our oil addiction but made no efforts to make a change. This mess could have been avoided through responsible and accurate governance.


Source OttawaCitizen.com:

General Motors Corp. will need to raise as much as $15 billion in cash to shore up liquidity and bankruptcy is a possibility if the U.S. auto market continues to slump, Merrill Lynch said.

Other analysts have suggested GM, shares of which fell to a new 54-year low yesterday, needs to raise funds to ride out the downturn in the U.S. auto market through 2009. But Merrill's estimate of GM's financing needs is the highest yet. It also carried the most stark warning of the bankruptcy risk for the largest U.S. automaker.

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