General Motors filed for bankruptcy protection Monday morning, and will be split over time into “new” and “old” companies with billions of new dollars in support from the U.S. government as well as the governments of Canada and Ontario.
GM filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the Southern District of New York at 8 a.m. Eastern time Monday. President Obama is expected to make a statement about the bankruptcy at around 11:55 a.m., and GM CEO Fritz Henderson will hold a briefing in New York after the President speaks, around 12:15 p.m.
The “painful, but necessary” restructuring will take 60 to 90 days, and take GM to a breakeven point of 10 million annual car sales, Obama Administration officials said, down from its current breakeven level of 16 million.
Administration officials said they expect to proceed “broadly” in the same manner as with Chrysler, which already filed for Chapter 11 bankruptcy protection and is working to emerge. However, they noted that GM is more complicated and has many more moving pieces than Chrysler did, so it could take longer.