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Published: Friday, 9/17/2010

Old GM struggles with scraps left from bankruptcy

NEW YORK TIMES

FLINT, Mich. - By day, hundreds of workers make pistons and other engine parts at a GM factory on this city's east side. By night, gangs have repeatedly looted empty plants on the same property and have twice fired shots at guards.

The scene at Flint North, as the complex of mostly closed factories is known, is a vivid reminder that the automaker's bankruptcy last year gave birth to two GMs - and that one is struggling in the shadow of the other.

When U.S. taxpayers bailed out GM, the company was split, with the best assets going to the reorganized automaker. This new General Motors Co. is selling cars, making money, and preparing a public stock offering.

The least valuable assets, including the run-down factories in Flint, were left in the shell of the old GM, now named Motors Liquidation Co.

This company has filed a bankruptcy reorganization plan that lays out how it will clean up and sell the unwanted pieces of what was once the world's largest automaker.

But the process is slow, and the empty factories are becoming a burden.

No Motors Liquidation assets are in the Toledo area.

Fifty miles west of Flint, officials in Lansing Township are still waiting for either company - GM or Motors Liquidation - to cart off rubble from two big plants demolished before bankruptcy.

Motors Liquidation's assets constitute the infrastructure of what could be a small automaker: four assembly plants, five engine plants, and several stamping plants. Many of the properties are contaminated with industrial waste.

The biggest challenge for Motors Liquidation, the company said in its recent bankruptcy filing, is to clean up the old facilities so they can be put up for sale.



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