General Motors Corp will announce details of its massive restructuring plan today, including the demise of its Pontiac brand, more factory closures and bigger job cuts as it fights to avoid bankruptcy protection.
The struggling carmaker must make the announcement in advance of a planned offer to its bondholders to swap debt for company stock.
GM owes $28bn to large and small bondholders, and under Securities and Exchange Commission rules, it must disclose its operational plans before making an exchange offer.
Two sources said the Detroit-based company has decided to close more factories than the five it announced in February.
But the locations of the doomed factories will not be identified today, said the sources.
GM will list specific numbers of factory job cuts, and announce another round of US salaried job cuts beyond the 3,400 completed last week.
Chief Executive Fritz Henderson has said the company will go further and faster in making its cost cuts to reduce the number of cars and trucks it needs to sell to break even.
GM will accelerate many cuts previously planned for 2014 to instead take place between now and 2010, although specifics were not available.
Both sources confirmed that the plan includes the death of Pontiac, famous for the Trans Am sports car and the GTO.
Efforts in the last few years to market Pontiac as performance-oriented brand failed to work.
The company had said it wanted to keep Pontiac as a niche brand with one or two models, but is buckling under tremendous government pressure to consolidate its eight brands, several of which lose money.
The people said GM won’t have much new information on Hummer, Saturn or other brands, including Europe’s Opel. GM has indicated it wants to focus on four core brands, Chevrolet, Cadillac, GMC and Buick.
Also to be announced today will be a target number for dealer reduction, as well as details of GM’s bond exchange offer.