General Motors has reported a $6bn (£3.9bn) loss for the first quarter of 2009 as its revenues collapsed and cash drained at increasing speed from company coffers.
Between January and March, GM built 1.33m cars globally, some 900,000 fewer than in the same period in 2008.
GM has until 1 June to reduce its debts with outside investors, as well as renegotiating labour costs with the United Auto Workers union. If GM fails to rebalance its perilous financial position, it is likely to end up in bankruptcy.
According to financial reports, GM has lost some $88bn (£58bn) since 2004 and the value of its shares have crashed by 90 per cent.
GM bosses say that they are prepared to go through bankruptcy, but recognise that they have to move through the process very quickly.
GM fears ‘a vicious circle’ where car buyers stay away from a company that’s in Chapter 11 bankruptcy protection, causing revenue to collapse further and putting the firm in extra peril.