Jump to content

Historic Day June 1, 2009 -the day GM files for bankruptcy protection


KAMAY11
 Share

Recommended Posts

This press release was just emailed to everyone in my company....SO sad!

 

I apologize, its quite long!

 

 

 

FOR RELEASE: 2009-06-01

 

GM ANNOUNCES AGREEMENT WITH U.S. TREASURY AND CANADIAN GOVERNMENTS PROVIDING FAST TRACK TO COMPETITIVE FUTURE FOR 'NEW GM'

 

NEW GM, BUILT FROM COMPANY'S STRONGEST OPERATIONS, EXPECTED TO LAUNCH IN 60-90 DAYS UNDER NEW OWNERSHIP

 

GM FILES VOLUNTARY CHAPTER 11 TO IMPLEMENT '363' SALE AGREEMENT

 

GM IS OPEN FOR BUSINESS IN THE U.S. AND WORLDWIDE, HONORING ALL CUSTOMER COMMITMENTS

 

Warranty, service and customer support continue uninterrupted, backed by the U.S. and Canadian governments

Essential suppliers to be paid in the normal course

Employees to be paid in the normal course

Operations outside U.S. not included in court filing

DETROIT, June 1, 2009 - General Motors Corp. (NYSE: GM) today announced that it has reached agreements with the U.S. Treasury and the governments of Canada and Ontario to accelerate its reinvention and create a leaner, stronger "New GM" positioned for a profitable, self-sustaining and competitive future.

 

Pending approvals, the New GM is expected to launch in about 60 to 90 days as a separate and independent company from the current GM ("GM"), with two distinct advantages: it will be built from only GM's best brands and operations, and it will be supported by a stronger balance sheet due to a significantly lower debt burden and operating cost structure than before. The New GM will incorporate the terms of GM's recent agreements with the United Auto Workers (UAW) and Canadian Auto Workers (CAW) unions and will be led by GM's current management team.

 

The New GM will execute the key elements of its April 27 viability plan, along with additional initiatives, to achieve winning financial results by putting customers first, concentrating on adding to the company's line of award-winning cars and trucks through four core brands and continuing to invest in green, energy-saving technologies.

 

Under its plan, GM will sell substantially all of its global assets to the New GM. To implement the sale agreement, GM and three domestic subsidiaries have filed voluntary petitions for relief under chapter 11 of the United States Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of New York, and the sale is subject to the approval of the Court. Because GM's sale of assets to the New GM already has the support of the U.S. Treasury, the UAW and a substantial portion of GM's unsecured bondholders, GM expects the sale to be approved and consummated expeditiously.

 

GM has asked the Court to approve a number of steps to protect current and new GM customers, ensure that its operations will continue uninterrupted during the court-supervised process, and provide for a smooth transition to the New GM.

 

GM dealers will continue to service GM vehicles and honor GM warranties, and U.S. and Canadian government guarantees of manufacturers' warranties are designed to reassure consumers.

GM will use its cash-on-hand and a new Debtor-in-Possession (DIP) financing of approximately $33 billion to: ensure an uninterrupted supply of goods and services and provide for other cash requirements prior to closing of the asset sale; fund liabilities to secured lenders; and provide contingency funding to handle any potential unexpected needs. Furthermore, in conjunction with the sale, the U.S. Treasury and the Canadian and Ontario governments will provide funds to administer the wind down of the remaining assets and the closing of the chapter 11 cases.

GM employees worldwide will become part of the New GM.

"Today marks a defining moment in the reinvention of GM as a leaner, more customer-focused, and more cost-competitive company that, above all, can quickly generate winning bottom line results," said Fritz Henderson, GM president and CEO. "The economic crisis has caused enormous disruption in the auto industry, but with it has come the opportunity for us to reinvent our business. We are going to do it once and do it right. The court-supervised process we are pursuing provides us with powerful tools to accelerate and complete our reinvention, as well as strong safeguards for our customers and our business. We are focused on the job at hand, for the benefit of our customers, employees, dealers, suppliers, retirees, taxpayers, investors and other stakeholders.

 

"We recognize the sacrifices that so many have been asked to make as we have worked to reinvent GM and the automobile," said Henderson. "GM deeply appreciates the support and the demonstration of confidence in our future by President Obama, the Presidential Task Force on Autos, the Canadian and Ontario governments, American and Canadian taxpayers, the unsecured bondholders who are supporting the proposed sale transaction, the UAW and CAW and their leadership, and the men and women of GM, including our retirees. You have enabled us to carry out this vital transformation for the good of GM, our customers and the economy, and we are working to validate your trust each day.

 

"From day one, the New GM will be well-positioned to capitalize on the award-winning vehicles we have developed and launched during the past few years, and on our investments in exciting new technologies like the Chevy Volt, so that we can build and return value to our customers and to the millions who will have a stake in our success. The New GM will play a critical role in the future of the automobile, and assure that the U.S. has a strong stake in this rapidly changing global manufacturing industry," Henderson said.

 

Business operations continue globally without interruption

 

GM's North American manufacturing operations continues to monitor production output to make sure it aligns with market demand, and currently intends to ramp up manufacturing operations as market demand improves during the latter half of the year.

 

None of GM's operations outside of the U.S. are included in the U.S. court filings or court-supervised process, and these filings have no direct legal impact on GM's plans and operations outside the U.S. GM confirmed that all business operations are continuing without interruption in its Europe; Latin America, Africa and the Middle East; and Asia Pacific regions.

 

"Worldwide, GM dealers are open for business, offering competitive financing options on our award-winning vehicles, continuing to honor our industry-leading warranty coverage, and providing outstanding service," said Henderson. "Furthermore, the U.S. Treasury and the Canadian governments have issued a strong vote of confidence by backing GM's vehicle warranties."

 

GM has filed various "first day" motions with the Court to ensure the company's continued ability to conduct normal business operations. Upon Court approval, GM will be expressly authorized, among other things, to:

 

Honor all obligations to customers and continue customer programs, including warranties, without interruption

Respect our operating and financing agreements with GMAC, supporting continued wholesale financing for dealers and retail financing for customers

Pay dealers' open accounts and continue warranty and incentive programs

Pay essential suppliers and logistics providers for goods and services provided before and after the company's court filings

Continue pay and benefits for employees and retirees; however, the amount of non-qualified pension for some executive retirees may be affected.

The New GM

 

GM's agreements with the U.S. Treasury, the Canadian and Ontario governments and the UAW and CAW, in addition to the support of a substantial portion of GM's unsecured bondholders, will enable the New GM to be a leaner, faster and more customer-focused enterprise, consistent with the vision, goals and plans of GM's enhanced operating plan announced April 27.

 

The New GM will:

 

Focus on four core brands in the U.S. - Chevrolet, Cadillac, Buick and GMC - with fewer nameplates and a more competitive level of marketing support per brand

Effectively close the competitive gap in active worker labor costs compared with transplant auto manufacturers

More efficiently utilize U.S. capacity while increasing over time the percentage of U.S. sales manufactured domestically

Feature lower structural costs enabling its North American region to break even (on an adjusted EBIT basis) at a U.S. total industry volume of approximately 10 million vehicles. This rate is substantially below the 15 to 17 million annual vehicle sales rates recorded from 1995 through 2007

Achieve its lower structural costs in part by further reducing 2009 salaried employment in North America from its year-end total of 35,100 to approximately 27,200, and continuing to improve its balance sheet by reducing retiree benefits for salaried retirees and non-UAW hourly retirees

Provide a higher level of customer service through a more focused U.S. network of approximately 3,600 dealers

Continue and increase its investment and leadership in fuel economy and advanced propulsion technologies

Capital Structure of the New GM

 

A critical element of GM's reinvention is to achieve a significantly stronger and healthier balance sheet. On March 31, 2009, GM reported consolidated debt of $54.4 billion, along with additional liabilities, including an estimated $20 billion obligation to the UAW VEBA.

 

Under GM's agreements with the U.S. Treasury, the Canadian and Ontario governments, and the UAW and CAW, and with the support of a substantial portion of GM's unsecured bondholders, upon closing of GM's sale of assets to the New GM, the New GM's capital structure will be comprised of:

 

Approximately $17 billion in total consolidated debt, including:

$6.7 billion of debt owed to the U.S. Treasury

$1.3 billion of debt owed to the Canadian and Ontario governments

$2.5 billion of notes issued to the new Voluntary Employee Beneficiary Association (New VEBA)

Approximately $6.8 billion of other, primarily international debt, but excluding Europe

$9 billion of perpetual preferred stock with a 9 percent annual dividend, payable quarterly in cash, $2.1 billion of which will be issued to the U.S. Treasury, $0.4 billion of which will be issued to the Canadian and Ontario governments and $6.5 billion of which will be issued to the New VEBA

Common equity, 60.8 percent of which will be owned by the U.S. Treasury, 11.7 percent of which will be owned by the Canadian and Ontario governments, 17.5 percent of which will be owned by the New VEBA, and 10 percent of which has been reserved for GM for the benefit of the unsecured bondholders and other unsecured creditors of GM

Warrants granted to the New VEBA to acquire newly issued shares in the New GM equal to 2.5 percent of its outstanding common equity

Warrants granted to GM at closing to acquire newly issued shares in the New GM equal to 15 percent of its outstanding common equity, with various exercise prices and expirations

Other than the $8 billion of debt owed to the U.S. Treasury and the Canadian and Ontario governments by the New GM, all amounts owed by GM or the New GM to the U.S. Treasury and Canadian and Ontario governments would be equitized in exchange for the New GM securities described above, and no other debt will be owed by GM to the U.S. Treasury and the Canadian and Ontario governments.

 

GM Europe Restructuring

 

GM announced separately today, GM Europe has an agreement for €1.5 billion of bridge financing from the German government and a Memorandum of Understanding to partner with Magna International Inc. Under the agreement, the Opel/Vauxhall assets have been pooled under Adam Opel GmbH, with the majority of the shares of Adam Opel GmbH being put into an independent trust (the balance to remain with General Motors), while final negotiations with Magna proceed. Negotiations to close the agreement should take several weeks. .

 

New products and technologies on track

 

The New GM, with its strong financial base and best-in-class dealer network, will support a portfolio of award-winning vehicles, including the Chevy Malibu (2008 North American Car of the Year and J.D. Power and Associates' segment leader in its 2008 Initial Quality Survey), Cadillac CTS (Motor Trend Car of the Year) and its Buick brand (tied for 1st place in J.D. Power and Associates' 2009 Vehicle Dependability Study). The New GM will have a number of key vehicle launches in 2009 and 2010, including:

 

Chevrolet Camaro, a dramatic, moderately priced sport coupe with highway fuel economy of up to 29 mpg

An all-new Buick LaCrosse premium midsize sedan

The luxury midsize Cadillac SRX crossover and CTS Sport Wagon

The Chevy Equinox and GMC Terrain, midsize crossovers with class-leading highway fuel economy of 32 mpg

The Chevy Cruze, GM's new global compact car

The revolutionary Chevy Volt, an extended-range electric vehicle that can travel up to 40 miles on battery power alone with the extended-range capability of more than 300 total miles.

"Our products are our future, and our lineup of new cars and crossovers are a great foundation for success," said Henderson. "The New GM is here to stay, and our brands position us to compete well in profitable segments with vehicles that are second-to-none."

 

GM also reaffirmed its commitment to improve the fuel efficiency of its vehicle fleet, meet or exceed new federal fuel economy and emissions regulations, and push ahead with advanced propulsion technology. GM will launch the Chevrolet Volt extended range electric vehicle in 2010, expects to have 14 hybrid models in production by 2012, and will have 65 percent of vehicles alternative-fuel capable by 2014.

 

"The New GM will become a long-term global leader in the development of fuel-efficient and advanced-technology vehicles," said Henderson. "In doing so, the New GM will contribute to the development of advanced engineering and manufacturing capabilities in the United States, which are critical to the future of the U.S. economy."

 

GM's primary bankruptcy counsel is Weil, Gotshal & Manges LLP. GM is also represented by Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as counsels. Cravath, Swaine, & Moore LLP is providing legal advice to the GM Board of Directors. GM's restructuring advisor is AP Services LLP and its financial advisors are Morgan Stanley, Evercore Partners and the Blackstone Group LLP.

 

About GM

General Motors Corp. (NYSE: GM), one of the world's largest automakers, was founded in 1908, and today manufactures cars and trucks in 34 countries. With its global headquarters in Detroit, GM employs 234,500 people in every major region of the world, and sells and services vehicles in some 140 countries. In 2008, GM sold 8.35 million cars and trucks globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, Hummer, Opel, Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's largest national market is the U.S., followed by China, Brazil, the United Kingdom, Canada, Russia and Germany. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services

 

This news release and management's comments on it contain "forward-looking statements." These statements are based on GM management's current expectations and assumptions, and as such involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those that we now anticipate -- both in connection with the Chapter 11 filings we are announcing today and GM's business and financial prospects. Those risks are described in GM's Annual Report on Form 10-K for the fiscal year ended December 31, 2008 which was filed March 5, 2009, GM's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2009 which was filed on May 8, 2009, GM's Current Report on Form 8-K filed on May 14, 2009 and other GM filings with the Securities and Exchange Commission.

Link to comment
Share on other sites

ugh, this makes me sick. My FI's dad works for GM and has been there 20+ years. He's a parts manager and makes 6 figures, he has a lot of health issues and is eligible for retirment in 2 years. We're hoping he can hold on that long sad.gif sad.gif sad.gif

 

my heart goes out to all GM employees.

Link to comment
Share on other sites

My dad, uncle, and a cousin all work for GM Ypsilanti. My cousin is out when they close next year, my uncle will hang on for a few months after the plant closes and my dad will be there for a few years.

 

My dad and uncle are Benefits Representatives, union appointees. My dad has the most seniority and he's going to stay as long as he can and my uncle will be needed for a few months after the plant closes. They handle retirements, unemployment issues, pay issues, handle concession questions, change health benefits recommend different benefit options...that kind of thing. GM keeps someone at the UAW office site for about 5 years after the closing of a plant so that's what my dad will be doing.

 

 

Josie - your future father in law will be fine. If where he works closes and he's that close to retirement, it's likely they'll offer early retirement to him.

Link to comment
Share on other sites

my future FIL is in a crazy position. He doesnt really work for 1 dealership he works for GM parts division and is assigned to a specific territory...he was just forced to sign a contract that they're reducing his pay and his employment is now on a month-to-month basis dependent upon what dealerships in his territory remain open.

 

I'll keep your family in my thoughts too, and wish them the best of luck!!! I hope people decide to buy american! I know I will in the future (ironic since i drive a camry!)

 

hang in there GM employees!

Link to comment
Share on other sites

Quote:
Originally Posted by JOSIE View Post
my future FIL is in a crazy position. He doesnt really work for 1 dealership he works for GM parts division and is assigned to a specific territory...he was just forced to sign a contract that they're reducing his pay and his employment is now on a month-to-month basis dependent upon what dealerships in his territory remain open.

I'll keep your family in my thoughts too, and wish them the best of luck!!! I hope people decide to buy american! I know I will in the future (ironic since i drive a camry!)

hang in there GM employees!
Ouch, that is rough!


All of my family is past their 30 years. My uncle has the most with 36 years, my dad has 35 and my cousin has 32. They are started working there at 18-20 years of age and are now in their 50s feeling like they're too young to retire.

GM/UAW offered a trades school or a few years. My uncle is a electrician by trade, my dad is a pipe fitter by trade - that's what they started out doing at GM. My dad got his HVAC license through the trade school and my stepmom (also a GM employee) got her real estate license. My dad and her buy houses on the side and flip them. My uncle does the electrical. They'll probably do that full time "after".
Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

 Share


  • Best Destination Wedding Sponsors



    Facebook Pinterest Google+ Twitter
  • Posts

    • The two people who matters the most in this situation? You and your partner. It is nice to get an outside opinion but if you have too much of it? It will get messy! I am replying you my response after that has happened to me with my wedding. Although it is quite hard, do not think of the negative opinions. The people who will turn up to your wedding? You will always cherish them even more! That is what has happened with me because my friendship with the people who attended my wedding has improved so much more that I know I can rely on them and they can rely on me. It is disappointing that people will not attend your wedding but it is their loss, not yours. At the end of the day, when they see pictures and videos of your big day they will definitely regret missing out on such event. I am waiting to deal with the aftermath of my wedding from my so called friends, if they say anything they will get an earful! Happy planning, your big day will be worth it! Keep us up to date!
    • PhotoBook Press specializes in the highest quality custom design and printing services, turning your favorite moments into works of art. We can transform your memories into custom pieces that speak volumes and will last a lifetime. We have a wide selection of template designs to allow you to select the right one that matches your preferences. You can personalize your wall, Christmas cards, or store your precious moments in softbook covers. Tell your story in whichever way you prefer. Work with Photobook Press today and enjoy up to 25% off. Visit PhotoBook Press custom design for personalized photo book, custom photo calendar, and custom printed wall art.
    • Wow, I cannot believe it's been over a year since I last posted! Better keep everyone up to date as everything ended up positive in the end! So, let's start with the situation with W. From my previous post, I have serious consideration removing him from the groomsmen because of the hurtful things he has said to me. Not too after my second post, I asked him once again whether he wants to be part of the groomsmen. The response was around the lines of "I need more solid information". This was before the restriction were lifted. Then he said it was down to finances yet again, even though he said he could have made it but because of what A said, W didn't commit no more. As W was being difficult, I decided to drop him as a groomsmen altogether and replaced him with someone else. Plan B was already in motion and tbh, I wish I did this first to avoid any hassle. Everyone who got invited in plan B all committed themselves to the wedding!  The situation with A is this. I was feeling sad that I was losing this friendship and that spark with him was gone. By the time it was gone, A was "ready" to meet up with me to discuss life and the wedding. When I said I lost spark with him, I really did. I knew that he was ready to meet up with me because it was convenient for him. For example, he wanted to meet up with me because he was driving past my house or was in the area visiting his relative. If he was not doing those things he would not want to meet up with me. Needless to say, every time he kept asking, I just said I was busy. I think deep down something was not right between me and A but he does not want to acknowledge it. I know that W had FOMO (Fear Of Missing Out) because that's what he is like. Around the end of last year, rather than messaging me about the DW he went behind my back and asked my SO. He was scared of asking me because he knows if he asked me, I would literally get angry at him. He's nosey and was happy enough to be part of the groomsmen but he listened to A. W didn't asked once but twice to mg SO. My SO just said that she was busy and should ask me about the wedding, not her. W did messagee but not about the wedding plans. I felt this was a sly move by his part. If anything not having A and W there was a blessing in disguise. I met up with the other 4 groomsmen over one weekend and it turns out it was the most fun we all have had for a while. It was as if we continued from the previous conversations in the past as if nothing has changed. I am so glad and proud of this group of groomsmen and glad the other 2 dropped out. The suit fitting went really well and we hung out again to see whether the suits altered fitted or not.  Unfortunately my SO UK group, 5 out of 6 declined the invite. Only 1 accepted it. The other 5 had reasons ranging from good ones to poorer ones 😅 As long one of them turned up then it was good enough for us. My SO's bridesmaids also were amazing. No problems caused whatsoever and they were really excited that our wedding was abroad too! To make things work out before our DW, myself and SO planned out 2 weekends for both groomsmen and bridesmaids to hang out before the DW. We did this so we would not encounter any awkwardness for the first time in DW. Lo and behold, everyone got to know each other and we really are happy that the wedding party weekend went smoothly. I will keep this ambiguous because I do not want A and his group finding out. I got married to my SO this year. What time and month? I will leave this intentionally blank. The wedding itself was everything we have expected. The wedding planner was amazing. The photographer was also amazing too, so glad we went for him. The sneak peak photos are absolutely great, couldn't imagine that the photos turned out like that. The good itself was okay could be better but could be worse. The first dance went relatively well although my SO managed to cock up s move which only I know hahahaha. The wedding ceremony itself went really quickly. I was a bag of nerves to which one of the groomsmen bought the groomsmen a shot each to calm everyone down. It did calm me down for a little bit but the nerves started again with the speeches. I got emotional throughout the speeches. I was not expecting the tear up with the best man speech at all. My speech was meant for my SO but for some reason everyone in the room also cried as well 😂 The all night dancing and fun was the best bit. When every serious part was done, I was able to stop being nervous! The fun went through the whole night and I can see everyone really enjoyed themselves. It was as if myself and SO correctly guess that lockdown restrictions would end. Everyone was thankful that they managed to take part in the DW because they all have been stranded in the country for 3 years! Do I regret having a DW? Hell no! Although it was a smaller party everything was all under control. Everyone had a great time!  More information about my UK group. Some of them congratulated us which was nice to hear. Those congratulated us, I can keep contact. They knew it was difficult coming to DW. At least they are mature enough to say something about it and they did not get the invite. On the other hand, A and W kept constantly monitoring my account for updates along with my SO. It got to the point that W really FOMO that he I followed our stories/posts. A on the other hand is completely out of order. He was invited to DW but made it really uncomfortable to me that he was not happy with DW. During that week, he went on holiday to Spain. I get that Spain is much more cheaper than my DW but it still is annoying. A also said before that he has a few weddings to attend during our DW month. He has not attended any weddings which makes me think that he has lied to me. A and W has lied to me saying it was costly for them to come to my DW. They have both bought PlayStation 5 and went to many designer outlets. If they are so stumped on money why go and buy things? It just shows that they are not good friends at all. Overall good DW. I do not regret it one bit because I know if I did it in the UK, the experience will be a lot different. The UK definitely not as scenic as my DW! 🤣    
    • Hi ! Myself and partner got engaged 7 months ago and we quite quickly asked our friends who we wanted in our wedding party (e.g bridesmaids, MOH and best men etc) who all agreed. After searching many English venues we have decided that we want to marry abroad, our dream is Mexico. We have been and priced this up today and we are incredibly happy. So we have put this forward to our friends and family who we really want there and now we are facing issues. My MOH and my partners Best man are together with a child, they now will not come unless we change to Spain or Greece. My brother, his wife and nephew can only come in one set week which isn't the time we want to marry and also will not come to Mexico. And both our Grandmother's won't come to Mexico.   What do we do? Do we carry on and go to Mexico with the people who will come or do we change our dreams and go to Spain or Greece?  Thoughts please, I'm getting to the point where I don't even want to marry as I'm fed up of friends and family ruining our ideas and dreams with their opinions. 
    • What purpose does a ring actually have? I think they look nice, but to me, wearing a ring doesn’t mean a damn thing. I’m engaged. I’m in a happy, healthy and strong relationship. And to be fully honest if you are ever in a relationship that you’d be willing to risk because of the price of an engagement ring, your partner could do better.
  • Topics

×
×
  • Create New...