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General Motors Bailout: A Case Study

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General Motors is a multinational company that makes and sells vehicles and its parts. In 2009 General Motors had some financial problems. The automotive company had difficulties with their finances, as a result, the company was not profitable and was leaning towards bankruptcy. The company then reached out to the government for money to help with their situation. The Bush-led government decided to use $49.5 billion of taxpayers’ money to help General Motors out. Was this the right choice for the government?
General Motor’s debt was converted into preferred and common stock that was owned by the government. The stocks were then offered to the public (Contorno, 2015). General Motors’ bailout cost taxpayers more than $11.2 billion; this included a $826-million write-off in March from government investments in the “Old GM” before the company’s bankruptcy …show more content…

The A stands for assess and it answers the question, what is the problem? The problem here is whether the government should bail out General Motors or not. B stands for brainstorm; what are the choices or solutions? The two choices would be to bail them out or not to bail them out. C stands for consequences- both positive and negative. The consequences would be the ones listed above. The consequences on taxpayers, government, employees and General Motors. D is for decide- a decision is made, and an action plan is put in place.
If I was the CEO of General Motors, my decision would be to accept the bailout. This decision would be made because General Motors would be able to still to open its doors to customers. The bailout would allow the business to continue and grow; which it did. The GMC Sierra is the seventeenth best-selling car in America (Zhang, 2017). It’s not always about the present, sometimes it’s beneficial to take risks and think long-term instead of only

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