Bankruptcy General Motors (GM’s) Best Option while Ford survives

By: Peter Chubb | Posted: April 25, 2009 | No Comments
Filed under: Autos

As we know the Treasury Dept. is now in the process of directing Chrysler to prepare for bankruptcy, and this could now scare General Motors (NYSE:GM) into cutting a deal as well. If bondholders do not reach an agreement, then the U.S. Treasury Dept.’s auto task force and GM would likely see bankruptcy as its best option. So we could see two of the largest automakers in the United States go under while Ford Motor Company (NYSE:F) would survive.

Michael Robinet, vice-president of CSM Worldwide has been talking to Business Week, he told them that this could be the only way for the government to reach its goal and remove most of the $28 billion in bond debt. GM wishes for the bondholders to take most of their debt in stock.

Things are a little different for Ford, as its loss for the first quarter was lower than expected. CNN Money reports that Ford’s CEO is confident that the company would not need any sort of bailout from the U.S. Treasury Dept, which is keeping its rivals GM and Chrysler alive.

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