General Motors aims to reduce the number of North American parts suppliers from about 1,500 to around 1,100 in the next 18 months as the company shrinks due to restructuring.

Global purchasing manager Bo Andersson told Reuters the automaker was still working to avoid a Chapter 11 filing but, in order to do so, it would need to have agreements in place with the bondholders and other stakeholders.

The US Treasury "were very clear, they want us to emerge as a company, outside of bankruptcy or inside of bankruptcy, debt free," Andersson said at an auto parts manufacturers' conference in Hamilton, Ontario.

He said that if the company were to enter bankruptcy protection, it would seek to have all its parts suppliers designated as critical vendors so they would continue to be paid.

"We want to continue to produce vehicles in bankruptcy and, therefore, we will name all our production suppliers as critical vendors with the logic that we need the parts, we want to produce the vehicles and we're not going to exclude some (parts makers)."

Andersson told Reuters that, due to the steep downturn in the auto sector, GM would only produce about 6m vehicles globally this year, compared to about 9.4m two years ago.

"2009 has been a great year," Andersson reportedly told the crowd of auto parts makers. "I have worked for President Obama for a few months and he named his best friend - his new dog, Bo - after me."