General Motors Declares Chapter 11 Bankruptcy
June 1st, 2009
June 1st, 2009
How Long Ago?
15 years, 9 months, 14 days ago
Location
Detroit, Michigan, USA
Category
Economics & Industry
People
- Barack Obama
- Richard Wagoner
- Ron Bloom
Links & References
- Chapter 11, Title 11, United States Code
- General Motors Chapter 11 reorganization
- General Motors
- Bankruptcy
Tags
General Motors Declares Chapter 11 Bankruptcy
General Motors, one of the largest automotive manufacturers, filed for Chapter 11 bankruptcy protection in a strategic move to reorganize its business. The filing came after several years of financial struggle and mounting losses, marking a significant moment in the auto industry's evolution. The action was designed to secure the company’s future while allowing for government intervention and restructuring plans aimed at restoring profitability and competitiveness in the global market.
GM's bankruptcy was the fourth largest in U.S. history.
The company received significant government financial aid.
Over 30,000 jobs were lost during the restructuring.
GM emerged from bankruptcy within a few months, restructured.
What Happened?
General Motors, founded in 1908, faced severe financial challenges leading up to its Chapter 11 filing. Facing declining sales, rising production costs, and increased competition from foreign automakers, GM struggled to maintain profitability. The financial crisis of 2008 exacerbated these issues, leading to dramatic declines in consumer spending and auto sales. As part of its reorganization efforts, GM sought assistance from the federal government, which provided billions in taxpayer-funded loans as part of a broader automotive industry bailout. The Chapter 11 filing allowed GM to restructure its debts and business model while helping it to emerge with a more competitive stance in the market. The bankruptcy marked the largest of its kind in the automotive industry and the fourth-largest bankruptcy in U.S. history at that time. A significant aspect of the restructuring involved closing unprofitable plants and scaling down its employee base.
Why Does it Matter?
The filing for bankruptcy represented a watershed moment for the American auto industry, prompting discussions about the future of manufacturing in the U.S. It spurred a reevaluation of corporate practices and government policies regarding industry support. The ramifications included shifts in labor relations, changes in consumer behavior, and restructuring of the automotive supply chain, with lasting implications for market dynamics.
Discover More Historic Events from June 1st
Yangtze River Ship Capsizes with Heavy Loss of Life
A ship carrying 458 people capsized in the Yangtze River in Hubei province, China, leading to a tragic loss of life, as 442 passengers perished in the disaster. The ship was reportedly caught in a severe storm, which contributed to the incident, highlighting concerns regarding safety regulations in the region’s shipping industry. Rescue operations were launched immediately following the capsizing, with teams working tirelessly to locate survivors and recover those missing.
Continue ReadingSevere EF3 Tornado Hits Springfield, Massachusetts
A rare tornado outbreak occurred in New England with a powerful EF3 tornado striking Springfield, Massachusetts. This severe weather event on June 1, 2011, resulted in the tragic loss of four lives and left hundreds injured. The tornado intensified quickly, causing extensive damage to homes and infrastructure within the city, with winds reaching over 135 mph. Emergency services responded rapidly to assist those affected, marking one of the most destructive tornadoes in recent New England history.
Continue ReadingFinal Landing of Space Shuttle Endeavour
Space Shuttle Endeavour concluded its mission with a landing at the Kennedy Space Center, marking its 25th and last flight. Endeavour was launched on its final journey to the International Space Station (ISS) and completed various scientific missions during its service. This flight was significant for NASA and the future of human space exploration, highlighting the shuttle's achievements since its first flight in 1992.
Continue ReadingAir France Flight 447 crashes into the Atlantic Ocean
Air France Flight 447, operating from Rio de Janeiro to Paris, disappeared over the Atlantic Ocean while cruising at an altitude of 35,000 feet. The flight lost contact minutes after takeoff and ultimately crashed into the ocean, killing all 228 people on board. The incident involved severe weather conditions during a thunderstorm, contributing to the loss of control encountered by the flight crew.
Continue ReadingUniversal Studios Fire Destroys King Kong Attraction
A fire erupted on the back lot of Universal Studios, resulting in the destruction of the King Kong Encounter attraction and a substantial archive of master tapes. The blaze began in the early morning hours and quickly spread, prompting a significant emergency response. The full extent of the loss, particularly regarding the archived film and music master tapes, was not fully disclosed until 2019, revealing a cultural and historical treasure lost to the flames.
Continue ReadingTerry Nichols Receives Consecutive Life Sentences
Terry Nichols was sentenced to 161 consecutive life terms without the possibility of parole for his role in the Oklahoma City bombing, which targeted the Alfred P. Murrah Federal Building in 1995. This devastating act of domestic terrorism killed 168 people and injured over 600 others, marking it as one of the deadliest attacks on American soil. Nichols, alongside Timothy McVeigh, was convicted for the bombing's planning and execution. The sentencing aimed to ensure Nichols would spend the rest of his life in prison, serving justice for the victims and their families.
Continue Reading