Ailing US car giant General Motors has said it is ''prepared'' for bankruptcy proceedings if it is not able to restructure out of court, according to a regulatory filing it made to the Treasury Department.
Readying for possible bankruptcy court-supervised restructuring is part of the company's, ''contingency planning activities'', GM said in the filing.
The car maker maintained that out-of-court restructuring would provide over the longer term, ''the highest value outcome for its customers and this country''.
But, GM said, ''if the changes needed for long-term restructuring cannot be obtained out of court, the company is prepared and would consider in-court options.''
The firm's debt levels, GM admitted, do, ''present significant risk to the success of its overall restructuring effort''.
The White House's car taskforce announced last week harsh conditions for additional government loans for GM and another ailing car giant, Chrysler.
President Barack Obama said that if the two companies could not come up with viable plans to return to profitability, they might need to use the Chapter 11 bankruptcy process, ''as a mechanism to help them restructure quickly and emerge stronger''.
GM indicated it still believed that a bankruptcy filing could have a substantial negative impact on its business.
But it acknowledged that a Chapter 11 bankruptcy would be made easier because of the Government's offer to support GM through an in-court restructuring.
The Obama Administration held back early last week an extra $US21.6billion ($A30.22billion) in taxpayer-funded loans for GM and Chrysler, saying neither company had met the strict conditions laid down under a $A24.34billion government bail-out agreed late last year.
The Administration gave GM, the largest US car maker, 60 days to develop a more aggressive restructuring plan and a credible strategy.
AFP
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