It was only a short while ago that former GM CEO Rick Wagoner hopped on a corporate jet and went hat in hand before D.C. legislators. His pitch: a Chapter 11 filing was unthinkable. You might as well turn out the lights in Detroit.
Untold hardship and misery were predicted for the Midwest manufacturing belt if the country’s No. 1 carmaker went under. In short, GM was too big to fail. [A line also used to prop up Citigroup and its financial ilk.] Rick was skewered.
Fast forward to today. GM's bankruptcy, of late, was seen as a foregone conclusion. The feds, which booted Wagoner in March, set June 1 as D-Day (or B-Day) for the automaker.
There was some drama as bondholders scratched and clawed for every penny they felt due them. Harsh reality: the American public, which already tossed the United Auto Workers overboard, wasn't going to rally around the stirring calls for bondholder rights, no matter how hard editorialists at the Wall Street Journal pressed the issue. Let them eat cake, indeed.
GM's official belly-up filing was a non-story.
The press release issued today by GM reads more like one heralding a high-tech start-up then the demise of a 120-year industrial icon.
“Reinvention” is touted. A leaner, stronger “New GM” positioned for a profitable, self-sustaining and competitive future is promised.
CEO Fritz Henderson apparently is chomping at the bit, ready to take on the world once the court gives it blessing. [Note to Fritz, it's tough out there, even with Uncle Sam as co-driver. ]
The term "Chapter 11" isn’t even mentioned until the fourth paragraph of the body of the text. GM is to be unfettered by the evil constraints of the "Old GM," though the "Old GM" includes parts such as Pontiac and Saturn, which until recently were not too shabby brands.
In any case, hats off for the soft landing into Chapter 11! [A similar tip of the derby goes to the gang at Chrysler, though No. 3 is going to the Italians.] Best of luck to the thousands of workers who lost jobs because of the brutal mismanagement of GM and to the suppliers that will follow GM into Chapter 11.
You can bet those suppliers will have a tougher time of it in Chapter 11 than GM.
(Image via CEOworld.biz)