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GM survival plan at a glance

CarsGuide team

28 Apr 2009 • 1 min read

Vehicles

Move the shedding of Hummer, Saab and Saturn forward to the end of this year, with Pontiac gone by the end of 2010.

Cut production by 190,000 in the second and third quarters.

Dealership network

Slash dealerships by 40 per cent to 3,605 from 6,246.

Workforce

Reduce the workforce from 61,000 to 40,000 – 7000 more than suggested in the viability plan put forward in February.

Financial

Execute a debt-swap and restructure that positions the US Government as a majority owner of about 50 per cent — in exchange for forgiving half the debt of the $US15.4 billion already loaned to GM, and adding another $US11.6 billion to it.

The United Auto Workers union pension fund would own 40 per cent in exchange for half of the $US20 billion it’s owed.

Holders of GM’s $US27 billion worth of bonds would end up owning 10 per cent, with the carmaker exchange 225 common shares for each $US1000 principal amount of outstanding notes.

If the bondholder approval rate falls short of the required 90 per cent, GM will file for bankruptcy protection, with bondholders estimated to get just 5c in the dollar – a far cry from the 33c tipped earlier this year.