Can GM Avoid Bankruptcy?

The new chief executive at General Motors (GM) says bankruptcy isn’t inevitable for the automaker.

Maybe.

Henderson told NBC’s Meet the Press that he planned to meet President Obama’s 60-day deadline to show results.

“We are planning to get the job done,” Henderson said. “Our preference would be to do it outside the bankruptcy process. If it cannot be done outside the bankruptcy process, it will be done within it.”

Why prolong the agony and delay the recovery, assuming GM survives?

Henderson became GM’s top dog a week ago after the White House rejected turnaround plans submitted by General Motors and Chrysler. He replaced Rick Wagoner, who resigned March 29 at the request of the White House.

In the last year, the US auto industry, including dealers and suppliers, slashed about 400,000 jobs while losing billions of dollars.

Last year, General Motors received about $13.4 billion in federal bailout bucks and has asked for another $16 billion. Chrysler also seeks additional aid.

According to press reports, Chrysler wants an alliance with Fiat, and may sell to the Italian company. Fiat now owns about 35% of Chrysler.

Cynics carp that a Chrysler-Fiat deal would guarantee employment for auto mechanics because Chrysler generally ranks lowest in quality among the Big Three and Fiat has never been known for building reliable cars.

Many have quipped that GM now stands for “Government Motors.” The company’s restructuring will tell us if that’s just a smart-aleck remark, or if the jokesters have a point.

The current wrangling also shows how shrewd Ford (F) was to avoid federal bailout money and all the kibitzing from Washington that comes with it.