General Motors Corp (GM) said on Thursday night it would most likely pursue the same legal strategy as Chrysler if it were to spiral into bankruptcy, while Chrysler unveiled details for slashing its dealer network.
Rattling the industry further, the Financial Times reported on its Web site that Toyota Motor Co is planning one of the most drastic management shakeups in its 70-year history next month when Akio Toyoda, grandson of the company’s founder, takes over as chief executive.
Toyota will replace 40 percent of its senior managers and is said to be preparing a sweeping reorganization of its North American business that would unify sales and manufacturing arms, the report said.
PHOTO: BLOOMBERG
In a bright spot, Ford Motor Co, the only Detroit automaker not taking government bailout funds or dogged by bankruptcy or bankruptcy expectations, told shareholders at the company’s annual meeting that restructuring is on track to be at or above break-even in 2011 excluding special items.
The GM disclosure, in a regulatory filing, marked the first time the automaker has said it would most likely follow the same legal strategy Chrysler is using under federal oversight to slash debt and restructure dealerships.
GM faces a June 1 deadline to restructure its bond debt and reach a sweeping deal with the United Auto Workers. The company restated in its filing with the Securities and Exchange Commission that it expects to seek Chapter 11 if negotiations with bondholders fall short.
Chrysler said it would terminate business with 789 of its 3,181 dealerships as of June 9, a move that could cost up to 40,000 jobs, according to the leading dealer trade group. Dealers in Pennsylvania, Texas, Ohio, Illinois and Michigan — where Chrysler is based — would be hit hardest.
“The bankruptcy process that we are in allows us a once-in-a-lifetime chance to achieve a right-sized dealer body,” Chrysler vice chairman Jim Press said on a conference call. “We do not have enough production or sales to keep all the dealers alive or prosperous.”
Chrysler sought permission from a US bankruptcy court in New York to terminate franchise agreements with the dealers. Fifty percent of its US dealers account for 90 percent of sales, according to court documents.
GM also plans to announce up to 2,000 dealer terminations as early as this week, sources have told reporters.
Chrysler and GM face pressure to bring large sales networks in line with those run by more successful automakers. Toyota has 1,200 dealers in the US.
Chrysler’s move to cut dealers will help it cement an alliance with Fiat. US antitrust officials said on Thursday the plan posed no competitive issues.
Separately, the German government said it wants Fiat and Austrian-Canadian parts supplier Magna to present proposals for partnering with GM’s European unit, Opel, within a week.
ROLLER-COASTER RIDE: More than five earthquakes ranging from magnitude 4.4 to 5.5 on the Richter scale shook eastern Taiwan in rapid succession yesterday afternoon Back-to-back weather fronts are forecast to hit Taiwan this week, resulting in rain across the nation in the coming days, the Central Weather Administration said yesterday, as it also warned residents in mountainous regions to be wary of landslides and rockfalls. As the first front approached, sporadic rainfall began in central and northern parts of Taiwan yesterday, the agency said, adding that rain is forecast to intensify in those regions today, while brief showers would also affect other parts of the nation. A second weather system is forecast to arrive on Thursday, bringing additional rain to the whole nation until Sunday, it
CONDITIONAL: The PRC imposes secret requirements that the funding it provides cannot be spent in states with diplomatic relations with Taiwan, Emma Reilly said China has been bribing UN officials to obtain “special benefits” and to block funding from countries that have diplomatic ties with Taiwan, a former UN employee told the British House of Commons on Tuesday. At a House of Commons Foreign Affairs Committee hearing into “international relations within the multilateral system,” former Office of the UN High Commissioner for Human Rights (OHCHR) employee Emma Reilly said in a written statement that “Beijing paid bribes to the two successive Presidents of the [UN] General Assembly” during the two-year negotiation of the Sustainable Development Goals. Another way China exercises influence within the UN Secretariat is
CHINA REACTS: The patrol and reconnaissance plane ‘transited the Taiwan Strait in international airspace,’ the 7th Fleet said, while Taipei said it saw nothing unusual The US 7th Fleet yesterday said that a US Navy P-8A Poseidon flew through the Taiwan Strait, a day after US and Chinese defense heads held their first talks since November 2022 in an effort to reduce regional tensions. The patrol and reconnaissance plane “transited the Taiwan Strait in international airspace,” the 7th Fleet said in a news release. “By operating within the Taiwan Strait in accordance with international law, the United States upholds the navigational rights and freedoms of all nations.” In a separate statement, the Ministry of National Defense said that it monitored nearby waters and airspace as the aircraft
Taiwan’s first drag queen to compete on the internationally acclaimed RuPaul’s Drag Race, Nymphia Wind (妮妃雅), was on Friday crowned the “Next Drag Superstar.” Dressed in a sparkling banana dress, Nymphia Wind swept onto the stage for the final, and stole the show. “Taiwan this is for you,” she said right after show host RuPaul announced her as the winner. “To those who feel like they don’t belong, just remember to live fearlessly and to live their truth,” she said on stage. One of the frontrunners for the past 15 episodes, the 28-year-old breezed through to the final after weeks of showcasing her unique