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Current DateTime: 03:25:31 11 Nov 2009
LinksList Documentid: 30830730
Expiration DateTime: 11/11/2009 3:27:30 PM
    • GM's Road Ahead  11 hrs ago

        General Motors Chairman Ed Whitacre is calling on the Obama administration to loosen pay caps. CNBC's Phil LeBeau has more on this and GM's road ahead.

    • Car Imports Widen UK Trade Gap  10 Nov 2009

        The UK's trade deficit widened to an eight-month high in September as the number of imported cars rose sharply. Neil MacKinnon from VTB Capital spoke to CNBC about the outlook for the UK and sterling.

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        The Nikkei 225 finished up 0.2% at 9,808 Monday, but volume was down at a 6-week low. Fast Retailing, Suzuki Motor, and Kubota were top gainers, but major power companies were among the hardest hit. Makiko Utsuda from The Nikkei has more.

    • Fiat's 5-Year Road Plan for Chrysler  05 Nov 2009

        Fiat said its 5-year road plan to turn around Chrysler will result in the doubling of revenue. "There is no alternative but for Chrysler to be ambitious at this point," Stefano Aversa, co-president of restructuring specialists Alix Partners, said Thursday. "They have plenty of cash."

    • Ford's Safer Seatbelt  05 Nov 2009

        Ford is unveiling its groundbreaking seat belt. CNBC's Phil LeBeau has the details.

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Current DateTime: 03:25:33 11 Nov 2009
LinksList Documentid: 30830722
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Behind The Wheel

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GM logo, General Motors logo

Less than a month from today, GM and Chrysler will have to give the federal government an update on how they are doing in restructuring their companies.

The clock is definitely ticking.

The question is whether GM [GM  Loading...      ()   ] and Chrysler will be ready to answer the bell when it rings in the middle of February? Both companies say yes, they will (what else would you expect them to say?) be ready.

Both claim that they are moving fast to change their companies. And both say they are working with the UAW to lower labor costs.

But how much should we truly expect to happen by then? From the people I've talked with, I have no doubt GM and Chrysler will have made progress in re-working their labor contracts with their auto workers.

UAW president Ron Gettlefinger and his top lieutenants are serious about modifying their agreements so they are more "competitive" with foreign auto makers. The tough part of the labor talks will come mid to late March when all sides have to agree on a final changes to the current contract.

As for GM lowering it's debt, that will likely be a much tougher task. The company needs to cut it's debt by two thirds. That means it will have to convince bond holders to exchange third debt for stock equity.

The largest bondholders have formed a committee to negotiate with GM and given how much greater risk these bond holders will face in an equity swap, those talks will be long and difficult.

Look at what happened with the GMAC debt restructuring a few weeks back.

That process was long, drawn out, and involved many bond holders saying, "No thanks, we don't like this deal." The bottom line: expect the next month to be a difficult one for GM and Chrysler.

What they have to accomplish is not impossible, but it's not going to be easy.

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