General Motors: Yes We Can!

Yes we can! ( Absolutely hate this phrase! Did you hear it at the recent Grammy? Wanna try translating that phrease? oO )

Now here's am incredible development from General Motors.

General Motors to Invest $1 Billion in Brazil Operations -- Money to Come from U.S. Rescue Program

Yes no joke!

The company that was crying out loud to be bailed out is considering to invest $1billion in its Brazil operations!

And I doubt if the American tax payers would be too happy to read such a development from GM.

• General Motors to Invest $1 Billion in Brazil Operations -- Money to Come from U.S. Rescue Program
  
  By Russ Dallen
  Latin American Herald Tribune staff
  
  SAO PAULO -- General Motors plans to invest $1 billion in Brazil to avoid the kind of problems the U.S. automaker is facing in its home market, said the beleaguered car maker.
  
  According to the president of GM Brazil-Mercosur, Jaime Ardila, the funding will come from the package of financial aid that the manufacturer will receive from the U.S. government and will be used to "complete the renovation of the line of products up to 2012."
  
  "It wouldn't be logical to withdraw the investment from where we're growing, and our goal is to protect investments in emerging markets," he said in a statement published by the business daily Gazeta Mercantil.
  
  Meanwhile, he cut the company's revenue forecast for this year by 14% to $9.5 billion from $11 billion, as the economic crisis began to cause rapid slowdowns in sales.
  
  GM already announced three programs of paid leave, and Ardila added that GM Brazil "is going to wait and see how the market behaves in order to know what decision to take" with regard to possible layoffs.
  
  For Ardila, the injection in Brazil's automobile sector of 8 billion reais ($3.51 billion) recently announced by the federal and state governments of Sao Paulo "has already begun to revive sales," which fell by 12% in October.
  
  The executive said that the company will operate a "conservative" scenario in 2009 with an estimated production of 2.6 million units, and another more "optimistic" that contemplates sales of 2.9 million.
  
  This year sales will reach 2.85 million vehicles, which represents a growth of 15% over last year.

And ob Reuters: GM bankruptcy could speed restructuring-analyst

• DETROIT, Feb 9 (Reuters) - A bankruptcy filing by General Motors Corp (GM.N: Quote, Profile, Research) could allow the struggling automaker to reduce its debt more aggressively than an out-of-court restructuring and might not be as damaging as it would have been just a few months ago, an analyst said on Monday.
  
  "We think the damage to the enterprise of a GM bankruptcy today is notably less than it would have been a few months ago, largely because of public desensitization to a bankrupt carmaker," JP Morgan analyst Himanshu Patel said in a note for clients.
  
  Patel's note raises the possibility by a prominent Wall Street analyst of the renewed threat of a bankruptcy by GM or Chrysler, a risk many observers believe had been sharply reduced by the government bailout.
  
  GM, like its smaller rival Chrysler LLC [CBS.UL], faces a Feb. 17 deadline to submit new restructuring plans to the U.S. government under the terms of the $17.4 billion rescue provided to the struggling automakers.
  
  GM has said it is aiming to reduce its unsecured U.S. debt by about two-thirds from nearly $28 billion to $9 billion. The company also plans to halve the $20 billion it has promised to a health care trust fund affiliated with the UAW by offering equity instead of cash.
  
  But Patel said the diminished threat of a bankruptcy filing by GM appeared to have removed a key incentive for bondholders to offer concessions.
  
  "After the GM bailout, GMAC received aid, GMAC received bank holding status without achieving required funding levels (and) Chrysler and its (financing company) received aid," Patel said. "All of these steps by the government were likely to have emboldened bondholders."
  
  "POLITICAL LIGHTNING ROD"
  
  Patel said that if GM fails to win substantial concessions from bondholders and the UAW, the bailout could become "a political lightning rod" for the Obama administration.
  
  "We are increasingly thinking that such a development might force the White House to more seriously consider allowing GM/Chrysler to go into bankruptcy," he said.
  
  GM has repeatedly ruled out seeking bankruptcy protection, saying such a step would scare off consumers, cause its revenues to plummet and risk that a Chapter 11-style restructuring would end up as a liquidation of its assets.
  
  But some critics of the U.S. bailout for the auto industry have said that the government could provide bankruptcy financing for GM or Chrysler and allow them to win deeper concessions from creditors and the union.
  
  The U.S. Treasury has retained two law firms with extensive bankruptcy experience and the investment bank Rothschild to advise officials on the taxpayer-backed restructuring of GM and Chrysler. One of the scenarios those advisers will consider will be a government-assisted bankruptcy filing, a person with direct knowledge of the work has said.
  
  Another of the other immediate priorities will be working out an agreement between other creditors and the government that would provide senior status to the public funding, a second person involved in the discussions said.
  
  JP Morgan's Patel said a bankruptcy filing by GM would likely cut the automaker's debt by over 60 percent compared with just a 25 percent cut in indebtedness under an out-of-court restructuring. (Additional reporting by Jui Chakravorty in New York; Editing by Brian Moss)