Singing the blues

14 May 2008 By Antony Currie Follow @AntonyMCurrie

The car maker s executives reckon $24bn of liquidity is enough for now. But they also say the US car industry is in recession. If that lasts, GM will burn through even more cash, and find refinancing debt harder. That means the knife may fall on its workers yet again.

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General Motors may need to raise $9bn or more in the next two years to refinance debt, and may need to raise more if it burns through more cash than currently expected, according to research by Lehman Brothers.

At the car maker's annual banker meeting on Tuesday, COO Fritz Henderson said the firm had enough liquidity for 2008. GM currently has $24bn in cash and another $7bn in an undrawn, committed bank line. Henderson said that the US auto industry is definitely in recession, and that the firm will consider cutting costs or raising more debt if the US economy does not improve.

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