Make / Model Search

News - General Motors

Official: GM takes Chapter 11

Tough decisions: GM chief Fritz Henderson announced the Chapter 11 application last night.

Holden ‘not impacted’ by GM bankruptcy filing in US

2 Jun 2009

GENERAL Motors has filed for Chapter 11 bankruptcy as widely anticipated, listing debts of $US172 billion ($A212 billion).

But GM Holden says the move will have no direct impact on its Australian design, engineering and manufacturing operations, and no local jobs will be lost.

Holden also says it will be part of the “New GM” – the post-bankruptcy company that is expected to emerge with the aid of $US15 billion bankruptcy financing from the US government.

In the US, GM’s bankruptcy filing came on the same day as a US bankruptcy judge approved the sale of most of Chrysler’s assets to a group led by Fiat SpA (see separate story).

While the GM restructuring makes the US government the biggest shareholder under a debt-for-equity arrangement, President Obama said GM executives would be left to run the company that will emerge from bankruptcy in 60 to 90 days.

 center imageGM Holden's Mark Reuss.

"Our goal is to get GM back on its feet, take a hands-off approach and get out quickly," he said in a televised announcement.

The bankruptcy filing – announced by GM CEO Fritz Henderson in New York overnight – is the largest by a manufacturing company in US history.

GM said it would not rush into dealership terminations under bankruptcy protection, instead sticking with the 18-month grace period for dealers who have already received termination letters.

It also has identified 14 plants to be closed or idled in North America, including four assembly plants.

In Australia, Holden chairman and managing director Mark Reuss said that all GM business in Asia-Pacific – including GM Holden – would not be directly affected by the bankruptcy filing in the US Federal Court.

“Holden is a subsidiary of GM, but we are a corporate entity in our own right – an independent company under Australian law,” he said.

“Beyond that, Holden will be an important part of the New GM.”

Read more:

GM bankruptcy D-day tonight

GM gets another $US4 billion

GM Holden should be safe, says Reuss

The Road to Recovery podcast series

Click to share

Click below to follow us on
Facebook  Twitter  Instagram

General Motors articles

Motor industry news

GoAutoNews is Australia’s number one automotive industry journal covering the latest news, future and new model releases, market trends, industry personnel movements, and international events.

Catch up on all of the latest industry news with this week's edition of GoAutoNews
Click here