General Motors files for bankruptcy protection
Posted June 1, 2009 8:18 a.m. EDT
Updated June 1, 2009 1:01 p.m. EDT
New York — General Motors has filed for bankruptcy protection as part of an Obama administration plan to shrink the automaker to a sustainable size and give a majority ownership stake to the federal government.
The fallen icon of American industrial might filed its Chapter 11 petition in New York on Monday. It marks the fourth-largest bankruptcy in U.S. history and the largest for an industrial company.
GM's reorganization plan will rely on up to $30 billion of additional financial assistance from the Treasury Department. That's on top of the $19.4 billion in taxpayer money GM already has received in the form of low-interest loans.
As part of bankruptcy restructuring, GM. says it will permanently close nine more plants and idle three others to trim production and labor costs.
Assembly plants in Pontiac, Mich., and Wilmington, Del., will close this year, while plants in Spring Hill, Tenn., and Orion, Mich., will shut down production but remain on standby.
Powertrain plants in Livonia, Flint and Ypsilanti Township, Mich. will close next year, along with plants in Parma, Ohio, and Fredericksburg, Va.
Stamping plants in Indianapolis and Mansfield, Ohio, also will close. A stamping plant in Pontiac, Mich., will be idled but remain in a standby capacity.
GM says it will also close service and parts warehouses in Boston, Jacksonville, Fla., and Columbus, Ohio, by the end of this year.