U.S. President Barack Obama promised on Monday that the U.S. government will invest additional 30 billion dollars in GM, which he was confident, will emerge from the bankruptcy protection process quickly.
"I recognized the importance of a viable auto industry to the well-being of families and communities across our industrial Midwest and across the United States," Obama said hours after GM filed for bankruptcy protection.
"In the midst of a deep recession and financial crisis, the collapse of these companies would have been devastating for countless Americans and done enormous damage to our economy, beyond the auto industry," Obama stressed.
The president noted that if GM and Chrysler remade and retooled themselves for the 21st century, "it would be good for American workers, good for American manufacturing and good for America's economy."
General Motors Corp., the top U.S. automaker and once the world's largest corporation, filed for bankruptcy protection earlier Monday.
The collapse of the century-old auto giant came at a time when the United States is experiencing the worst economic recession since the Great Depression. Just a month ago, Chrysler LLC, the country's third largest automaker, took the same path.
However, Obama said he was confident that GM will emerge from the bankruptcy protection process quickly.
"Working with my auto task force, GM and its stakeholders have produced a viable, achievable plan that will give this iconic American company a chance to rise again," said the president.
"As this plan takes effect, GM will start building a larger share of its share here at home, including fuel-efficient cars," Obama added.
As the part of the plan, the U.S. government will pour another 30 billion dollars into GM to fund operations during this reorganization, and U.S. taxpayers will end up with a 60 percent stake in GM.
Obama acknowledged that the move would raise some concerns over the government's role in GM.
"These steps have put our government in the unwelcome position of owning large stakes in private companies for the simple and compelling reason that their survival and the success of our overall economy depend on it," he said.
"What I am not doing, what I have no interest in doing, is running GM," Obama noted. "The federal government will refrain from exercising its rights as a shareholder in all but the most fundamental corporate decisions."