General Motors (GM) will cut a number of brands and nameplates in the US in the procedure, known as Chapter 11.
A new company called New GM will come out of the measure with the ability to be profitable on sales of 10 million vehicles a year. GM has been making massive losses on sales that last year were 16 million.
The surviving brands will be Chevrolet, Cadillac, Buick and GMC. Current GM operations outside the US are not affected by the process.
Meanwhile, General Motors Europe has secured approval for a €1.5 billion bridge financing agreement with the German government based on the partnership with Magna, which will allow sufficient time to finalize the partnership agreement. With this available financing, the European operations are isolated from any financial impact by GM’s situation in the US.
Opel/Vauxhall assets have been pooled under Adam Opel GmbH, with the majority of the shares of Adam Opel GmbH being put into an independent trust (the balance to remain with General Motors), while final negotiations with Magna proceed.
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