General Motors is set to cut 47,000 jobs and plans to seek up to $30 billion aid and this move by GM is just another testament to how bad the future of General Motors look. It is also part of the plan of General Motors to idle five more US factories. All these moves are part of General Motors’ massive restructuring plan. The carmaker is the recipient of the $13.4 billion in federal loans and it plans to seek another $16.6 billion the moment the economic fails to get back on track. In a news report, it added that General Motors can achieve its profitability in two years time and can fully repay its loans by 2017. The company’s plan was submitted to the Obama administration for review. General Motors is also working to win concessions form United Auto Workers and the bond holders of the company in order to effectively re-size the company. The UAW also had talks with Chrysler LLC and Ford Motor Co. and said that it had reached a tentative deal on contract changes. Still based on reports, there are still discussions on how the companies will fund the union-run trust funds that will take the companies’ healthcare obligations for the retireees for next year. General Motors’ brand will be down to four last December- Chevy, Buick, Cadillac and GMC. And GMC is considering the sales of Hummer.
General Motors has reported that it has recieved $4 billion in low-interest loans coming from the federal government. For sure the infusion of fresh funds to the company will help GM address its financial issues. Chrysler LLC has also applied for the loans but they are still waiting for the approval of the loans since their application process has been slowed down for some reasons. The payment of $4 billion that the car company has received is just the first installment of the &9.4 billion in total loans that the company will get for January this year. And for Feebruary, the company is set to get another $4 bilion. This financial help that the company is getting for 2009 will be used to counter their billion dollar losses and their slowing sales. Chrysler is also expecting that they can get their $4 billion as soon as possible and they will use this as well to sustain their operations.
The Democrats have signaled the move to propose a bail-out plan designed for the automotive industry. And now that the US Senate is about to tackle the plan this Monday, the Big Three are lobbying hard to get a piece of the bail-out pie. The amount that they are after? It’s $25 billion, enough to save them from big problems. On November 7, General and Motors said that they lost money in the third quarter. General Motors, the largest automaker in the US right now said that it lost $2.5 billion and added that it canceled its move to acquire Chrysler LLC. Ford Motor Co is another loser in the industry as it posted a $129 million loss in the third quarter and added that it will slash another 2,260 jobs.