General Motors (GM) has appealed to the government for $18 billion in federal loans, that’s $6 billion more than it asked for just a few weeks ago. GM says that it needs an immediate injection of $4 billion dollar or it may not be able to remain through the end of the year. That has fueled suspicions that GM may be filing for bankruptcy protection. If GM goes down, most likely Ford and Chrysler will be close behind, urgently filing for bankruptcy to protect their assets and save their companies.
In exchange for the financial bailout, GM promised government officials that it would drastically cut jobs, close factories, brands and decrease executive pay. Well you know there’s trouble when the big boys are promising to cut their own pay. Bankruptcy may definitely be on the horizon for these automakers; but it’s not going to be an easy transition. Although, Dallas-Fort Worth is a long way from Detroit, any bankruptcy filed by GM or the other major automakers could spell serious trouble for the Dallas-Fort Worth economy. More new cars are sold in the Dallas-Fort Worth area than in any other part of the country, to the tune of $15 billion a year, creating jobs for residents and serving as one of the main engines of this economy. Although an injection of cash into these automakers may help them in the short run, the jury is still out on whether they should be bailed out or allowed to go bankrupt.