The two former US automaker giants General Motors and Chrysler are facing a choice between submitting a viable plan of action or filing for controlled bankruptcy. A declaration of bankruptcy is the fastest method for restructuring, according to US President Barack Obama, as much as it is a ‘legal tool to end the debate.’ General Motors will have 60 days and Chrysler has 30 days to restructure and implement radical changes so as to avert bankruptcy.
Obama said that General Motors and Chrysler are restructuring not ‘fast enough.’ So, he gave them a ‘limited time’ to solve their problems. Obama also said proudly that General Motors and Chrysler are ‘emblems and symbols of the United States of the twentieth century.’ The president laments that it is unfortunate that the survival of these companies ‘cannot depend on taxpayer dollars.’ “They must fend for themselves,” he added.
Justifying the limited time that he gave in which both companies can negotiate with shareholders, unions, and suppliers, among others, Obama noted that these companies have submitted a plan but neither has done enough.
Regarding the resignation of General Motors’ Chairman and CEO Rick Wagoner under the alleged pressure from the White House, Obama has acknowledged his lifetime dedication but added that it is time for a new vision at the top of the car manufacturer.
The U.S. president firmly advocates for the United States to regain its leadership in the car manufacturing industry. He calls for the development of technology to avoid dependence on oil and to surpass the sales of the more efficient vehicles in Europe.
The ultimatum from the White House and the threat of bankruptcy of these historic companies have led to the collapse of the automotive sector on Wall Street. The US federal government has been bailing out the US auto industry, particularly the Big Three.
