WORLD> America
|
WORLD> America
|
|
Chrysler urges bailout, Washington split
(Agencies)
Updated: 2008-11-14 08:50 Bailout Measures Debated Analysts have warned that any government assistance, which they say is imperative for GM to survive through early 2009, would come at a significant cost to existing shareholders.
Democratic leaders have called for emergency aid for the auto industry in addition to $25 billion of low-interest loans previously approved to support capital investment to meet new fuel economy mandates. Lawmakers will hold a hearing next week to consider a bill to give another $25 billion in federal loans to US auto manufacturers, possibly using part of the $700 billion financial market rescue law enacted last month. But the White House said on Thursday it was not the intent of Congress to use the financial rescue package to help ailing US automakers, while US Commerce Secretary Carlos Gutierrez told Reuters that opening the financial bailout fund to one industry was "not a good idea. House Republican leader John Boehner said spending billions on a bailout with no promises of reforming the companies was "neither fair to taxpayers nor sound fiscal policy." GM, Ford Motor Co and Chrysler have been burning cash as the global credit crisis accelerated the decline in US auto sales and placed severe limits on corporate and consumer borrowing. GM ended September with $16.2 billion in cash, down from $21 billion at the end of the second quarter. The downturn also has affected the plans of non-US-based automakers in the United States. The Nikkei newspaper reported that Toyota Motor Corp was considering delaying the start of production at its new Mississippi plant until 2011 or later, from 2010. Standard & Poor's lowered credit ratings on two North American auto parts suppliers and placed the ratings on 14 other suppliers on negative watch, citing their exposure to the three US automakers. "The credit watch listings reflect the increasingly beleaguered state of the Michigan-based automakers and the multiple scenarios, almost all of them negative, that could play out over the next few weeks or months," S&P said in a report released on Thursday. |
