Chapter 11 protection might be useful for service businesses like airlines or noncomplex manufacturers like steelmakers, but it's difficult to see how it could work for an automaker, where wide, deep, and intricate financial links run both upstream (e.g., suppliers) and downstream (e.g., dealers) from the core enterprise. If GM were to file for Chapter 11 protection, the consequences would likely be catastrophic for the highly interconnected U.S. auto industry, affecting the viability of companies that might also supply parts, components, and materials to the likes of Ford and Toyota.
And then there's this: Chapter 11 allows companies to reorganize and trade out of their difficulties. We've all flown on bankrupt airlines. But would you buy a car or truck from a bankrupt automaker?
MOTORTREND BLOG-
I dont know Im not convinced bankruptcy isnt an option. Why cant all parties that are reliant on the industry make certain sacrifices in the name of survival?The UAW,parts suppliers and dealers? It seems a better option than throwing money at the problem. Maybe we should see if thier "plan" has any "meat" to it and go from there.
The biggest obstacle I see them having to overcome if they file chapter11 is buyer confidence. Can you sell cars that people will rely on warranties if the company is technically bankrupt? I dont know but that is the ONLY aspect of bankruptcy that seems to be a real problem. Could the government participate in guarantees on warranties instead of handing over cash? Oldsmobile went down a few years back and buyer confidence was low because of the warranty factor so GM made a massive ad campaign to reassure owners that GM would back Oldsmobiles.Could the government instill such confidence?
Lets discuss......
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Galsbury_Doughboy
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mpvan
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wood-cutter
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wood-cutter
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ProfPalmer
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wood-cutter
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mnaines
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mnaines
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mnaines
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mnaines
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mnaines
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mnaines
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mnaines
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mnaines
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mnaines
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mnaines
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mnaines
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mnaines
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wood-cutter
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JewwellsP
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