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IN DECEMBER, when GM secured a large slice of government bail-out funds to keep it alive, the giant car company was jokingly dubbed Government Motors. The company’s latest—and most sweeping—restructuring plan, announced on Monday April 27th, could make the joke a grim reality. GM had until the end of May to present proposals to persuade America’s government to release billions more of taxpayers' dollars to keep it from the bankruptcy court. GM believes it has done the job already with a plan that gives the government a 50% stake in the firm. Now the important deadline is May 26th, by when the company’s creditors are supposed to agree to a deal which treats them far less generously.
The latest plan, devised in close consultation with the Obama administration’s car-industry task force, is a last-ditch effort to get GM into competitive shape. The firm announced that another 21,000 jobs will be lost in America next year, bringing the workforce down to around 40,000. The Pontiac brand will go and the production of Saturn models will disappear at the end of this year, somewhat earlier than had been proposed. GM also aims to shut several factories and will reduce its dealership network from some 6,200 to 3,600 (a bigger cut than previously planned).
GM suggests that these measures would save about $7 billion a year.ndemic up from level 3, using a system that was revised in the wake of the 2003 SARS outbreak.
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