Fritz Henderson, the successor to Rick Wagoner as CEO of General Motors, says that GM will meet the demands of the Obama auto taskforce within the 60 day limit, even if it requires going into bankruptcy to do it. Automotive News reports:
 

General Motors CEO Fritz Henderson said today that he is ready to meet the Obama administration’s mandate to restructure the company — even if it means going into bankruptcy.

But Henderson said he believes he can secure concessions from GM bondholders and the UAW without seeking Chapter 11 reorganization. He declared his determination to meet administration’s 60-day deadline — with no excuses.

“The objectives are clear,” he said in his first press conference since succeeding Rick Wagoner on Monday. “So if we can’t do it out of court, we’ll do it in court.”

What the Obama administration did on Monday was send a warning shot across the bow of the groups that hold General Motors debt and to the UAW, telling them that if they do not agree to swap a significant amount of the cash they are owed by the company for stock instead then they are entirely willing to force the company into bankruptcy. Doing so would likely void the union contract and the contracts with bondholders and place them at risk of getting nothing.