General Motors warned on Thursday that prolonged uncertainty over its financial condition risked creating a vicious circle of shaky consumer confidence and falling production and sales.
”We need to get off the front page of the newspaper every day. We need to get this thing behind us,” Ray Young, the Detroit carmaker’s chief financial officer, said.
The warning came shortly after GM reported a $6bn first-quarter loss and an accelerating cash drain.
GM depends on US and other government aid for its survival.
It plans to file for court protection by June 1 if it cannot restructure its balance sheet through a debt-for-equity swap with unsecured bondholders and the US government, and concessions from the United Auto Workers union.
Citing the impact of bankruptcy speculation on sales, Mr Young reiterated that the group would prefer to remain out of court protection.
”But if we need to go in, it’s imperative for us to be in and out quickly,” he said.
Chrysler, GM’s Detroit rival, filed for Chapter 11 protection last week but warned that it was unlikely to survive if it could not complete a restructuring by July 1.
Mr Young declined to say whether GM would follow Chrysler’s example of closing almost all its North American plants during a court-supervised restructuring.
The first-quarter results bring GM’s losses since 2004 to $88bn.
GM shares have lost more than 90 per cent of their value in the past year. The shares closed down 3.6 per cent on Thursday.
The latest net loss, equal to $9.78 a share, compares with a loss of $3.3bn, or $5.80 a share, a year earlier.
Revenues almost halved to $22.4bn from $42.4bn.
The cash outflow totalled $10.2bn. Although higher than previous quarters, the drain was less than GM had projected, owing to stringent cost controls.
The carmaker has so far received $15.4bn in aid from Washington. It expects to need another $2.6bn this month and $9bn for the rest of the year.
Under pressure from the Obama administration’s car industry task force, it has put three brands - Saab, Saturn and Hummer - up for sale and will close a fourth, Pontiac, by the end of the year.
First-quarter operating losses in North America rose from $400m to $3.2bn while Europe swung from a small profit to a $2bn loss.