I've thought for some time that GM has no real choice but to go Chapter 11. It will do so to shed its legacy costs. But that brings with it a bigger risk to Ford in that in so doing it will give the GM coming out of Chapter 11 a competitive advantage to Ford which will still have the legacy costs.
The government will not bail out GM. There's no money in the kitty.
GM doesn't have the product line. They can't sell them. They put all their eggs in the SUV/Truck market. $3.50 a gallon and they are DOA.
GM is probably worth more dead than alive. The best plan for Ford would be for GM to simply liquidate the company sell off its assets, real estate and everything and distribute the money to the shareholders and employees. At that point Ford would be in the driver's seat because by default Ford would inherit all of the loyal American domestic buyers such as myself with two new Fords in my garage. Ford has the product, the goodwill, and will have the market to itself (for the domestic market) and could remake itself into the premier American company in future years. But GM has to liquidate first. A Chapter 11 and reorganization and a smaller GM coming out with legacy costs gone puts Ford into the worst possible situation. Then it is Ford against GM with lower costs of $1500 per vehicle and Toyota. That's a "lose-lose" situation. Better hope for liquidation of GM.