GM About to Exit Bankruptcy a New Company......Really?

In order to emerge from bankruptcy quickly, GM has sold its most profitable brand, dealerships, and factories to the "new GM" which is 61% owned by the U.S. government, a union-owned health care trust owns 17.5%, Canada owns about 11.7%, and the old GM eventually will get 10%.

GM will keep four brands -- Chevrolet, Cadillac, GMC, and Buick. Out of these brands, the Corvette is the most profitable car currently made by GM. About 2000 GM dealerships will close gradually over the next two years and about 16 plants will close by 2012.

GM has a number of new cars in the pipeline including a couple of muscle cars like the Chevy Camaro, made more fuel efficient. They also are producing a new Buick, popular in China, and the last Pontiac that will be made, a new sports car. Add a couple of fairly fuel efficient SUV's to the mix, including a Cadillac. Do you see much that's different there? I don't.

Is this really a "new" GM? The new GM will have the same old problems. It will emerge from bankruptcy with less than 20% market share in the automotive market. A big problem will be consumer perception of the company. Will anyone want to buy the cars? Then there is the recession and tight money. People aren't buying cars in droves.

As if that weren't enough, there is still the union, high wages, and an underfunded pension plan.

I don't see much different between the old GM and the new GM. I wonder about the management structure. The Obama administration says it has no plans to participate in the operations of the company, but with a 61% share of the GM, it seems it will have to have representation on the Board of Directors.

I have to wonder if the new GM will last for a little while and then start to, once again, fail. Brands, like Corvette and Cadillac, may be sold off. What do you think about the new GM, its chances for survival, and how the government will handle its stake in the company?