GM Shares Sink; CEO Says Liquidity Adequate

General Motors has adequate liquidity to carry it through the end of this year and has many options beyond that, Chief Executive Rick Wagoner said on Thursday.

Wagoner sought to reassure investors and and analysts with GM shares falling to their lowest level since the mid-1950s and new concern surfacing on Wall Street that the auto giant may have to raise capital.

"As we've said before, we've got a very good, solid funding base under any scenario we see, solid through the end of this year," Wagoner told reporters after attending an economic summit with U.S. Democratic presidential candidate Barack Obama.

"We have a lot of options to fund beyond that," Wagoner said.

GM, Ford Motor and Chrysler are fighting a severe pull-back in sales of bread-and-butter sport utilities and pickups amid $4 gasoline as they scramble to restructure operations.

Earlier Thursday, the cost to insure the debt of GM and Ford hit record highs over liquidity concerns.

In addition Goldman Sachs reduced its rating on GM stock to sell from neutral and added GM shares to its "Americas Sell List," saying the main risks for GM include likely equity dilution, dividend cut and cash burn.

"We think GM's automotive cash flow burn this year and next is likely to lead it to look to raise capital, which we believe could lead to significant shareholder dilution and/or a cut to the company's dividend," analyst Patrick Archambault said.

In his comments to reporters, Wagoner said GM has moved "quite proactively" to address the dramatic consumer shift away from light trucks and has taken "some very tough measures."

Shares of GM, a component of the Dow Jones Industrial Average, have lost about three-quarters of their value since hitting its 52-week high of $43.20 in mid-October. The stock's steep decline has erased millions of dollars in market capitalization. (Click for further analysis of the stock's decline from CNBC's Phil Lebeau.)

Archambault has set a 12-month price target of $11 for GM. Previously, its target was $16.

Archambault also cut its rating on Lear , a big GM supplier, to sell from neutral, and lowered its price target to $19 from $28.

The analyst said Lear faces headwinds from raw materials and a "disproportionately large exposure to Big Three trucks."

Archambault also cut his price target on Ford to $5 from $8, and cut its rating on Tenneco to "neutral" from "buy."

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