General Motors Declares Bankrupt

Posted In World - By NitiN Kumar Jain On Monday, June 1st, 2009 With 2 Comments






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General Motors has officially declared itself bankrupt – the largest bankruptcy filing by a US manufacturing company.

The 101-year old carmaker, once a symbol of America’s industrial prowess, has sought legal protection from its creditors after running up losses of $81bn (£50bn) over four years. Its bankruptcy petition has just been filed in a federal court in Manhattan, New York.

Until it was overtaken by Japanese rival Toyota last year, GM had been the world’s largest manufacturer of cars. But crippling employee pension and healthcare liabilities, and a failure to switch to making smaller, more fuel efficient vehicles, sealed its fate. It is the world’s third largest bankruptcy to date, after Lehman Brothers and telecoms firm Worldcom.

It is hoped that a streamlined “new GM” will emerge from bankruptcy by August.

GM, once the largest company in the world, has been losing market share since the early 1980s.

GM was also slow to move away from producing gas-guzzling SUVs when consumers were looking for more fuel-efficient vehicles.

See its dignity in pictures here

-NKJ

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