GM on edge of bankruptcy

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General Motors has moved to the edge of bankruptcy as debt-holders refused a last-minute deal on Wednesday. Meanwhile, rival Chrysler is making its final pitch for its plan to sell most of its assets to Italian automaker, Fiat.

General Motors is getting closer to filing what would be the largest industrial bankruptcy in US history.

The auto giant's debt exchange proposal was rejected by bondholders, and the company is running out of time ahead of a June 1st restructuring deadline imposed by the federal government.

Weighed down by crushing debts and unsold vehicles, GM and its rival Chrysler have both been seeking a way out after billions in federal loans failed to halt their slide.

Chrysler declared Chapter 11 last month, but unlike its so-called surgical bankruptcy, analysts say, GM's will likely be far more complicated:

Rebecca Lindland of IHS Global Insight:

"If GM heads into bankruptcy which really does look pretty likely, we are looking at a longer drawn out process than Chrysler has been able to enjoy in large part because GM is a publicly traded company, Chrysler is privately held. so there's a lot more parties that are involved, the bond holders, the debt holders, the stock holders all of those people are heavily involved in GM and they have a say in this."

In fact Chrysler's bankruptcy- filed less than 30 days ago, is quickly making its way through the courts. On Wednesday, a judge was expected to approve its sale to a group that includes Italy's Fiat.

Analysts say Chrysler will still need to quickly address its deep set of troubles:

Rebecca Lindland of IHS Global Insight:

"I think that they are going to emerge from bankruptcy, however that doesn't mean that all of their problems are going to be solved because in order for this company to become profitable consumers need to start buying their products again and that's a huge obstacle still facing Chrysler is just getting consumers back into the showroom."

GM has also suffered from production far exceeding the appetite for the cars and trucks it sells. Bankruptcy or not, in the end only car buyers can truly bring Chrysler and GM back to health.