GM approaches bankruptcy

General Motors Corp, which has until June 1 to complete a reorganisation plan, warned this week that is in "intense" and "earnest" preparations for a possible bankruptcy filing. GM has lost about $82 billion since 2005 when its problems began to mount in the US market. Here is a timeline of recent events in the company's decline: March 16, 2005 - Slumping North American auto sales lead GM to warn that 2005 earnings will be as much as 80 per cent below its prior forecast, making it the worst performance since 1992. Feb. 20, 2006 - Fortune magazine cover story says GM headed for bankruptcy. The story cites grim assessments by Moody's and S&P that doubt GM will be able to turn around its North American business, which had a market share of 26 per cent. July 15, 2008 - GM announces a plan to cut costs by $10 billion, suspend its dividend and sell up to $4 billion in assets, such as its Hummer brand, in a bid to shore up cash. -- A hurried restructuring is forced by high fuel prices, a consumer shift away from low-mileage trucks, the weakest US auto sales in a decade and growing investor doubts about the automaker's ability to ride out the downturn. Nov. 21 - GM decides to return two of its leased corporate jets after intense criticism by lawmakers after Chief Executive Rick Wagoner flew to Washington in a private jet to ask for public funds. Dec. 19 - GM receives $13.4 billion in emergency government loans from the Bush administration to stave off bankruptcy and prevent a collapse. -- The money was part of the $700 billion Troubled Asset Relief program (TARP). Under the loan's terms, a March 31 deadline is set for GM and Chrysler, which received $4 billion, to prove that they can restructure enough to survive. Jan. 15, 2009 - GM says it expects US auto sales in 2009 to drop to their lowest level in 27 years, cutting its forecast to the low end of prevailing expectations. Feb. 17 - GM requests an additional $16.6 billion in U.S. government loans, for a total of up to $30 billion in loans, and says it will run out of cash by March without new federal funding. -- It also says it has not reached deals with bondholders and its major union to reduce some $48 billion in debt but will work to reach those agreements by the end of March. -- It also promises to step up cost-cutting by reducing its global workforce by 47,000 jobs in 2009 and cutting five additional U.S. plants by 2012. In addition, GM said it would cut its U.S. workforce by another 20,000 by 2012. March 12 - GM says it has told US officials it can survive without $2 billion in additional aid it requested. March 16 - Advisers to GM bondholders say they presented a framework plan to President Barack Obama's autos task force and GM that provides the company's best chance for an out-of-court restructuring. March 29 - CEO Rick Wagoner resigns under pressure from the Obama administration two days before the March 31 deadline to prove it can become viable and worthy of new federal assistance. March 30 - Obama orders GM and Chrysler to accelerate their survival efforts and brace for possible bankruptcy, saying neither company has done enough to justify the taxpayer money they are seeking. -- The Obama administration gives GM 60 days to rework its survival plan. New CEO Fritz Henderson says a court-supervised restructuring in bankruptcy might be necessary. April 8 - The Treasury says that GM has launched its supplier support programmes backed by up to $5 billion in US government funds.