GM, Ford, Chrysler Face Bankruptcy Risk on Crisis, S&P Says

[Purveyor]

By Jeff Green and Greg Bensinger

Oct. 10 (Bloomberg) -- General Motors Corp., Ford Motor Co. and Chrysler LLC, the three biggest U.S. automakers, may be forced into bankruptcy as the global credit freeze damps U.S. sales, Standard & Poor's analyst Robert Schulz said.

``Macro factors could overwhelm them at some point'' even as GM, Ford and Chrysler vow to stick with their turnaround plans, Schulz, S&P's lead automotive credit analyst, said today in a Bloomberg Television interview in New York. The companies said they have no plans to seek bankruptcy protection.

His assessment underscored the pressure on the industry as the worsening credit crisis makes it harder for buyers to get loans and dealers to finance their operations. S&P said yesterday it may further trim credit ratings for GM and Ford on forecasts for 2009 auto demand to fall to its lowest since 1992.

With all three companies working to boost cash, any bankruptcy filing would be a last resort, not a ``strategic'' decision, Schulz said.

``We don't see that as something they would choose,'' he said. Schulz said the ``trigger'' for a forced restructuring under bankruptcy protection would be based on the automakers' ability to preserve liquidity as sales decline. Industrywide U.S. sales slid 27 percent last month, the most in 17 years.

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BLOOMBERG: http://www.bloomberg.com/apps/news?pid=20601087&sid=agqkU7To5lzM&refer=home

[napi21]

1. Not to be too cold hearted here, but TS! Almost every major

airline has declared bankruptcy and most recovered. Sometimes poor management and the inability to respond to customer's desires quickly does take it's toll!

[NC_Nurse]

2. Another update from Capt. Obvious.

NO one could have anticipated....:eyes:

[wuushew]

3. Why is GM still paying out dividends?

That twenty-five cent per share dividend could be better used paying down the company's sizeable liabilities.

http://www.gm.com/corporate/investor_information/div_history/index.jsp

[rooney]

4. I have GM stock and have lost a ton. They are not paying dividends

at all now. They stopped about 3 or 4 or some months ago. I have lost so much in GM I am ashamed to say how much, but I still stand to lose 45000 more id it goes bankrupt. I just haveen't sold that thinking maybe it would go back up. I probably should get my little bit of money and run. EH?