If GM joins Chrysler in bankruptcy, which is more likely to survive?

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So, it appears that the Obama administration is not going to force General Motors (GM) into bankruptcy next week after all. We will now find out the results of the automaker's restructuring on June 1. That's several days later than the Washington Post had earlier reported. The plan is that the government would provide the company just short of $30 billion in new federal loans.

GM must demonstrate to the government task force that is overseeing both the GM and the Chrysler restructuring that it can be viable without the government's help or it will face bankruptcy. An Obama administration official said yesterday, "I think that in terms of the outlook, I'm not going to speculate on the bankruptcy question, but I will say that the administration is committed . . . to standing behind GM and is confident that the company will be able to restructure over a short period of time."

Let's get all hypothetical here for a moment and pretend that GM goes the way of Chrysler and is pushed into bankruptcy by the government -- which is more likely to survive?

This is a tough question to answer. I have an allegiance (misguided perhaps) to Chrysler thanks to the two cars parked in my driveway. That said, it is going to come down to which company will produce the cars that more people want to buy and, even more to the point, which company can adapt to the technology that the Obama administration is in the process of forcing on U.S. automakers.

With fuel standards tightening, it is going to be tough for either of these companies to emerge from bankruptcy on the strength of their SUV sales. So, what if GM can get the Chevy Camaro adapted to fuel standards or (dare I say this about a muscle car) running on hybrid technology? (I know, I feel dirty for even suggesting it.) How about a hybrid Hummer or a hybrid Jeep Wrangler? I shudder at the thought, but it is possible and it could help the respective automakers survive into this century's second decade.

Again, this is all hypothetical -- the deadline now is still a whopping week-and-a-half away (well, less if you don't count Monday's holiday). However, if GM joins Chrysler in bankruptcy, it will be innovation that decides whether both or either emerges. A matter of which changes its old ways first and who can give customers what they want within the constrictions of the new government standards.

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