Turnaround At GM is daunting ..
If they and TOVC are trying to
figure out how to get our solutions in their vehicles-
why wait til things get worse..?? That strategy hasn't served them too well..
Here is another point of view:
( source MSN)
Should GM just file for bankruptcy?
Posted Nov 11 2008, 02:29 PM by Kim Peterson Rating: Filed under: GM, Kim Peterson
A Deutsche Bank analyst gave General Motors' stock a price target of zero. Even if the company averts bankruptcy, Rod Lache noted, its future is likely to be "bankruptcy-like."
Meanwhile, hedge fund manager Bill Ackman says GM would be better off filing for bankruptcy instead of taking government bailout money.
"It has been hamstrung for years because it has too much debt and it has contracts that are uneconomic," he said on The Charlie Rose Show, according to Bloomberg. "The way to solve that problem is not to lend more money. They should do prepackaged bankruptcy."
GM needs to get out from its debt, and bankruptcy allows it to seek protection from creditors while continuing to operate, he said. GM executives have ruled out bankruptcy, opting to ask for federal aid.
Shares of GM dropped 15% to hit a 65-year-low today as investors reacted to news that the company's liqudiity would be just barely enough to run its business through the rest of this year. Liquidity will fall below minimum levels needed next year.
Still, JPMorgan analysts recently rated GM's bonds a "buy," saying that GM has several options to improve its bottom line.
"We believe GM has several sources of liquidity it can access to bridge the company to 2010 when it realizes considerable cost cuts," the analysts said in a report. Those sources include government loans, cost cuts and raiding GM's overfunded pension plan.
