GM files Chapter 11 bankruptcy announces shuttering factories!

General Motors files Chapter 11 bankruptcy protection in court and will close 9 plants.

New York, NY(JusticeNewsFlash.com)–The world’s second-largest auto maker, General Motors (GM), filed for Chapter 11 bankruptcy protection early Monday morning. Yahoo News reports that GM’s bankruptcy case is the largest U.S. industrial bankruptcy filing, with $82.29 billion in assets and $172.81 billion in debt. Chapter 11 will aide GM in downsizing its current operations by selling assets, clearing liabilities, and restructuring the big automakers debt. The Obama administration stated the government will continue its efforts to support GM, by offering $30 billion in financing. In exchange, the government will own 60% of equity in the company. Canada has a 12.5% ownership stake in return for the $9.5 billion in government assistance Canada gave to GM. The United Auto Workers (UAW) union will have a 17.5% share, leaving 10% to unsecured bondholders.

Business litigation lawyers assert if the bankruptcy process is successful, General Motors will become a smaller company, with fewer plants, employees, and workers. GM has already announced to the public that it plans to permanently close down nine auto manufacturing plants, and leave three other plants idle. This corporate action by the big auto makers will cause a 34% reduction in GM’s work force, cutting approximately 21,000 employees. GM also plans to eliminate 2,600 of its automobile dealers. General Motors reassures customers the warranty on their motor vehicles will continue to be honored. The U.S. government states pension funds and health care benefits of employees should go on uninterrupted. GM will continue production throughout the bankruptcy process.

JusticeNewsFlash.com news for New York business litigation lawyers.

It's only fair to share...Pin on PinterestTweet about this on TwitterShare on LinkedInShare on Google+Share on FacebookEmail this to someonePrint this page

About the Author Justice Seeker

Heather L. Ryan, R.N., C.L.N.C- Heather Ryan is a Certified Legal Nurse Consultant with 15 years of experience in the health care industry. Her expertise in reviewing medical records and assisting lawyers with the determination as to whether legal action should be taken provides an invaluable asset to the newsroom. Medical-malpractice, products liability, personal injury and workers’ compensation are some of the recent areas of litigation Ms. Ryan has focused her efforts on. A member of the Florida Justice Association, Heather maintains a long list of certifications and credentials to support her areas of expertise and stays up-to-date with her clinical knowledge working as an emergency room/trauma nurse, at a Level 1, Adult/Pediatric trauma and teaching institution in South Florida.