General Motors Corp. intends to distribute marketing materials to potential buyers of its Hummer brand and a French manufacturing plant in October. That’s part of a strategy to accelerate the $15-billion cost-cutting and fund-raising plan it announced in July, GM Treasurer Walter Borst said today in a presentation to analysts.
Speaking at the Deutsche Bank Leveraged Finance Conference, which was webcast, Borst said GM is progressing on a fast pace in the cash-generating plan it announced July 15 and has hired “additional outside resources to help us meet or exceed these targets.”
Borst said GM hopes to raise between $2 billion and $4 billion in cash through asset sales but is considering the sale of assets “significantly in excess of this amount.”
“I would anticipate additional announcements for you here in the fourth quarter,” Borst said. “We believe we can monetize certain assets without impacting the strategic direction of the company.”
GM and other automakers have faced liquidity problems as losses have mounted and U.S. sales have declined. GM announced a plan in July to cut $10 billion in costs and raise another $5 billion through asset sales and borrowing through the end of next year.
Borst said that GM expects the global market to grow from 70.6 million in sales last year to more than 75 million in 2010, and says GM is positioned to capture that growth in emerging markets. The growth, coupled with cost cuts, factory capacity reductions and other management decisions, will set the stage for improved financial results by 2010, he said.
By 2010, GM will sell two-thirds of its vehicles outside the U.S., compared with 59 percent in 2007, he said.
GM issued what it refers to as its liquidity plan on July 15 to quiet Wall Street concerns that the company may not have enough cash to sustain itself until 2010. While the plan initially quelled that concern, more recent mayhem in financial markets again has the automaker confronting worries that it doesn’t have enough cash to make it through the current downturn and may now have more trouble raising the funds in the troubled credit markets.
