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GM open to HQ move as bankruptcy risk looms
May 11, 2009 - 1:01 pm ET
DETROIT (Reuters) - General Motors is open to considering moving its headquarters from Detroit, selling U.S. plants and renegotiating its restructuring plan with its major union as it heads toward probable bankruptcy, CEO Fritz Henderson said today.
Henderson said it was more likely that GM was headed for bankruptcy by June 1 -- the U.S. government-imposed deadline for the automaker to restructure or face bankruptcy.
"It's more probable that we would need to accomplish our goals in a bankruptcy," Henderson said on a conference call with reporters. "There's still a chance for it to be done outside a court proceeding."
A move by GM to leave Detroit would represent another blow for the economy of a region already reeling from the bankruptcy of Chrysler LLC and the sharp downturn in auto manufacturing.
GM purchased its glass-towered headquarters building, known as Detroit's Renaissance Center, last year for $625 million. The 100-year-old automaker has been based there since 1996.
"As we look at the structure, look at the business, we're looking at everything, particularly as we slim down," Henderson said. "At this point, I don't have anything to report. We don't have any such plans, but if we did it would be motivated by business rationale, which would be cost-efficiency and speed."
GM needs to reach deals that would slash debt owed to bondholders and the UAW and to win concessions from the union that would cut operating costs for its remaining U.S. plants by the end of this month under terms set by the Obama administration's autos task force.
It has already told bondholders that it would miss a $1 billion June 1 debt payment.
The automaker has also restarted talks with the Canadian Auto Workers union just after that union agreed to a set of sweeping concessions to keep Chrysler from liquidation.
The UAW, which is crucial to GM's turnaround plans since it is also a major creditor, has raised strong objections to GM's plans to increase vehicle imports from plants in Mexico and Korea, saying that runs against the job-saving intent of the U.S. government's support for the automaker.
GM's current restructuring plan, which is supported by the U.S. autos task force headed by former investment banker Steve Rattner, would cut about 21,000 more U.S. factory jobs.
But Henderson said GM was ready to negotiate everything with the UAW in talks now under way.
May 11, 2009 - 1:01 pm ET
DETROIT (Reuters) - General Motors is open to considering moving its headquarters from Detroit, selling U.S. plants and renegotiating its restructuring plan with its major union as it heads toward probable bankruptcy, CEO Fritz Henderson said today.
Henderson said it was more likely that GM was headed for bankruptcy by June 1 -- the U.S. government-imposed deadline for the automaker to restructure or face bankruptcy.
"It's more probable that we would need to accomplish our goals in a bankruptcy," Henderson said on a conference call with reporters. "There's still a chance for it to be done outside a court proceeding."
A move by GM to leave Detroit would represent another blow for the economy of a region already reeling from the bankruptcy of Chrysler LLC and the sharp downturn in auto manufacturing.
GM purchased its glass-towered headquarters building, known as Detroit's Renaissance Center, last year for $625 million. The 100-year-old automaker has been based there since 1996.
"As we look at the structure, look at the business, we're looking at everything, particularly as we slim down," Henderson said. "At this point, I don't have anything to report. We don't have any such plans, but if we did it would be motivated by business rationale, which would be cost-efficiency and speed."
GM needs to reach deals that would slash debt owed to bondholders and the UAW and to win concessions from the union that would cut operating costs for its remaining U.S. plants by the end of this month under terms set by the Obama administration's autos task force.
It has already told bondholders that it would miss a $1 billion June 1 debt payment.
The automaker has also restarted talks with the Canadian Auto Workers union just after that union agreed to a set of sweeping concessions to keep Chrysler from liquidation.
The UAW, which is crucial to GM's turnaround plans since it is also a major creditor, has raised strong objections to GM's plans to increase vehicle imports from plants in Mexico and Korea, saying that runs against the job-saving intent of the U.S. government's support for the automaker.
GM's current restructuring plan, which is supported by the U.S. autos task force headed by former investment banker Steve Rattner, would cut about 21,000 more U.S. factory jobs.
But Henderson said GM was ready to negotiate everything with the UAW in talks now under way.
