GM & Chrysler on their knees
http://money.ninemsn.com.au/article.aspx?id=795477
Holden’s parent company, General Motors, said overnight that it was not ruling out bankruptcy as an option, a day after its CEO was forced to resign by US president Barack Obama.
US and global markets plunged overnight after US automakers were set tough new deadlines to avoid bankruptcy, as the government demanded that Chrysler seal a deal with Fiat and rejected General Motor’s rescue plan as it ousted the company’s boss.
Holden said it was ‘monitoring’ the situation in the US but the omens are worrying. Ousted CEO Rick Wagoner was believed to be a strong supporter of plans to build a new four-cylinder car in Adelaide.
After Wagoner was forced to resign yesterday, it emerged that he may be entitled to a pension valued at around $30 million. That includes around $80,000 per year and five annual payments of $6.6 million.
General Motors said in a statement overnight that bankruptcy could be an option.
“Our strong preference is to complete this restructuring out of court,” GM said in a statement after the White House pressed the company for “more aggressive” restructuring to qualify for more state aid.
“However, GM will take whatever steps are necessary to successfully restructure the company, which could include a court-supervised process,” the company statement said, citing the prospect of bankruptcy court proceedings.
As his task force unveiled harsh conditions Monday for additional government loans for GM and another ailing auto giant Chrysler, President Barack Obama said if the two companies could not come up with viable plans to return to profitability, they might need to use the bankruptcy process “as a mechanism to help them restructure quickly and emerge stronger.”
The Obama administration held back an extra 21.6 billion dollars in taxpayer-funded loans for GM and Chrysler, saying neither company had met the strict conditions laid down under an earlier 17.4 billion dollar government bailout agreed late last year.
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looks like GM will be heading to the receivers for “structured re-structuring”..wagoner took a hit and has been replaced..as for chrysler, they will be forced to merge with fiat, the italian auto car maker with strong ties to outsourcing labour, to manufacture cars throughout the world..both companies merging or being re-structured will become CDO events as well so be aware of the fallout to flow from this in about 30-60 days time..on a side note, i found the following very interesting:
“Luca di Montezemolo is chairman of Fiat and his cousin is Andrea Cordero Lanza di Montezemolo, an Italian cardinal of the Roman Catholic church. In 2005 he designed the coat of arms of Pope Benedict XVI and shortly thereafter was named Archpriest of the Basilica of Saint Paul Outside the Walls. Although he is over eighty years of age, and therefore ineligible to vote in a conclave, Pope Benedict XVI announced on February 22, 2006, that Cordero Lanza di Montezemolo would be made a cardinal.”
401
ok, so does this make 7&8 for CDO events??
9 is the magic number, correct.
each contract has the buyers individual companies chosen on it..saying that, GM would be on nearly all of them..so yes if GM falls its a cdo event but its not technically the 9th as such