GM withdraws guidance and plans to draw down $16 billion in revolving credit
General Motors Co. GM, -2.97% said Tuesday it is planning to draw down about $16 billion from its revolving credit facilities, as it works to boost cash during the coronavirus pandemic. The company said the funds will supplement the company's cash position of about $15 billion to $16 billion expected at the end of March.
"We are aggressively pursuing austerity measures to preserve cash and are taking necessary steps in this changing and uncertain environment to manage our liquidity, ensure the ongoing viability of our operations and protect our customers and stakeholders," Chief Executive Mary Barra said in a statement."Over the past several years, we have made necessary, strategic decisions and structural changes that have transformed the company and strengthened the business, better positioning us for downturns." GM Financial had $24 billion of liquidity at the end of 2019 and expects to end the first quarter with similar levels, said the statement. That should be sufficient to support at least six months of cash needs, including new originations, without access to capital markets. GM said it is withdrawing its guidance for 2020. Shares rose 4.5% premarket.
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