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General Motors Presents Reorganization Plan to Congress

In a surprise revelation, General Motors (GM) says that it needs an immediate infusion of loans to stay in business beyond the end of December. In its reorganization plan presented yesterday to the Senate Banking Committee, GM requested a total of $18 billion, with a promise to reduce its total debt of $62 billion through renegotiation with creditors, and cut expenses by paring down the number of main domestic brands, phasing out or selling Saab, Saturn, Pontiac, and Hummer. Like his counterparts at Ford Motor Company and Chrysler LLC, CEO Rick Wagoner would accept an annual salary of $1 per year and eliminate all bonuses. In addition, the GM plan says other executives would take pay cuts of 20 to 30 percent and their bonuses would be eliminated as well. The company would reduce the number of powertrain and stamping facilities to 38 by the end of 2012, down from it current 64. Wagoner will join Ford CEO Alan Mulally and Chrysler CEO Robert Nardelli in Washington, D.C., this week for Congressional hearings on the proposed bailout.

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