No one thinks Mr. Obama is going to allow G.M. to be broken up, its assets sold or abandoned.
But if the Chrysler legal process unfolds as the White House hopes it will in coming weeks, the bankruptcy option may look increasingly attractive for G.M. as well, officials on Mr. Obama’s automotive task force said. Bankruptcy may also be the only way to force the kind of paring down that Chrysler, with a third of G.M.’s workers and half the number of plants, did not have to endure.“The threat of bankruptcy is very important in the negotiations with the bondholders and the dealers and others,” said David E. Cole, chairman of the Center for Automotive Research in Ann Arbor, Mich. “Without a clear and present danger to them, they won’t make a reasonable deal.”
Sunday, May 3, 2009
G.M. Bankruptcy More Likely Now?
The Chrysler bankruptcy may make it a more appealing option for President Obama as he attempts to reform G.M., according to The New York Times: