irreality

As the Tuesday deadline for submission of a restructuring plan draws closer, unnamed sources close to GM told the Wall Street Journal that one General Motors plan includes a Chapter 11 bankruptcy filing that would create a new company.

“One plan includes a Chapter 11 filing that would assemble all of GM’s viable assets, including some U.S. brands and international operations, into a new company,” the newspaper said. “The undesirable assets would be liquidated or sold under protection of a bankruptcy court. Contracts with bondholders, unions, dealers and suppliers would also be reworked.”

Citing “people familiar with the matter,” the story said that GM could also ask for additional government funds to stave off a bankruptcy filing.

GM has declined to comment at this time, but has already announced layoffs of nearly 15% of company employees, and pay cuts for those remaining.  This is not the first time that of Chapter 11 has been mentioned here, but with restructuring negotiations between bondholders and the UAW unlikely to end before the deadline, GM is likely running out of time.