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New GM boss open to bankruptcy

Associated Press / April 6, 2009
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DETROIT - General Motors Corp. is softening its opposition to bankruptcy reorganization.

"If it's required, that's what we'll do," its new chief executive, Fritz Henderson, said on CNN's "State of the Union" show, broadcast yesterday. But he noted that GM prefers to avoid bankruptcy protection while restructuring.

President Obama and his auto industry task force have indicated bankruptcy protection "may very well be the best solution," Henderson said. That is why, he said, it is a real, if not preferred, option.

Obama has said GM's initial plans didn't go far enough. Last week, he told the company it had 60 days to make more cuts and get more concessions from bondholders and unions, or it won't get any more government help.

The administration also forced out Rick Wagoner as chief executive.

Henderson said the government's guarantee of GM warranties and its indication that it would lend money to the automaker while it reorganized under bankruptcy protection are both "strong signals which say even if we have to go through bankruptcy, the company's going to be there."

Henderson also said he does not believe the administration should encourage Americans to buy US-made cars.

"I think the consumer should buy exactly what kind of car they think meets their needs and that excites them," he said on NBC's "Meet the Press."

Also, Henderson said that unlike Wagoner, he will not work for $1 a year. He is paid $1.3 million, a salary which was cut 30 percent.