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Deutsche Bank Managing Director Rod Lache predicted that GM will need a modified restructuring through some form of bankruptcy in 2009, even with the recent federal loan. “The chances are greater than not that there will be bankruptcy, at least for GM,” Lache said at a Society of Automotive Analysts conference at the ongoing Detroit Auto Show. “But it won’t be the disruptive, scary bankruptcy that suppliers fear.” It’s hard to imagine a non-scary GM bankruptcy, especially since Lache also predicts that part of the process will be a messy renegotiation of its UAW contract, including a disputed conversion of the controversial Voluntary Employee Beneficiary Association, or VEBA, into equity for the troubled firm.

Without a court order Lache worries that GM won’t be able to get all involved parties to agree to its debt restructuring. Labor issues have been an ongoing sore spot in the battle to save GM. The friendly ‘light’ bankruptcy sounds a bit messy and scary already.