How did General Motors Go Bankrupt

23 Мар 2014 | Author: | Комментарии к записи How did General Motors Go Bankrupt отключены
General Motors EV1

How did General Motors Go Bankrupt

Motors Corporation (GM) is an based in Detroit, U.S. In it was the world’s second largest in sales. For 77 consecutive years 2007), GM was the global sales It manufactures cars and trucks in 34 It had almost 2, 50,000 employees and has over 16 million cars in 140

GM had gotten US$15.4 billion as from the US Treasury Department the Troubled Assets Relief (TARP). On June1, 2009, Motors filed for a government-assisted 11 bankruptcy protection. It is the third bankruptcy filing of the world.

It was a series of missteps that led to bankruptcy and some of them are as GM offered too many incentives. the attacks in 2001, it offered 0% and later a rebate of $3000. To these high rebates, GM its sticker prices up not realizing it was injuring itself. Later GM give up its cash-back deals and low because competitors weren’t down on incentives either.

One mistake that GM made was to the program under which it an electric car, EV1. GM have taken the lead in car technology and been a part of the car movement.

For a long time, GMAC, financer, brought in more than its production processes. with a financial crunch in GM sold off 51% of GMAC to Cerberus for billion in cash and $6.6 over a period of time. no GMAC financing, 25% buyers get car loans from GMAC credit crunch.

It seemed like a brilliant when GM decided to by 20% of Fiat, in GM It would have made GM a powerful global corporation. Fiats CEO died suddenly problems.

According to the agreement, could force GM to buy all its shares. GM decided to pay $2 billion to move out of the On the other hand the irony is Fiat used that to pull through and is now going to be an of Chrysler.

During the 1990s, SUV were picking up. Seeing GM decided to diverse into SUV at the expense of its car production. By the time GM out with its SUVs in 2000, the SUV was already shrinking.


General Motors EV1

Given all of these reasons GM have filed for bankruptcy sooner when business was in 2005 because the world was still strong and could absorbed the crunch.

As of now GM is going to on its four key brands Chevrolet, Buick, and GMC. The U.S. is to acquire 60% stake in its equity. GM is set to receive $30 billion as further from the U.S.

Treasury Department. GM will bring down its breakeven from 16 million car sales to 10 and in doing so GM is expected to be debt by August. It was once said what’s good for GM is good for

The automaker giant will be back on its feet but on a smaller of operations focusing only on brands.

Prakriti Sharma

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General Motors EV1
General Motors EV1
General Motors EV1

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