Catherwood LibraryILR School

U.S. automaker General Motors will eliminate a total of 21,000 jobs, shrink the number of U.S. dealerships, and wind down its 83-year-old Pontiac brand as part of a restructuring plan that must by completed by June 1st in order for the firm to avoid bankruptcy. The layoffs will reduce GM's U.S. workforce to 40,000. GM is also seeking to reduce its debt by asking creditors to take shares of the company rather than cash as a portion of their payment. Furthermore, the company is asking the government to switch half of its current government loans for a 50% government stake in the firm. Finally, GM is asking the UAW to accept company shares instead of cash for 50% of its obligation to the union's healthcare trust. The proposed measures would dilute current shareholders to owning just 1% of the company.