Tuesday, November 11, 2008
GM News-GM shares hit 65-year low amid liquidity concerns
DETROIT (Reuters) – Shares of General Motors Corp plummeted 15 percent to a 65-year low on Tuesday, extending recent steep declines on lingering concerns that the automaker's cash holdings might fall below the necessary minimum during the first quarter.
Shares of other automakers and parts suppliers also declined across the board amid increasing concerns over whether the industry could survive a deep downturn in U.S. auto sales.
Credit analysts at JPMorgan said on Tuesday GM has several options to improve liquidity, but added that the No. 1 U.S. automaker's short-term survival will require the help of the government, the company's suppliers, or both.
While government aid would decrease the risk of a bankruptcy, analysts have warned that any assistance would come at a significant cost to existing shareholders.
The White House said on Tuesday it was open to considering any proposals from Congress to accelerate loans to the ailing U.S. auto industry from the already-appropriated $25 billion package.
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