GM Bankruptcy Update; 363 Sale set for June 30th

[nsap]

GM Bankruptcy Update; 363 Sale set for June 30th
GMI hears the target date for a critical chapter of GM's bankruptcy.
www.gminsidenews.com
June 11, 2009
By: Nsap

In one of the largest industrial bankruptcies in U.S. history, General Motors has now been in court for just over ten days and overall things have been quiet about the progress of getting the General reorganized. GMI does have the latest information to come out of the bankruptcy hearings and the latest evolution of the bankruptcy plan; a plan that has not really changed much at all since the filing. Amongst the latest information, GMI has been told a critical date in the bankruptcy process.

One of the most critical processes of GM's bankruptcy proceedings is the final sale of "New GM" to the U.S Government. In this process creditors bid for New GM and it is expected, with little doubt, that the U.S. Government will issue the largest bid for New GM. The entire process is part of a 363 sale in the U.S. bankruptcy code. GMI has been told that sale could happen as early as June 30th. That date is contingent that no appeals or rejections are made to the process (which are looking likely), as such issues may delay the sale of New GM. Finalizing the actual sale does not mean New GM will be emerging from court on June 30th.

GMI has also been told that New GM's debt load after emerging from court will be around $9 Billion. $7.7 Billion of that to the U.S. Government to recover some of the TARP money issued to former General Motors and $1.3 Billion to the Canadian government for their loan contributions to General Motors while in bankruptcy. The remainder of GM's debt to the U.S. and Canadian governments will be (attempted to be) recovered through both governments having ownership stakes in the New GM. In addition to the $9 Billion, GM does expect to get CAFE loans from the Department of Energy once they emerge from bankruptcy, which will add to GM's debt load. All automakers can apply for CAFE loans and the money must be used toward the research and development of advanced technology vehicles to improve fuel efficiency.

As GMI has already reported, once New GM is stabilized and the government feels they can make a sufficient return on their investment, they will issue an Initial Public Offering (IPO) on New GM on the NYSE. GMI is hearing that the projection for the IPO is mid to late 2010. At that point government ownership of New GM will be dramatically reduced. During 2010 and 2011 New GM is expected to have a fairly sizable product offensive, mainly in small cars. The Chevrolet Spark, 2011 Chevrolet Aveo (Viva), Chevrolet Cruze, Chevrolet Volt, Chevrolet sub-compact crossover, Chevrolet MPV (Orlando-based), all-new Chevrolet Malibu, all-new Chevrolet Colorado, all-new GMC Canyon, 2011 Buick Regal and 2011 Cadillac CTS Coupe will all be launching in the 2010 to early 2011 time frame.

[Hurricane]

Originally Posted by nsap

During 2010 and 2011 New GM is expected to have a fairly sizable product offensive, mainly in small cars. The Chevrolet Spark, 2011 Chevrolet Aveo (Viva), Chevrolet Cruze, Chevrolet Volt, Chevrolet sub-compact crossover, Chevrolet MPV (Orlando-based), all-new Chevrolet Malibu, all-new Chevrolet Colorado, all-new GMC Canyon, 2011 Buick Regal and 2011 Cadillac CTS Coupe will all be launching in the 2010 to early 2011 time frame.

That is quite a lineup of small cars! I'm looking forward to seeing what the new Colorado and the Regal will look like...

With gas prices going up, it will be impressive to see the Spark next to the Aveo next to the Cruze next to the Volt sitting at dealerships. I hope they all sell well!

[Ultra Magnus]

So is it official that big cars are dead at GM? If thats the case I might as well go buy an Escalade just to rub it in the face of the eco-weenies. Seriously though, I applaud GM for the effort they have to put forth to come out of bankruptcy successfully and with a solid product portfolio, I just hope they don't abandon those of us who are in the market for larger cars. (And no the Malibu/lacrosse is not big enough. Think A8/7 Series/S class)

[neshapop]

Buick Regal 2011? Nice! Please be with 2.4 DI and Made in Oshawa and I will have my checkbook ready. Otherwise I will take CTS Wagon

[tamatt27]

So all signs point to the new GM being named...simply, New GM?

[oklapike]

Originally Posted by Ultra Magnus

So is it official that big cars are dead at GM? If thats the case I might as well go buy an Escalade just to rub it in the face of the eco-weenies. Seriously though, I applaud GM for the effort they have to put forth to come out of bankruptcy successfully and with a solid product portfolio, I just hope they don't abandon those of us who are in the market for larger cars. (And no the Malibu/lacrosse is not big enough. Think A8/7 Series/S class)

I wouldn't necessarily say that, the article just mentions what's going to be the product focus over the next few years. Besides, as long as Holden is part of the family, GM has a highly competitive large (115+ in wheelbase, 200+ in length) sedan platform to draw from.

[jaydee]

Orlando and new Malibu by early 2011? Nice. Also, what's this sub-compact crossover? Like an SX4? Does anyone else make a car in this class?

[osv_alero]

For those that love full-size vehicles; Ed stated, yesterday during a chat session, that an all new full-size Impala is due out shortly as well. We can all hope and dream for a RWD version. Maybe the ones from the Middle East.

[Buick61]

Isn't the next Malibu a '12 model? They're going to launch it in early '11?

[New_Mexico_Sunset_on_Rt66]

Good to hear that they will have a great lineup of small cars. Something which has been lacking.

Don't worry, I am confident we will still see larger cars in the stable as well. As well as a good interspersing of RWD performance.

Their products are already attracting attention, and real consideration. A young co-worker is looking for a small SUV and preferred the Traverse over the RAV-4. Hs is still shoppng, however. Yet that is refreshing to hear. Apparently the Kool-Aid is beginning to lose some sugar.

GM will need a good solid marketing campaign once this is all over to reassure the public. Otherwise the consumer will think that it is still going on. Something along the lines of, "We have emerged and are ready to serve you".

[1487]

what is the status of Impala replacement?

[jckjds]

I wish GM were working on an A class car, as well (i.e. a smart car competitor). I personally think that the smart car is extremely underwhelming, and ripe for a valid competitior. I mean, it's literally half of a compact car and it gets a measly 35 mpg +/- and costs $15k or more. With the Cruze set to get comparable mileage at a comparable price, I would think that GM could shoot for a 50 mpg A class car below $12K (maybe below $10K?). That would blow the doors off the Smart. I would

[-World Class-]

I hope we'll see a BAS+ Hybrid option on ALL of these cars (excluding the Volt of course).

Yay, Regal!

[nsap]

Originally Posted by jckjds

I wish GM were working on an A class car, as well (i.e. a smart car competitor). I personally think that the smart car is extremely underwhelming, and ripe for a valid competitior. I mean, it's literally half of a compact car and it gets a measly 35 mpg +/- and costs $15k or more. With the Cruze set to get comparable mileage at a comparable price, I would think that GM could shoot for a 50 mpg A class car below $12K (maybe below $10K?). That would blow the doors off the Smart. I would

The Spark is intended to be a Smart competitor.

[Eric77TA]

Originally Posted by Buick61

Isn't the next Malibu a '12 model? They're going to launch it in early '11?

The Camaro is a 2010 and was released in April of this year. So it would likely be a similar schedule for a '12 Malibu.