Even if GM implements the planned operating actions that are substantially within its control, GM’s estimated liquidity during the remainder of 2008 will approach the minimum amount necessary to operate its business. Looking into the first two quarters of 2009, even with its planned actions, the company’s estimated liquidity will fall significantly short of that amount unless economic and automotive industry conditions significantly improve, it receives substantial proceeds from asset sales, takes more aggressive working capital initiatives, gains access to capital markets and other private sources of funding, receives government funding under one or more current or future programs, or some combination of the foregoing.
When does it end?
Bear Stearns: See ya. Lehman Brothers: Game Over. Washington Mutual: Adios. Wachovia: Sayonara. AIG: I.O.U.
And now General Motors (“What is good for the country is good for General Motors, and what is good for General Motors is good for the country”) stands on the brink of collapse.
The situation is extremely dire. They have $16 billion in cash on hand. They burned through $7 billion last quarter – though they say that was an aberration due to one time events. They owe $43 billion and have massive pension and other retirement obligations. North American car sales dropped 45% in October from the year ago period.
If you read between the lines, it seems like either the government props them up or they go under.
Living history, baby.