General Motors, as everyone knows, was an icon of the auto industry, employed tens of thousands of people, and largely because of its polices and liabilities for retiree health costs and its wage structure it was at a disadvantage against all the foreign competition. So for the same quality car General Motors would have to pay more than Toyota as a for instance because they were up to $4,000.00 per automobile that started out as sum cost as a liability to retirees. So you have to pay the $4,000.00 and then the cost of building the car.

General Motors culture and its history was such that it always had unlimited cash so it never really had to worry about where the cash was coming from or even know how much cash on hand it had at a given time. But as we were rolling past the beginning of the great recession into 2009, even General Motors and Chrysler were running short of cash. And they had a belief that they could not survive Chapter 11 because they didn’t think consumers would buy cars in Chapter 11 because of fears of replacement parts, who would honor the warranty, who would do the maintenance, and what would be the resale value of their cars.

So what we did there was I spoke to the board of directors of General Motors and I explained to them and to the senior management that Chapter 11 can be used quickly. It’s not known as a quick process but it has the tools and machinery necessary to get a company through Chapter 11 quickly if that’s the only way it can survive. And I explained that it needed to file its Chapter 11 petition with a motion to sell all the good parts, the good models, the good factories, the good dealership agreements, the good intellectual property to new General Motors. And to start up a new company immediately so that the public would not fail to buy the cars for the reasons that management was concerned about.

Then the government entered the picture and the government both funded General Motors and Chrysler over, I guess, New Year’s or starting New Year’s in I think 2009. And then it went to the unions and said look, we’re willing to continue funding this to create NUCO but only if we know that NUCO will be viable. So will you agree to give up your retiree benefits or at least in substantial part and change your wage structure and agree not to strike for six years? And the unions basically said we’ll do some variation of that but only if we get something for it. So the US government agreed to give them part ownership, some debt, et cetera, a little different mix of consideration in Chrysler and in General Motors. But the union was on board in both cases and so both General Motors and Chrysler used our we called it the Section 363 strategy, it was the quick sale strategy under the bankruptcy code. And both are very well off today as are their employees and their dealerships and their dealership employees and all of the towns that have these factories and dealerships.