GM, Chrysler Race To Finish Plans For Public Release Late Tuesday
February 17 2009 - 10:41AM
Dow Jones News
General Motors Corp. (GM) expects to release a
government-mandated recovery plan to the public after 6 p.m. on
Tuesday, though the report might not include critical concessions
from the company's labor unions and bond holders.
Chrysler LLC is working on a similar disclosure.
The two auto makers, surviving on $17.4 billion in federal aid,
are required to submit detailed restructuring plans to the U.S.
Treasury on Tuesday as a condition of the loans.
GM shares were down 14.8%, or 37 cents, to $2.13 in morning
trading. The auto maker's stock has lost more than 90% of its value
in the last year.
At GM, overnight negotiations with the United Auto Workers
failed to produce a deal that would substantially cut labor costs,
sources familiar with the talks said. Bargaining remained underway
Tuesday morning.
The auto maker also is working to convince bond holders and
other creditors to accept terms that will reduce its substantial
debt.
GM said it will submit its restructuring plan regardless of
whether is succeeds in cutting deals with the union or
bondholders.
GM's plan, an 800- to 900-page report that explains how the auto
maker can turn around operations that have lost more than $70
billion since 2004, is expected to detail plant closings, plans to
eliminate models and brands and to further reduce structural
costs.
UAW negotiations hinge on GM's efforts to change terms under
which it pays the union to assume responsibility for billions in
retiree medical costs.
The two sides made progress over the holiday weekend but were
still hammering out significant differences, according to people
familiar with the talks.
Ford Motor Co. (F) did not ask for government aid, though the
auto maker is likely to seek concessions in line with what GM and
Chrysler win.
-By Sharon Terlep; 248-204-5532; sharon.terlep@dowjones.com.