GM mulls axing brands for bailout billions
27 Nov 2008
It could be curtains for some of GMs best known brands as the troubled automaker weighs options to prepare turnaround plans to secure billions in loans from the US government.
Federal lawmakers, last week, turned down pleas from GM, Ford Motor Co and Chrysler LLC for $25 billion of loans. The automakers were asked to submit detailed turnaround plans to be reviewed by Congress on December 8.
Before the US economy crashed this year, the companies were losing cash even as they were restructuring to bring production capacity – and workforce levels in line with demand. They were also gearing up to transition from their line up of pick-up trucks and SUVs to more fuel-efficient cars. The pick-up trucks and SUVs had contributed hugely to the profits in the 1990s.
Critics have long been pressing for a more disciplined approach from the automakers toward the bottom line. They have also been demanding that the automakers pare their offerings for trimming as GM did with phasing out Oldsmobile in 2000.
There is a lot of speculation on how the big three are planning to bring about a turnaround, industry officials are tight-lipped and refuse to comment on it. They say they are not going to say anything in advance of the plan.
It could be curtains for some of GMs best known brands as the troubled automaker weighs options to prepare turnaround plans to secure billions in loans from the US government.
