As has long been expected, General Motors (GM) filed for Chapter 11 bankruptcy protection on Monday morning.
The struggling automaker employs 235,000 people worldwide and saw its stock price fall below $1 last week in advance of the news.
"GM going through bankruptcy is a very positive thing for the auto industry. They should emerge as a reasonable competitor. The only thing that’s been holding GM back is labor contracts and relationships with debtors and franchisees. All that should be cleansed in a bankruptcy," Len Blum of Westwood Capital was quoted as saying in a Bloomberg News report.
Bloomberg noted that GM has lost about $88 billion since 2004 and that it and its most valuable assets are expected to be largely government-owned during the bankruptcy process.
According to a New York Times report, the company said in its bankruptcy filing that it has $82.3 billion in assets and $172.8 billion in liabilities.
The news means that in the last month, two of the "Big Three" U.S. automakers have declared bankruptcy, with Chrysler having done so at the end of April.
No comments:
Post a Comment