According to the Detroit Free Press, General Motors interim chairman, Kent Kresa, has been asked by president Obama's administration to replenish the automaker's board with fresh blood. Kresa said that while the board did achieve "historic things" recently, like renegotiating the UAW pay scale, he also said that the board didn't fully comprehend the magnitude of the downturn.
GM's most recent offer to its bondholders offered a little bit of cash and a little bit of equity. GM CEO Fritz Henderson's example was that a holder of $1,000 in bonds would end up with $333 and a some equity. After conferring with the Auto Task Force, however, that offer was deemed excessive in light of GM's situation so a new deal is being readied for bondholder approval.
Click above for a high res gallery of the 2011 Chevy Volt
Click above for a high res gallery of the 2011 Chevy Volt
Click above for high-res image gallery of the 2011 Chevy Volt
GM and Chrysler have until Tuesday to complete the financial restructuring demanded by the government under the terms of the bridge loans. It is unlikely that they will make that target. The sticking point for GM is unwillingness on the part of bondholders to agree to what's being asked: GM needs to transform $27 billion of debt into liquidity, and that means a serious dilution of bondholder equity.
Curious what it takes to be a member of the recently-created Auto Task Force? Thanks to an email sent out by Harry J. Wilson, a newly-hired Task Force worker, there's no need to wonder. Some knowledge of the auto industry would reportedly be helpful, though prospective applicants and their family members cannot currently own any stock in the Detroit automakers or serve on any of the D-3's boards of directors. Would-be applicants would also need to be "sufficiently intellectually and professional
Now that President Obama had appointed the task force that will study the future of the auto industry in this country, its time for them to get to work. The team spent last week looking over the latest viability plans from General Motors and Chrysler. Today, Steven Rattner and Ron Bloom, advisers to the task force will come to Michigan where they will sit down with officials at both GM and Chrysler to discuss the plans and learn more about both company's future product directions. While they are
