It is commonly known that General Motors is one of the three American car manufacturers. Along with the rising gas prices came the need for the public to purchase more fuel efficient vehicles. Now, GM finds themselves in a grim financial situation. It has been said that if the company stays on the path it is currently on, that it will not survive.
It has further been said that even with the help of the United States government that the GM financial situation could cause events that would be like bankruptcy. General Motors has been known as one of the world’s biggest auto manufacturers, being a leader in sales for 76 years. In the July 2008, GM's sales in the United States fell 20 percent. Then, they announced that they would have some plants at a stand still as a way of trying to deal with the shrinkage of sales. While they had idle plants, they were also increasing the shifts as a way of trying to produce enough of the smaller more efficient cars.
Gas prices and the bad state of the stock market caused General Motors in September 2008 to go to Washington and ask the government for $7.5 billion to support 25 billion dollar guaranteed loans as a way of speeding up the production of more efficient cars. It was approved in October 2008. Then, in November 2008, they went back to congress to ask for yet another $25 million. GM said they would have to have billions of dollars in loans from the government, even though they were closing plants, cutting back jobs and reducing their production.
They appeared to be in the danger of running out of money by the end of March 2009. Even with the restructuring of GM, the company expects that at the end of 2009 they will fall $14 billion short. On March 5, 2009, General Motors made an announcement that their financial survival was doubtful. Then, on March 12, 2009, GM’ withdrew from an additional $2 billion from the government, due to the fact that they had been more successful in reducing their costs than they expected.
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