General Motors Elects To Pass On US$2 Billion In Federal Funding

While GM has been operating on borrowed funds in recent times, there has been an extensive effort by the company to reduce costs and stem the financial bleeding.

GM's renewed focus is starting to pay dividends, with GM CFO Ray Young announcing that the carmaker will not require the USD $2 billion in Federal loans it was scheduled to receive in March.

Mr Young explained the reasoning that brought the company to this decision:

“This development reflects the acceleration of GM’s company-wide cost reduction efforts as well as pro-active deferrals of spending previously anticipated in January and February,” he said.

Having already received USD $13.4 billion, GM still has a scheduled USD $2.6 billion coming in April but it's unclear if this will be required.

GM isn't out of the woods, but there's a glimmer of light at the end of this tunnel. We'll keep you posted as more news develops.

Hit the press release below for further details on GM's position.

GM Update on Cash position

Attributable to Ray G. Young, GM executive vice president and chief financial officer

In the U.S., GM has indicated they have advised the Presidential Task Force on The Auto Industry that the $2 billion of funding previously requested for March would not be needed at this time. This development reflects the acceleration of GM's company-wide cost reduction efforts as well as pro-active deferrals of spending previously anticipated in January and February.

GM will remain in regular contact with the Presidential Task Force on the Auto Industry on the status of GM's restructuring actions, its liquidity position, timing of future funding requests, and other relevant topics of mutual concern.