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CNBC TRANSCRIPT: CNBC'S PHIL LEBEAU INTERVIEWS GENERAL MOTORS CHAIRMAN & CEO, RICK WAGONER, ON CNBC'S "POWER LUNCH" TODAY

CNBC TRANSCRIPT: CNBC'S PHIL LEBEAU INTERVIEWS GENERAL MOTORS CHAIRMAN & CEO, RICK WAGONER, ON CNBC'S "POWER LUNCH" TODAY

WHEN: Today, Friday, November 7th at 12:40 pm ET

WHERE: CNBC's "Power Lunch"

Following is the unofficial transcript of a CNBC interview with General Motors Chairman & CEO, Rick Wagoner, on CNBC, airing on "Power Lunch"

All references must be sourced to CNBC.

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Phil LeBeau: WELCOME BACK TO "POWER LUNCH." I'M PHIL LEBEAU LIVE AT GENERAL MOTORS HEADQUARTERS IN DETROIT, MICHIGAN AND JOINING ME FOR A FIRST ON CNBC INTERVIEW TO DISCUSS GENERAL MOTORS' THIRD-QUARTER RESULTS, CHAIRMAN AND CEO OF GENERAL MOTORS, RICK WAGONER. THANKS FOR JOINING US FOR A FIRST ON CNBC INTERVIEW.

Rick Wagoner: THANKS, PHIL, GOOD TO BE WITH YOU.

LeBeau: THE NUMBERS ARE NOT PRETTY. LOSE BASICALLY 4.2 BILLION IN THE THIRD QUARTER AND THE RELEASE FOR THE FIRST TIME BRINGS UP THE QUESTION OF LIQUIDITY. HOW CLOSE IS GENERAL MOTORS RIGHT NOW TOWARDS BANKRUPTCY?

Wagoner: WELL, WE'VE GOT, AS WE CLOSE THE QUARTER AND INDICATED, WE'VE GOT 16.2 BILLION IN AVAILABLE LIQUIDITY, THAT'S WELL ABOVE WHAT WE THINK OUR MINIMUM CASH OPERATING REQUIREMENT IS BUT THE CONCERN IS WITH THE CONCERN YOU RAISE WITH THE DRAMATIC WEAKENING IN THE ECONOMY AND THE FALL IN SALES. WHERE'S THAT GOING TO LEVEL OUT AND WHAT DOES THAT MEAN FOR OUR FUTURE CASH FLOW AND WE ANNOUNCED TODAY A WHOLE BUNCH OF ADDITIONAL MEASURES ON THE SELF-HELP SIDE AND IN ADDITION TRY TO PURSUE THE ASSET SALES AS AGGRESSIVELY AS WE CAN AND YOU KNOW ABOUT CONVERSATIONS IN WASHINGTON THAT PICKED UP IN EARNEST YESTERDAY.

LeBeau: YOU BURNED THROUGH ROUGHLY 2.3 BILLION A MONTH IN THE THIRD QUARTER. WILL THAT BE THE BURN RATE ROUGHLY SPEAKING IN THE FOURTH QUARTER AND IF SO HOW LONG BEFORE YOU SAY WE'RE HITTING THE MINIMUM AS TO WHETHER TO GO TO BANKRUPTCY OR NOT TO GO TO BANKRUPTCY?

Wagoner: GLAD YOU ASKED THAT. WE EXPECT IN THE FOURTH QUARTER THE CASH BURN TO BE MORE LIKE THE FIRST TWO QUARTERS OF THE YEAR. IN THE THIRD QUARTER WE HAD A COUPLE OF THINGS, WE SHIFTED OVER FROM THE KIND OF INCENTIVES FROM FINANCING INCENTIVES TO CASH INCENTIVES. THAT HAD A FAIRLY SIGNIFICANT NEGATIVE WORKING CAPITAL IMPACTED A ONE TIME AND WE BUILT INVENTORY IN EUROPE AND NOW FRANKLY WE'VE CUT A LOT OF PRODUCTION IN EUROPE SO WE EXPECT TO NORMALIZE TO A LOWER LEVEL OF CASH BURN, BUT IT CERTAINLY RAISES THE POINT OF THE NEED FOR US TO TAKE THE ADDITIONAL ACTIONS AND TO WORK EVERY ANGLE THAT GENERATE CASH THAT WE CAN.

LeBeau: IS THERE A DROP DEAD POINT WHERE YOU SAY, LISTEN, IF THINGS DON'T CHANGE, COME JANUARY OR FEBRUARY OR COME THE END OF THIS YEAR, WE'VE GOT TO MAKE SOME HARD DECISIONS?

Wagoner: WELL, WE'VE SAID THIS BEFORE SO I'M REPEATING WHAT I'VE TOLD YOU. WE HAVE NO PLANS WHATSOEVER TO CONSIDER ANYTHING OTHER THAN CONTINUE TO RUN THE BUSINESS. WE DON'T THINK ANYTHING POSITIVE WOULD COME OUT OF CONSIDERATION OF REORGANIZATION. I'VE SEEN PUNDITS WRITE THIS STUFF BUT YOU CAN'T SELL CARS TO PEOPLE UNDER THAT CIRCUMSTANCE SO I THINK IT WOULD BE A DEVASTATING IMPACT, NOT JUST FOR GM, IT WOULD BE A DOMINO EFFECT ACROSS THE WHOLE INDUSTRY.WE HAVE THE RESPONSIBILITY TO DO WHATEVER WE CAN TO MAKE SURE WE BUILD LIQUIDITY TO GET THROUGH WHAT'S AN UNPRECEDENTED CRISIS.

LeBeau: WHAT WOULD AMERICA LOOK LIKE IF GENERAL MOTORS WERE NOT AROUND BECAUSE WE'VE HEARD PEOPLE SAY LET THEM GO INTO BANKRUPTCY, WE DON'T NEED GENERAL MOTORS IN THE UNITED STATES? WHAT WOULD THE U.S. LOOK LIKE WITHOUT GM?

Wagoner: I'M NOT GOING TO SPECULATE BECAUSE WE DON'T THINK ABOUT IT FOR A SECOND. IT'S NOT AN ISSUE OF GM, BUT THE WHOLE DOMESTIC INDUSTRY.THE INTEGRATED SUPPLY BASE IN 50 STATES, DEALERS. THE IMPACT WOULD BE DEVASTATING FOR THE U.S. ECONOMY AND, YOU KNOW, I READ THE PUNDITS LIKE YOU DO, I SUSPECT THESE ARE THE GUYS THAT WERE SAYING LET LEHMAN BROTHERS GO, TOO, AND WE SEE THE IMPACT THAT THAT HAD. THAT'S A PIVOTAL ISSUE FOR THE U.S.THE FACT IS THAT THE PROBLEMS IN THE AUTO SECTOR ARE A DIRECT CONSEQUENCE OF THE CREDIT CRISIS AND WHILE GREAT INITIATIVES HAVE BEEN TAKEN TO TRY TO ADDRESS IT, IT HAS NOT MOVED INTO THE REAL SECTOR. NOW THE PROBLEMS ARE MOVING TO MAIN STREET AND WE CERTAINLY HOPE THAT WE CAN COUNT ON THE SIMILAR KIND OF SUPPORT FROM THE GOVERNMENT AS WE SAW IN RESPOND TOGETHER FINANCIAL ISSUES.

LeBeau: YOU MEET WITH NANCY PELOSI YESTERDAY IN WASHINGTON. YOU CLEARLY SPELL OUT IN VERY BLUNT TERMS WHAT YOU'RE FACING, AND YET AT THE END OF THE MEETING WHAT WE GET IS A VERY DIPLOMATICALLY WORDED STATEMENT SAYING WE UNDERSTAND THE CHALLENGES AND WE'RE CONCERNED ABOUT THE AUTO INDUSTRY. A LOT OF PEOPLE ON MAIN STREET MIGHT BE SAYING WE NEED TO KNOW IF THE GOVERNMENT IS GOING TO DO SOMETHING OR NOT DO SOMETHING. HOW QUICKLY WOULD YOU LIKE WASHINGTON TO MAKE A DECISION IN TERMS OF HELPING THE AUTO INDUSTRY?

Wagoner: OH, I THINK IT'S CRITICAL THAT WE MOVE FAST, NOT ONLY CRITICAL FOR THE AUTO SECTOR BUT I THINK FOR A LOT OF OTHER SECTORS AS WELL, AND SO I THINK IT'S THE KIND OF THING, AND I HOPE THE CONGRESS TAKES IT UP IMMEDIATELY. WE'VE HAD CONVERSATIONS WITH A NUMBER OF MEMBERS OF CONGRESS. WE MET SENATOR REID YESTERDAY WHO ISSUED I THINK A GOOD STATEMENT IN SUPPORT OF THAT DIRECTION, AND SO WE'RE GOING TO BE WORKING VERY CLOSELY WITH OUR ELECTED REPRESENTATIVES AND THE ADMINISTRATION TO ENCOURAGE MOVEMENT AS FAST AS POSSIBLE.

LeBeau: BUT YOU NEED SOME ACTION, WOULD YOU SAY, BY THE END OF THIS YEAR?

Wagoner: OH, I THINK ACTION -- WE CERTAINLY WOULD HOPE ACTION TO BE TAKEN IN THE UPCOMING LAME DUCK SESSION.

LeBeau: SO AS QUICKLY AS POSSIBLE?

Wagoner: SURE, SURE.

LeBeau: IN YOUR RELEASE TODAY YOU INDICATE THAT DISCUSSIONS ABOUT A MERGER OR AN ACQUISITION OF ANOTHER AUTO COMPANY, AND WE ALL KNOW WE'RE TALKING ABOUT CHRYSLER, AND I KNOW YOU DON'T WANT TO TALK ABOUT ANOTHER COMPANY BY NAME, BUT YOU'RE PUTTING THOSE ON HOLD WHILE YOU CONCENTRATE ON LIQUIDITY. WOULD ACQUIRING CHRYSLER, WOULD IT HAVE HELPED YOU GUYS?

Wagoner: THERE WAS A LOT OF CONFUSION AND SPECULATION AROUND THAT, BUT BASICALLY AS WE LOOKED AT THIS POTENTIAL ACQUISITION, AND I'M NOT GOING TO MENTION THE NAME OF A COMPANY FOR A VARIETY OF REASONS-IT OFFERED SIGNIFICANT SYNGERIES WE FELT BUT THE FACT THOSE SYNERGIES TENDED TO COME IN THE MEDIUM AND LONG TERM. WASN'T A NEGATIVE IN THE NEAR TERM. A LOT OF THE PRESS COVERAGE ON THIS BEING A HUGE ISSUE FOR NEAR-TERM LIQUIDITY HAD GOTTEN TO BE CONFUSING THE FACTS. THE ISSUE ON SHORT-TERM LIQUIDITY IS THE STATE OF AUTO INDUSTRY. WE SAID WE'RE GOING TO PUT ALL OF OUR EFFORTS ON FOCUSING ON THAT ISSUE FOR NOW.

LeBeau: YOU'VE GOT AROUND $16 BILLION, $17 BILLION CASH. I'VE TALKED TO SOME PEOPLE SAY YOU NEED $10 BILLION TO $14 BILLION. TO RUN THIS COMPANY. WHERE IS THE BOTTOM WHERE YOU SAY YOU CAN'T DROP MUCH BELOW THERE?

Wagoner: WE TRY TO OPERATE WITHIN $11 TO 14. WE WANT TO TRY AND STAY ABOVE OR STAY IN THAT RANGE. THAT'S WHAT WE'RE COMPLETELY FOCUSED ON NOW.

LeBeau: YOU HAVE INDICATED YOU'RE PRESSURED NOT ONLY HERE IN THE UNITED STATES BUT OVERSEAS. SEEING CREDIT IF YOU WILL CRISIS SPREAD TO EUROPE AND TO LATIN AMERICA AND TO ASIA, TO THE POINT WHERE YOU'RE SEEING YOUR REVENUES DROP IN THOSE AREAS?

Wagoner: SURE. IF YOU SAW THE THIRD QUARTER RESULTS, WE SAW PARTICULARLY TOWARDS THE END OF THE THIRD QUARTER THE EUROPEAN MARKET TURN DOWN SIGNIFICANTLY. PART OF IT WAS CREDIT RELATED. WE'VE SEEN SLOWDOWNS IN OTHER PARTS OF THE WORLD MORE RECENTLY. I THINK IT'S FAIR TO SAY THAT THIS CREDIT CRISIS CONTAGION IS MOVING IN TO MANY OF THE COUNTRIES AROUND THE WORLD. IN SOME CASES IT'S SLOWING GROWTH FROM 30% TO 10%. BUT IN OTHER CASES, LIKE EUROPE, FOR EXAMPLE, PUTTING THEM IN NEGATIVE EURO. IT IS ADDING ADDITIONAL PRESSURE.

LeBeau: YOU MENTIONED LEHMAN BROTHERS AND THE FACT THEY WERE ESSENTIALLY LEFT TO GO, GO OUT OF BUSINESS. HOW DOES YOUR SITUATION COMPARE WITH WHERE LEHMAN BROTHERS WAS AND THE IMPACT IT WOULD HAVE ON THE ECONOMY?

Wagoner: NO COMPARISON WHATSOEVER. LOOK AT THINGS LIKE EMPLOYMENT, IMPACT ACROSS THE ENTIRE COUNTRY AND ACROSS THE WORLD, THE CONTRIBUTIONS TO THE TECHNOLOGY BASE IN THE U.S., MANUFACTURING BASE, IT'S REALLY A COMPLETELY DIFFERENT DISCUSSION. I THINK --

LeBeau: FAR GREATER IMPACT BY LETTING YOU GO THAN LEHMAN?

Wagoner: BUT I THINK THE LESSON FROM LEHMAN IS VERY IMPORTANT TIME AND DIFFICULT TIMES WE'RE IN, REALLY REQUIRES POLICYMAKERS TO TRY TO BE AHEAD OF THE PROBLEM RATHER THAN REACTING TO THE PROBLEMS. SO I THINK IT'S TIME, CERTAINLY OUR VIEW IS, WE'VE BEEN GLAD TO SPEND TIME WITH THE ADMINISTRATION AND GOVERNMENT TO TALK ABOUT THE FACT, LOOK, SIGNS WE SEE WHEN AUTO SALES FALL TO THEIR LOWEST LEVEL IN 50 YEARS IT'S TIME FOR ACTION AND THE TIME IS NOW. DELAYS BRING SIGNIFICANT RISKS.

LeBeau: RICK WAGONER, CHAIRMAN AND CEO OF GENERAL MOTORS FIRST ON CNBC.YOU HEARD IT THERE, GUYS. THEY DO NOT HAVE TIME TO WAIT AROUND FOR A LOT OF DISCUSSION. EITHER WASHINGTON HELPS THEM OR DOESN'T HELP THEM. OTHERWISE, WE'LL SEE WHAT HAPPENS.





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