Meanwhile, the work necessary for averting a GM bankruptcy remains undone. Though the automaker is reportedly making progress on negotiations with the United Auto Workers, open issues remain and the GM even got into a public spat with the UAW over importing cars from China and Mexico. The union is now demanding more assurances about what cars GM plans to build in the U.S. in the future.

On a more positive note, the two sides have reportedly reached agreement on how to finance the VEBA, which was set up to fund retiree healthcare benefits for GM's blue collar workforce. GM is said to be agreeing to put in half of the $20 billion it owes the VEBA and to fund the other half with GM stock. The agreement appears to be very similar to the deal Chrysler LLC reached with the UAW. That deal puts the UAW in control of the new Chrysler, with 55% of the stock. The union has also reportedly agreed to cut labor costs, though neither the union nor GM would confirm that figure.

As part of the overall restructuring plan put forward by the company, 16 manufacturing facilities in the U.S. will be closed, including four assembly plants, according to Alan Reuther, director of the UAW Washington office.

In a related move, GM announced on Friday that 500 dealers who handle Hummer, Saab and Saturn brands would be moved outside of GM's dealer network or terminated if a buyer for those nameplates cannot be found. Also on Friday, GM began notifying 1,100 GM dealers that their franchises would be terminated because they have failed to meet sales targets. Of GM's other 4,500 dealers, the automaker expects to cut 900, and may use bankruptcy to get that done.

The biggest sticking point in any bid to avoid bankruptcy is the complexity of GM' debts. Chrysler's 40-odd creditors could fit into a large conference room. GM's creditors, however, could fill up most of the seats in the University of Michigan's football stadium. The bondholders include an estimated 127 major financial institutions, including, banks, hedge fund and mutual funds as well as another 100,000 or so small holders that represents a cross section of American savers.

The bondholders complain that neither GM or the U.S. Treasury Department has held any kind of serious discussions with them. In fact, GM CEO Henderson has described the offer to bondholders 225 shares of GM stock for every $1,000 of bond face value as a take-it-or-leave-it proposition.