General Motors Corporation future worsens as losses increase, revenue tumbles
http://www.theweeklydriver.com/articles/1404/1/General-Motors-Corporation-future-worsens-as-losses-increase-revenue-tumbles/Page1.html
By The Weekly Driver News Service
Published on 05/7/2009
General Motors Corporation posted a $6 billion first quarter loss and spend $10.2 billion in cash in the first three months of 2009, resulting in the automaker's revenue plummeting $20 billion. Ray Young, the carmaker's CFO, said talk of the company going into Chapter 11 bankruptcy protection likely dissuaded consumers from buying GM vehicles.
General Motors Corporation posted a $6 billion first quarter loss and spend $10.2 billion in cash in the first three months of 2009, resulting in the automaker's revenue plummeting $20 billion.
Ray Young, the carmaker's CFO, said talk of the company going into Chapter 11 bankruptcy protection likely dissuaded consumers from buying GM vehicles.
The largest U.S.-based automaker faces a June 1 government deadline to finish a restructuring plan or go into bankruptcy protection. GM's loss for the quarter amounted to $9.78 per share, compared with a loss of $3.3 billion, or $5.80 per share in the same time frame in 2008.
Revenue dropped sharply — 47 percent — from $42.4 billion to $22.4 billion in the quarter because of declining sales worldwide, primarily in North America and Europe, according to GM.
GM Corporation cut costs by $3 billion, but Young said it wasn't enough to offset the increasing losses. revenue.
As a result, GM faces an improbable list of restructuring tasks before the June 1 deadline. It must get new cost-cutting agreement with its unions, complete a debt-for-stock swap with 90 percent of its bondholders, close factories and cut jobs to prove to the government it can repay the loans.
The automaker also is trying to cut 2,600 dealerships and is in the process of selling or phasing out the Saturn, Saab and Hummer brands. Pontiac was recently dispatched from the GM offering.
General Motors Corporation posted a $6 billion first quarter loss and spend $10.2 billion in cash in the first three months of 2009, resulting in the automaker's revenue plummeting $20 billion. Ray Young, the carmaker's CFO, said talk of the company going into Chapter 11 bankruptcy protection likely dissuaded consumers from buying GM vehicles.General Motors Corporation posted a $6 billion first quarter loss and spend $10.2 billion in cash in the first three months of 2009, resulting in the automaker's revenue plummeting $20 billion.Ray Young, the carmaker's CFO, said talk of the company going into Chapter 11 bankruptcy protection likely dissuaded consumers from buying GM vehicles.
The largest U.S.-based automaker faces a June 1 government deadline to finish a restructuring plan or go into bankruptcy protection. GM's loss for the quarter amounted to $9.78 per share, compared with a loss of $3.3 billion, or $5.80 per share in the same time frame in 2008.
Revenue dropped sharply — 47 percent — from $42.4 billion to $22.4 billion in the quarter because of declining sales worldwide, primarily in North America and Europe, according to GM.
GM Corporation cut costs by $3 billion, but Young said it wasn't enough to offset the increasing losses. revenue.
As a result, GM faces an improbable list of restructuring tasks before the June 1 deadline. It must get new cost-cutting agreement with its unions, complete a debt-for-stock swap with 90 percent of its bondholders, close factories and cut jobs to prove to the government it can repay the loans.
The automaker also is trying to cut 2,600 dealerships and is in the process of selling or phasing out the Saturn, Saab and Hummer brands. Pontiac was recently dispatched from the GM offering.