GM to cut jobs, sell assets, raise cash to survive

GM also has faced criticism for restructuring steps since 2005 that have consistently fallen short of what was required given the downward spiral in its results.

"We have to see better demand for automobiles, for cars and trucks, in order for the liquidity crisis to be put to bed," said Tim Ghriskey, chief investment officer at Solaris Asset Management in New York. "They're burning through about $3 billion in cash a quarter. The cash drain has to stop at some point or GM has larger problems."

GM said it would save $10 billion in cash through 2009 through a series of steps including cuts to white-collar jobs and retiree health-care and an elimination of executive bonuses for 2008.

Capital spending would be cut by $1.5 billion, and GM would accelerate plant closures announced last month, as it aims to move its vehicle line-up away from a reliance on SUVs and light trucks.

Moody's Investors Service on Tuesday described GM's initiatives as "constructive," but nonetheless placed its ratings on review for downgrade deeper into junk territory, citing challenges it faces in making up lost earnings from truck and SUV sales.

"The company will continue to face the significant challenge of building enough profitability in its car and crossover portfolio to make up for the earnings," Moody's said in a statement.

The credit rating agency also put Chrysler Automotive LLC's rating on review for downgrade and kept Ford Motor Co on negative outlook, citing the same challenges.

Lehman Brothers analyst Brian Johnson called GM's cost-cutting targets "relatively credible" but said the overall plan fell short of a vision for renewal.

"The announcements offered little sense of a 'new' GM strategy or shift in the organizational culture that might set the stage for a more dramatic reinvention," he said in a note to clients.