General Motors Unveils Restructuring Plan

GM has submitted its restructuring plans to the US Congress and has made a summary publicly available on its press site.

GM has not committed to outright eliminating any brands like Saturn or Pontiac - something many analysts say it must do in order to survive. It has said it will "focus" on "four core brands" - Chevrolet, Cadillac, GMC and Buick.

But GM is claiming that it is looking for a buyer for Saab and has put the Hummer brand up for sale. Pontiac will be shrunk to a few niche products and GM is "exploring alternatives" for the Saturn brand - hinting that the brand may just be axed.

GM, like Ford, has also said it will accelerate the development of greener cars and highlighted the Chevy Volt, which can go 40 miles solely on electric power and is scheduled to go into production in 2010, as one of the models it is staking its future on.

The company will also cut costs by reducing production and its work force and working with the UAW to revise labor agreements and get further concessions on compensation from its workers.

GM says it needs 12 billion US dollars to see it through 2009, based on a domestic market of 12 million vehicle sales in the US. The company claims it will need an additional 6 billion if market conditions are worse than that and sales fall to around 10.5 million.

According to the plan, GM will pay back the loans in 2012 and will be profitable after restructuring, predicated on a US market of 12 to 13 million vehicles. The US market over the last several years has hovered at around 17 million units, but vehicle sales have fallen off precipitously over the last year. GM's domestic sales fell 45 percent in October over the same month last year. For November, they were down more than 41 percent.

But it remains to be seen whether this plan will be enough for GM to secure any federal funds. Some lawmakers in the US are skeptical of an auto industry bailout and question whether GM or the other Big 3 are really willing to do what it takes to become competitive businesses again. "Throwing good money after bad" has become one of the most frequently utilized expressions on Capitol Hill these days.