DETROIT – General Motors Corp. filed for Chapter 11 bankruptcy early Monday, marking the humbling of an American icon that once dominated the global car industry and setting up a high-stakes gamble for U.S. taxpayers.

President Obama is expected to defend General Motors’ bankruptcy plan and the massive bailout, The Wall Street Journal reported.The reorganization plan will call for a huge infusion of U.S. tax dollars, but the White House hopes the company will survive.

The bankruptcy filing, made in the U.S. Bankruptcy Court in Manhattan, marks the climax of a lengthy debate over the auto maker’s future after it sought a bailout from the U.S. government in December to stay alive. In the end, GM couldn’t complete its restructuring out of court and filed for bankruptcy-court protection to get billions more in aid from U.S. taxpayers.

The question now facing 56,000 auto workers, 3,600 GM dealers and the Obama administration: Will it work?

The U.S. government has agreed to provide GM with another $30 billion in aid, in addition to the $20 billion the auto maker has already borrowed, to see it through its restructuring and exit from bankruptcy protection. In return, the government will get a controlling stake in the company. The Canadian and Ontario governments are putting in $9.5 billion for a 12.5 percent stake.

The reorganization faces myriad risks, ranging from legal challenges to the uncertainty of when consumer demand for new cars will rebound. In becoming GM’s new owner, the government is also entering largely unexplored terrain filled with political minefields, notably the possibility of meddling by Congress in the company’s daily operations and business plans.

In bankruptcy, the auto maker will split apart into two companies: a leaner new GM and a so-called old GM, which will include the pieces that will be wound down. GM intends to accomplish the split through a Section 363 sale, which would transfer the new GM assets to an entity owned by the U.S. and Canadian governments, the United Auto Workers union and the company’s unsecured creditors.

Even if a new GM emerges swiftly from bankruptcy, the administration will face a thicket of challenges, including closing more than a dozen factories and shedding the Pontiac, Saturn, Saab and Hummer brands. Shepherding these unwanted parts of GM �?? the so-called Old GM — through liquidation in court could take years, with potential extra costs to taxpayers if the process bogs down.

GM’s restructuring has been carefully planned by the company itself and the Treasury Department, but it faces some uncertainty now that its fate is in the hands of a bankruptcy judge. The judge chosen to handle the case will have a major impact on the outcome of the case, especially if dissident bondholders mount a legal challenge to the restructuring. There’s also the risk that consumers will be scared off by the company’s Chapter 11 filing, causing sales to fall even further.

And unknown is how the cost of restructuring both GM and Chrysler LLC would have compared with the cost of letting both companies fail in terms of lost wages, disruptions among car-parts makers and the broader economic fallout. Chrysler, which could emerge from bankruptcy as soon as Monday, will be controlled by Italy’s Fiat SpA under its own risky revamping.

Bankruptcy should allow GM to pull off one of the most expedient downsizings in the industry’s 120-year history. Long hampered by laws, union strife and management practices that kept it from fast action to fix problems, GM plans to eliminate almost all of its debt, halve its U.S. brands, shutter 2,600 dealers and rewrite labor contracts almost overnight.

Emerging sometime this summer would be a GM with a cleaner balance sheet and slimmer operations than the company that has posted deep losses since 2005. GM has burned through $33.6 billion in cash the past four years. Under its restructuring plan, GM will shed more than $79 billion in debt, gain work-force savings worth billions of dollars a year, close unneeded facilities and reduce its dealer network by 40 percent.

The Obama administration, for its part, has navigated the GM rescue so far with notable speed, clearing away many of the biggest obstacles in just months with less drama than many expected. In six to 18 months, GM could be a publicly traded company again, administration officials said.

Over the weekend, owners of a majority of $27 billion in GM unsecured bonds agreed to a sweetened offer to trade their investment for stock. Days earlier, the UAW signed off on a range of concessions.

GM at the last minute also found buyers for some unwanted subsidiaries, including German-based Opel, which is being acquired by a consortium led by Canadian auto-parts supplier Magna International Inc., and the Hummer brand, whose buyer remained undisclosed.

Long-term success for the company depends on a critical question: When will consumer demand for new cars rebound, and with what force? New-vehicle sales in the U.S. have dropped nearly 40 percent since January, to an annual rate of fewer than 9.5 million a year. At that level, even Toyota Motor Corp., the world’s biggest car maker, is losing money.

Under the restructuring plan, the surviving New GM would break even when the rate of all new-vehicle sales in America reaches 10 million a year. In the view of many analysts, economic recovery should unleash pent-up demand, pushing U.S. sales far past GM’s break-even point, though probably not within reach of the historic peak of more than 17 million sales back in 2000.

Yet some worry the New GM will emerge under the same management as its predecessor, minus longtime Chief Executive Rick Wagoner. After pushing out Mr. Wagoner in March, the Obama car task force gave the top job at GM to Frederick “Fritz” Henderson, a 25-year veteran whose father worked at the company.

In an interview Thursday, Henderson said he understands that federal officials want results. “They’re expecting that we’ll get the job done,” he said.

GM won’t prosper without halting the lengthy slide in its U.S. market share, to 22% in 2008 from 45 percent in 1980. It faces the old perception of poor quality that turned swaths of the American market toward foreign-brand models.

“I won’t buy another GM,” said Dennis Brown, a banker in Cypress, Calif., whose 1980s-vintage Pontiac Fiero and Chevy Chevette suffered a litany of mechanical problems. Current GM models have fared better in quality rankings.

Beyond quality, trendsetters typically shun Detroit-brand cars, a problem that is especially prevalent among highly educated buyers who also tend to purchase higher-margin vehicles. Car buyers who are college graduates account for 70 percent of European-brand car sales in the U.S. and 55 percent of Asian brands — but only 39 percent of Detroit-brand car sales, according to J.D. Power & Associates.

GM hopes to counter its image as a maker of gas guzzlers with the 2010 introduction of the electric-powered Chevrolet Volt. Administration officials have played down the market potential of the Volt because of its expected $40,000 price tag, compared with less than $25,000 for the popular Toyota Prius, a hybrid gas-electric. Even at $40,000, moreover, the Volt will struggle to break even because of the cost of its technology.

GM’s new deal with the UAW, meantime, promises to deliver considerable cash savings, and has been billed as capable of putting GM’s labor costs on a level playing field with key rivals such as Toyota and Honda Motor Co. GM cut hourly costs, such as overtime provisions, supplemental unemployment and entry-level pay rates, by at least $1.5 billion annually.

But the car maker won’t be entirely out of the woods. It faces heavy retiree-related costs that will cut into profits on every car and truck it builds.

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