GM Generali

   DOW JONES NEWSWIRES 
 

Struggling auto maker General Motors Corp. (GM) said the company will address "the tough issues to improve the long-term viability of the company," including the restructuring of its financial obligations, as it responded to Washington's calls for stronger plans to stay afloat.

GM said it has a "strong preference" to complete its restructuring out of court, saying it would complete a more accelerated and aggressive restructuring to put the company on sound long-term financial footing.

"We have significant challenges ahead of us, and a very tight timeline," said new GM Chief Executive Fritz Henderson. "I am confident that the GM team will succeed, and that a stronger, healthier GM will play an important role in revitalizing America's economy and re-establishing its technology leadership and energy independence."

Henderson, one of the auto maker's top troubleshooters for nearly a decade, took over as GM's chief executive early Monday, following the forced resignation of Chairman and Chief Executive Rick Wagoner. Wagoner was ousted as a condition of giving the company another 60 days to craft a plan the government feels will work.

GM on Monday was scrambling to understand the implications of President Barack Obama's assessment that the company's efforts to save itself are falling short and bankruptcy may be the company's best option.

The company is surviving on government loans and is seeking as much as $30 billion to stay out of bankruptcy court.

Henderson said the administration has "made it clear that it expects GM to expand and accelerate its restructuring efforts."

GM submitted an overhaul plan in February, which called for cutting 47,000 jobs worldwide and drastically shrinking the company's models, brands and dealers. But people close to the president's auto task force have said it considered the plans inadequate to transform the company into a profitable enterprise.

Shares were down 21% to $2.87 in recent trading amid a broad decline. The company's stock has lost three-quarters of its value since September.

-By John Kell, Dow Jones Newswires; 201-938-5285; john.kell@dowjones.com