WORLD> America
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WORLD> America
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CEO vows better performance as GM exits bankruptcy
(Agencies)
Updated: 2009-07-11 05:59 GM, in a viability plan presented to the government, said it would break even before interest and taxes next year, and be slightly above break-even for 2011 on a pretax basis. "Sitting here today, I don't have any reason to disbelieve those numbers," Henderson said, giving no details of when the company would make a net profit. The company's logo will remain blue with white underlined GM letters, although the company had considered changing the background to green to symbolize an environmental focus. GM has no plans to change the background, Henderson said. He said the U.S. government, which owns a majority stake in GM, has vowed that it would not get involved in day-to-day decisions. The Treasury Department released a statement Friday afternoon crediting GM's restructuring with saving both the automaker and "tens of thousands" of American jobs. "The hard work of charting a path to viability now rests with GM's board and management," Treasury said in its statement. "But we are confident that we remain on track to ultimately see returns on these taxpayer investments." GM received $19 billion to $20 billion more in federal aid on Friday, the remainder of the $50 billion it will receive, Henderson said. A large part of the money will be held in escrow. Turning a profit will not be easy. GM has piled up losses and survives only because of government loans. Besides the U.S. government's 61 percent controlling interest, the United Auto Workers union gets a 17.5 percent stake of the company through its retiree health care trust, and the Canadian government will control 11.7 percent. The remaining shares went to bondholders of the old company. Concessions made by the United Auto Workers union just before the company entered bankruptcy protection have brought GM's labor costs down to where they are fully competitive with Toyota Motor Corp., Henderson said. The parts of GM not moving to the new company will become part of "old GM," a collection of assets and liabilities that will be sold to pay creditors.
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