GM is planning to close factories for nine weeks given the 123 day supply of vehicles on its lots, and its precarious financial position. I doubt it can satisfy bond holders and come up with a plan that suits the government.
The government's plan is to force GM into BK court I guess. This however is seriously playing with fire. Once the factories are shuttered, and the bond payments stop, as the economy shrinks further, will there be reason to come out of BK? Apparently the secured bond holders are protected with credit default swap insurance. So there is little reason for them to budge. Apparently the UAW will drive their car off the bridge believing the government will not let GM fail, whatever that now means.
This may have a very very bad ending. The only thing GM can really lay unique claim to is building a good light truck line up to about the two ton level. But that is a small fraction of what they do overall now. I am increasingly fearful that a trip into bankruptcy court may well be a one way venture. When the government is faced with ultimatums that the taxpayers may not weather, it may be very very tough to emerge from BK court at all.
Professor Elam 
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