Don’t bet the dealership on it, despite some media hype:

General Motors Co. filed registration papers Wednesday for an initial public stock offering, laying the groundwork for the car maker to begin cutting its ties to the U.S. government, its majority owner.

The 734-page document is the most detailed portrait yet of GM post-bankruptcy. In it, the company’s management is alternately confident about GM’s progress since its near-death experience last year, and cautious about its prospects.

GM outlines a business plan that intends to leverage its massive global scale, strength in fast-growing emerging markets such as China and a balance sheet cleaned up by Chapter 11. At the same time, the company warns it faces many risks, such as continuing losses in Europe and a significant underfunding of its pension obligations…

The IPO will allow the U.S. Treasury to begin selling the 61% stake it holds in GM after last year’s $50 billion U.S. government bailout of the company…

People familiar with the matter said the IPO, expected later this year, is anticipated to raise $10 billion to $15 billion but possibly more. An expected price range for the shares will be determined closer to the sale.

The U.S. and Canadian governments will give up their right to nominate directors to the GM board after the stock offering, GM said in the filing. The Canadian and Ontario governments became GM shareholders after giving the company aid. The governments have said they are considering whether to participate in the IPO…

As part of the 16 pages of “risk factors” in the filing, GM warns that while the U.S. car industry has recovered this year, “there is no assurance that this recovery in vehicle sales will continue or spread across all our markets.” GM also said its pension plan is underfunded by $27 billion, $10.3 billion of which is in the U.S.

In addition, GM said it is unable to assure the accuracy of financial details about its operations because of weaknesses in its internal financial controls. GM said it has put in place steps to correct the weaknesses, but won’t be able to test them for effectiveness until next year, when it can compare year-over-year financial results.

Other risks outlined by the company include problems that could stem from global overcapacity in the car industry and rising costs of raw materials.

GM said its market-share losses over the past three years can be attributed to perceptions of its brand among consumers…

For the government to recoup its full investment GM must achieve a stock-market value of $70 billion—10 times GM’s market capitalization before the company headed into bankruptcy-court protection in June 2009, and at least $30 billion more than the market value of Ford Motor Co.‪..

Mr Flaherty et al. in our government must be hoping hard this brand is a winner:

Not Cruzin’ for a bruisin’

Note there will be no IPO from Chrysler, the weakest of the formerly Big Three, for some time; the Canadian and Ontario governments have a fair bundle invested in Fiysler too.  These bedpersons:

Prime Minister Stephen Harper, right, and Ontario Premier Dalton McGuinty tell reporters in Toronto that Canada and Ontario will provide $2.42 billion US in financing to Chrysler. (Darren Calabrese/Canadian Press)

Mark
Ottawa