After failing to get its debt-for-stock offer approved last week, and missing the June 1st deadline for concessions from creditors and its union, GM will file for bankruptcy later today. Reuters notes that its filing will be the third-largest in U.S. history, after Lehman Bros and Washington Mutual, and the largest ever in manufacturing.

As the Washington Post reported last week, the U.S. government will control about 60% of the company during the reorganization. The plan is to try to get GM up and running again by the end of summer as a smaller, leaner auto manufacturer:

The GM plan as detailed by U.S. officials is for a quick sale process that would allow a much smaller GM to emerge from court protection in as little as 60 to 90 days.

[…]

By preparing to take a 60 percent stake in a reorganized GM, the Obama administration is gambling that the automaker can compete with the likes of Toyota Motor Corp after its debt is cut by half and its labor costs are slashed under a new contract with the United Auto Workers union.

[…]

In the case of GM, the goal of restructuring is to allow it to return to profitability if U.S. industry-wide auto sales
recover even slightly to near 10 million on an annual basis.

Until now, GM had counted on a recovery to the 16-million-unit mark the industry last saw in 2007 in order to stop losing money, officials said.

For a great overview of the history of GM, from its huge success over half a century ago to the management (and design) failures that plagued it over the past three decades, check out “GM: Death of an American Dream” from last November’s Fortune magazine.

“GM to file for bankruptcy, Chrysler sale cleared” [Reuters]

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