GM Set For Bankruptcy

Twenty Years In The Coming

The day has finally arrived where GM gets its comeuppance and goes into bankruptcy. Ironically, it won’t be wound down, but be restructured under Chapter 11 and sent out to the world anew with a mission to make more eco-friendly cars that people actually want.

It’s a bit like Will Smith’s quip at the Oscars this year where he said he likes action movies because they have stunt, effects and an audience.

General Motors will declare bankruptcy on Monday, US time, marking the end of an era of American manufacturing dominance as what was once the world’s largest corporation collapses under the weight of its mistakes and debts.

Senior US officials have detailed what they hope will be a swift process in which GM should be able to re-emerge from bankruptcy protection as a new, leaner company within 60 to 90 days.

The move means uncertainty for thousands of Australian workers. Industry watchers have suggested Holden may be sold by General Motors. The Australian arm of the automotive giant employs about 6500 people in Australia, about 3100 of them in Victoria.

The debt-riddled US parent has already put Hummer and Saab on the chopping block, along with European brands Opel and Vauxhall.

Well yes, of course! After years of resisting the actual demands of the market, GM essentially lost its dominance through attrition.The iceberg was always on the horizon, but it just kept sailing right along, headlong into the iceberg.

In the 1970s there were rumours and theories of a collusion between the car companies and oil companies to keep oil the centrepiece of transportation; that the car makers could make something far more fuel efficient if it wanted to, but the oil companies wouldn’t let them.

It was a theory that rang true for many a year, but I’m guessing it wasn’t true at all when the crunch came, in as much as the oil companies didn’t really lift a finger to shore up the car companies. I guess the proof is always in the pudding.

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