Bailout Watch 402: GM Requests Additional $22.5B in Government Funds
Full report now available at GM Media ( pdf) ( summary html).
Automotive News [sub] is reporting that GM’s new viability plan includes a request for an additional $22.5B in government funds. Without this money GM would run out of operating cash by sometime March. GM’s plan also calls for cutting 47,000 jobs globally by the end of 2009 and shuttering five unspecified US factories by 2012. GM CEO Rick Wagoner just thanked government officials “around the world” for “their openness.”
As Farago noted earlier, GM received tranche deux of its already-approved $13.4B loan today. They also request $4.6B per their December 2 request to round it all out to an even $18B. There’s also a request for $4.5B to pay of a revolving credit line that comes due in the fall of 2011. And then there’s the request for a $7.5B line of credit GM could tap “if” sales worsen over the next two years. This would bring GM’s taxpayer butcher’s bill to about $30B dollars. Incredibly, GM expects to begin repaying these loans by 2012.
GM also predicts that its North American operations will break even at an annual market rate of 11.5m to 12m units. Interesting. “The operating and balance sheet improvements outlined in GM’s viability plan are forecasted to result in a significant enterprise value and positive net present value, positive adjusted EBIT in 2010 and positive operating cash flow for its North American operations in the same year.”
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The Muppets video is perfect btw... This is starting to stink - Wagoner (Way-goner?) seems proud that he's receiving government money to cut jobs and close plants. Maybe he should have spun it a little more positively, but at this point it's a total crap-shoot as to how many jobs these billions will save...
I find it interesting that GM's main arguement against C11 is the example of Deawoo. Ironic?
Mr. Waggoner stated last night that GM was a bit underfunded in their pension contribution obligations. Oops! Today this shortcoming was stated to the tune of $18 Billion due by 2014. Let's see, $22.5 B + $18B - aw, forget it.
What's wrong with this headline: (2.26.09) "GM needs $16B to make it through 2009" Carmakers are leading the manufacturing downturn. Detroit- based General Motors Corp. yesterday reported the second-biggest quarterly loss in its 100-year history, as Chief Executive Officer Rick Wagoner asked the Treasury for $16.6 billion more in loans (just) to survive through 2009. Opinion Have we all lost our minds!? Stop this madness now in all matters.