June 1st, 2009
03:52 PM ET

GM bankruptcy: End of an era

[cnn-photo-caption image=http://i2.cdn.turner.com/cnn/2008/POLITICS/12/22/poll.auto.bailout/art.gmflag.gi.jpg]

Chris Isidore
CNNMoney.com senior writer

General Motors filed for bankruptcy protection early Monday, a move once viewed as unthinkable that became inevitable after years of losses and market share declines capped by a dramatic plunge in sales in recent months.

The bankruptcy is likely to lead to major changes and job cuts at the battered automaker. But President Obama and GM CEO Fritz Henderson both promised that a more viable GM will emerge from bankruptcy.

In the end, even $19.4 billion in federal help wasn't enough to keep the nation's largest automaker out of bankruptcy. The government will pour another $30 billion into GM to fund operations during its reorganization.

Taxpayers will end up with a 60% stake in GM, with the union, its creditors and federal and provincial governments in Canada owning the remainder of the company.

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Filed under: 360° Radar • auto bailout
soundoff (26 Responses)
  1. Betsy Rose

    I would like to know what sacrifices the Obama's are making? Are they skipping one meal a day? Giving up going to the dentist or doctor? How about living in a tent city for awhile? We all have to sacrifice as the President says. Whats their sacrifices?

    June 2, 2009 at 3:34 am |
  2. Lilibeth

    What other industries will be affected by this bankruptcy?

    June 2, 2009 at 2:09 am |
  3. Lilibeth

    What other countries will be affected by this bankruptcy?

    June 2, 2009 at 2:08 am |
  4. Lilibeth

    What states will lose the most jobs?

    June 2, 2009 at 2:05 am |
  5. TheWizard

    Thank God for the bankruptcy! Hopefully we can now finally thank our government for doing something that will truly benefit our future. Perhaps now we will get ourselves off the oil and stop shipping our money to other countries to support terrorists who enjoy killing us because we're Americans. This is a win win situation for the U.S. economy. Now, if Americans start buying American cars we'll get back to basics, the way it used to be, taking care of each other! Sorry, not a question, just my opinion

    June 2, 2009 at 1:45 am |
  6. Imran O Kazmi

    I sent this to GM execs, NO ONE listened!!!

    Also http://sn2r.wordpress.com my open letter to President Obama on Auto plus other crisis.

    Seems like I don't have the bandwidth or influence to get heard despite relevance.

    June 2, 2009 at 12:33 am |
  7. dave

    I work for a auto company and It is good and bad for the company I work for. Good on the surface because our sales should increase but the bad is potential customers will not have jobs to furnish financial ability to purchase. Every other concern in America right now shouldn't be on bailouts, abortion, or isolated incedents which divert attention that should be given to the highest priority for America and I think every decision for bailouts and any financial transactions need a solid ground which is not throwing money at a problem that can't be solved by thowing money at it. Jobs in america and the economy should be the main focus for President Obama and the american government. Stop the political attack and allow political action the main focus point ONE PRIORITY @ A TIME MAIN PROBLEM FIRST.

    Thank you

    June 2, 2009 at 12:09 am |
  8. Erroll Callaway

    I wish that some one would (BAIL ME OUT)....(HELP).Actually I think that all this Bail Out Stuff is a BIG JOKE. Hey the Government can PRINT MONEY when it runs out...if we the People did that we would go to Prison.

    June 1, 2009 at 11:39 pm |
  9. daral

    why are we making this a political issue? this move is being made to help all citizens (democrats or republicans} alike. if this manufacturing giant fails it will be felt by everyone. let's give the President an opportunity to turn the economy around. it may seem like a lot of money to give GM but look at the money being spent to rebuild Iraq!

    June 1, 2009 at 11:27 pm |
  10. Louie

    Can I order my free cars online? What are the color choices besides green? Will they still smell like cheaply built US autos? I can hardly contain my excitement!

    June 1, 2009 at 11:14 pm |
  11. john berthelot

    Could you do a story covering today's enents (Mon.) in Washington &

    New York (Gen. Motors Hdq) on the Tues. Show.....................................

    I love the show (always)--------------–

    John Berthelot in New Orleans.....

    June 1, 2009 at 11:08 pm |
  12. Larry, Ohio

    Let's not forget the invaluable assistance afforded to Honda, Toyota, Nissan, V.W. etc. by the Governors of our great southern states who welcomed foreign manufacturing with open arms. They've done more to undercut American car makers, the U.S. economy, and American laborers than the foreign car companies could have ever dreamed of .
    The Governors who aided and abetted the destruction of the American auto industry with insane tax cuts, incentives, and non union labor, provided foreign manufacturers with the means to crush their competitors namely Ford, G.M., Chrysler, Jeep, Pontiac etc.. Well they not only sold out the big 3 but 3,000,000 American workers in thew process.
    Now that the global economy is in the tank which foreign car plants do you think will close first, that's right their foreign divisions, the ones in America. They really don't need us any more, any way.

    June 1, 2009 at 9:18 pm |
  13. Frank Malleaux

    My great grandfather was a journeyman toolmaker. According to his 1918 draft card was employed as an inspector at Chevrolet Motor Co. My Grandfather was an electrical engineer for Westinghouse. My father was a sales engineer at a local iron foundry where I grew up in Michigan. Before I became a teacher, I spent 11 years at Woodworth Co. of Detroit as a toolmaker. All of these occupations are directly or highly integrated with the automotive industry. I saw this automotive industry failure coming in the 1970's and decided to get out of industrial work. It took me ten years, a divorce, and I had to get out of Michigan in the process. I blame the state and federal politicians, especially the Michigan governors. I also blame big oil companies with their powerful political influence. My point is, this is a catastrophy which could have been avoided had we been oriented toward self sufficiency as a country. I have grave doubts using my tax dollars to bail out any of these incompetent companies and banks. I think we have mortgaged our children's and grandchildren's futures.

    June 1, 2009 at 9:12 pm |
  14. Bea

    'As goes GM, so goes the country'
    If GM is bankrupt, so is the US.
    Are we singing Dixie, riding in our Honda toward the cliff?

    June 1, 2009 at 8:53 pm |
  15. Charlie

    I thought all that bailout money was supose to save jobs. Where did it go ? Ohhhhhhh, I get now, management jobs that got themselves into the mess, not blue collar jobs. What was I thinking ? Baseball, apple pie, and who ? The Heartbeat of America they certainly aren't.

    June 1, 2009 at 7:56 pm |
  16. George Ian Reid

    We are not in a recession, we are in a Repression – Corporations are given taxpayer dollars to help fund them out of the mistakes they made with their decisions; Yet no help is given to the taxpayer who has had their access to credit restricted, mortgages foreclosed on, laid off from jobs. The taxpayer is the one who really has to pay for the bad, immoral and illegal decisions of the CEO's of the Banks and Car Companies !!! They are using our money to pay them their big bonuses, while they also refuse us credit, take away our jobs and kick us out of our homes.
    Repression is the key word here.

    June 1, 2009 at 7:25 pm |
  17. Jim

    If the Auto Industry wants to survive they need to go back into the pattent office & get the Info on the 100 mile per gallon carburators , I will never buy a new car for several reasons- 1. They cost TOO much,
    2. I drive a 1974 pickup- When they can make a Truck that can be worked on in the middle of nowhere,with out having to be a rocket scientist or a computer geek to do so, Does not cost more than $300,00 a year for insurance, & can go on mountain back roads & costs $600.00 I Might Consider it.
    3. Electric cars in the big city may be ok, but I live on the corner of Three hundreth & Plumb- 300 miles from the nearest Big City & Plumb out in the sticks.

    June 1, 2009 at 5:33 pm |
  18. Barbara Evans

    Will the consumers benefit by waiting to purchase 2009 models,
    also what about consumers that have already purchased models
    that will no longer be produced will they be able to get reliable maint.
    for those products and what about replacement parts?

    June 1, 2009 at 5:21 pm |
  19. Doug Dikun

    I actually purchase my GM vehicle based on the reputation of the dealer's service department. Sales and Service go hand in hand. What is GM goiing to do about its dealer managed "under performing" service departments? Sales gets the customer and Service keeps them and gets them to come back. I live in the Chicagoland area and GM Service Shops in my area are terrible despite what they say. Is GM going to clamp down on that aspect too?

    June 1, 2009 at 4:59 pm |
  20. Mike Port Tobacco, Md

    Months ago, before receiving taxpayer money, it was inevitable that GM was going to fail, why didn’t they file bankruptcy then?

    American taxpayers loaned GM billions of dollars prior to today's bankruptcy filing, where did all of that money go?

    June 1, 2009 at 4:53 pm |
  21. Tim Gibson

    To big to fail, or just to big to fail without first being allowed into the cookie jar of taxpayer funds, but hey, stake in a failed company is a good thing right.

    I would think that the American Band-aide store would have nothing but empty shelves for bandage supplies could be found. Opps forgot, that is only for the every day kind of person.

    June 1, 2009 at 4:50 pm |
  22. David Davey

    Drop the vehicle prices to meet the gloomy economy and more people would make auto purchases. 30 to 40 thousand dollars for a auto is ludicrous!

    June 1, 2009 at 4:39 pm |
  23. David Davey

    Drop the vehicle prices to meet the gloomy economy and more people would make auto purchases. #0 to 40 thousand dollars for a auto is ludicrous!

    June 1, 2009 at 4:38 pm |
  24. Isabel, Brazil

    According President Obama the GM will strengthen the process of composition. So is the end of an era for the beginning of another era, where the company will be modernizing, will be sustainable and environmentally correct.

    June 1, 2009 at 4:27 pm |
  25. Rendell

    Instead of giving out billions and billions of dollars, why doesnt the government give that money to the American people in forms of coupons to go out and purchase a newer fuel efficient car? Not only would that help the environment, but the money would still be coming from the government and going to the auto makers and would put more people back to work.

    June 1, 2009 at 4:25 pm |
  26. Ari Vafaei

    I have had a GM credit card for over six years and have accumulated cash points towards purchasing a GM car. My question is, now that GM has filed for bankruptcy, what is going to happen to my points?

    June 1, 2009 at 4:09 pm |