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The General Is Dead, Long Live The General Photo:
 
 
Steane Klose | Dec, 20 2011 | 1 Comment

Remember the 'old' General Motors Corporation, the goliath that slid into insolvency in 2009 before restructuring under US Chapter 11 laws and a US$45.9 billion government rescue?

GM was the largest industrial corporation ever to go bankrupt in the US.

With it came a massive restructure and rationalisation across its global assets and operations, but cutting deepest in GM's heartland of North America. The old GM - General Motors Corporation - became Motors Liquidation Company, and, in parallel, a 'new' GM was created.

Now, two and a half years later, as of Thursday, December 15 2011, the old GM has officially been laid to rest.

The old GM was 103 years old, and, for the most part, they had been 103 good years.

By 1931, GM was the largest car manufacturer in the world, and in 1955 employed a worldwide workforce of 625,000.

Even in 1997, with a significantly smaller workforce, GM was still a juggernaut that dwarfed the likes of Microsoft, Boeing and Coca-Cola with ease.

But then the unthinkable. With the onset of the global financial crisis the automaker however was faced with oblivion - caught with too many cars, too many unfunded liabilities, too many outdated factories and too few sales. It culminated with the historical giant of US manufacturing filing for Chapter 11 bankruptcy on June 8 2009.

The death warrant for the century-old company was signed.

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Three GM brands were put to the sword with it: (Pontiac, Hummer and Saturn), while Saab was sold off (and in news overnight, looks like being wound down).

There were 13 plant and 900 dealership closures. The North American workforce was slashed from 91,000 to 68,500, and the US government tipped in a whopping US$49.5 billion throughout the process.

But now leaner, smarter and holding on to the best assets, the new GM is now turning a solid profit (US$4.7 billion profit last year and so far a Toyota-beating US$7.1 billion until the end of September 2011).

Times are better at the new GM, but spare a thought for the old warhorse that has passed on. In her heyday, they didn’t come much bigger, or more impressive.

 
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