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Democratic leaders in Congress asked the Bush administration on Saturday to provide more aid to the struggling auto industry, which is bleeding cash and jobs as sales have dropped to their lowest level in a quarter-century.
House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid said in a letter to Treasury Secretary Henry Paulson that the administration should consider expanding the $700 billion bailout to include car companies.
"A healthy automobile manufacturing sector is essential to the restoration of financial market stability, the overall health of our economy, and the livelihood of the automobile sector's work force," they wrote. "The economic downturn and the crisis in our financial markets further imperiled our domestic automobile industry and its work force."
There was no immediate comment from the Bush administration about the request to broaden the $700 billion financial industry bailout so automakers could get a share.
Automakers already want an additional $50 billion in loans from Congress to help them survive tough economic conditions and pay for health care obligations for retirees. The companies are seeking the loans as part of an economic aid plan that is now more likely to come together early next year rather than in a postelection session of Congress this month.
Top executives of General Motors, Ford, Chrysler LLC and the president of the United Auto Workers met with congressional leaders Thursday to discuss the loans. The money would be on top of the $25 billion in loans that Congress passed in September to help retool auto plants to build more fuel-efficient vehicles.
"We left the meetings convinced that our nation's automobile industry — the heart of our manufacturing sector — and the jobs of tens of thousands of American workers are at risk," Pelosi, D-Calif., and Reid, D-Nev., said in their letter to Paulson.
Automakers want the new loans included in an economic aid plan that is now more likely to come together early next year rather than in a postelection session of Congress this month. If Congress approved more loans, it would come with strings attached. Potential protections include limits on executive compensation, awarding the government preferred stock in the companies and a suspension of dividend payments to investors.
GM, the nation's largest automaker, warned Friday that it may run out of money by the end of the year after piling up billions in third-quarter losses and burning through cash at an alarming rate. GM's chairman and chief executive, Rick Wagoner, said the company will take every action possible to avoid bankruptcy. GM has planned more job cuts, including another 5,500 salaried and factory workers, but company officials warn that those measures alone would not be enough and that federal aid was essential.
Ford, which recently announced it would slash more than 2,000 white collar jobs, also has seen a rapid decline in its cash supply. But it is in better shape because the company borrowed billions of dollars in 2007 by mortgaging its factories. The company said it had enough cash to make it through 2009.
"We must safeguard the interests of American taxpayers, protect the hundreds of thousands of automobile workers and retirees, stop the erosion of our manufacturing base, and bolster our economy," the Democratic leaders in Congress wrote.
President-elect Obama said Friday his transition team would explore policy options to help the auto industry. Obama's economic transition team includes two allies of the U.S. auto industry — Michigan Gov. Jennifer Granholm and former Rep. David Bonior, D-Mich.
© 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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 | Automakers seek additional $50 billion in loans | Associated Press | Fri Nov 7 | 26 |
| Meltdown 101: Why automakers might get bailed out | Associated Press | Fri Nov 7 | 4 |
 | Driver's Seat: GM staring into abyss | Associated Press | Fri Nov 7 | 212 |
 | Democrats Urge Paulson to Weigh Aid For Automakers | The New York Times | Sat Nov 8 | 0 |
| GM grapples to avoid filing bankruptcy as cash vanishes | The Detroit Free Press | Sat Nov 8 | 0 |
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{"commentId":3980222,"authorDomain":"paulpeg1"}
Would an CEO of an auto company be willing to cap his pay and perks in return? Their errors got them in this position!
Cap the auto execs at ten times the workers pay, they get a raise when the workers do.
{"commentId":3980222,"threadId":"413660","contentId":"2088952","authorDomain":"paulpeg1"}
#1 - Sat Nov 8, 2008 2:00 PM EST{"commentId":3988715,"authorDomain":"BlueLeftHand"}
Cap the auto execs at ten times the workers pay, they get a raise when the workers do.
That works.
{"commentId":3988715,"threadId":"413660","contentId":"2088952","authorDomain":"BlueLeftHand"}
- 1 vote
{"commentId":3981830,"authorDomain":"jdfry17"}
BULL S--T!!!! America's Big 3 and the Oil companies lobbied againt getting better gas milege for years and gave America the gas hogs they now have. They influenced Congress to to the point where we are now. The so called foreign companies continued to improve on milege and emissions and when the price of gas went belly up the American public started purchasing more of the more economical foreign autos. Many of these are made in the good old USA, by people who are not unionized, but still put quality into there product. They are not getting as rich as the union people, but are smart enough to live within their means. I feel sorry for union people, but as the Good Book says, "As you sow shall you reap".
I do have an answer to the Big 3's problems: They were "bed partners" with the oil industry for the last 50 or more years, the oil industry just posted a $400 billion profit for the 3rd quarter this year, let those Bastards bail'em out, not the American taxpayer. He's got enough worries of his own at this time.
{"commentId":3981830,"threadId":"413660","contentId":"2088952","authorDomain":"jdfry17"}
- 2 votes
#2 - Sat Nov 8, 2008 4:19 PM EST{"commentId":4320753,"authorDomain":"bevos4"}
There you go John! You have hit the nail on the head! Hard! I think though, that the best thing for our economy is for the Big Three to go under. That would get rid of a VERY EXPENSIVE union, VERY EXPENSIVE CEOs , and VERY EXPENSIVE workers. Get rid of all of that and rebuild with Normal wages for workers as well as CEOs. No Union!!! People can unite on their own if they need more money or are not being treated fairly.
{"commentId":4320753,"threadId":"413660","contentId":"2088952","authorDomain":"bevos4"}
- 1 vote
{"commentId":3983420,"authorDomain":"bluecollarbytes"}
Let Democrats step forward and take the responsibility and 'credit' for this bailout.
Obama has promised to eliminate gas-powered vehicles in 10 years. What better time than now to destroy the evil carbon-based auto industry? Let him show the courage he wore on his sleeve while running, putting his actions where his mouth is.
IF on the other hand it was all lies, give Detroit its bailout.
{"commentId":3983420,"threadId":"413660","contentId":"2088952","authorDomain":"bluecollarbytes"}
#3 - Sat Nov 8, 2008 7:03 PM EST{"commentId":3988746,"authorDomain":"BlueLeftHand"}
Why not bail out Detroit, with conditions?
(1) Fire the crappy execs, and for the ones that remain, cap their salary, bonuses and perks.
(2) Ditch the brands that don't work.
(3) Ditch the vehicles that don't work within the functioning brands.
(4) Take the investment money and retool the factories to build hybrids and hydrogen-powered cars.
(5) If you want US money, you have to bring the jobs back from Mexico and Canada.
This is painted in broad strokes, but it's a framework for saving the industry and jobs, saving the planet.
You got a better idea?
{"commentId":3988746,"threadId":"413660","contentId":"2088952","authorDomain":"BlueLeftHand"}
- 2 votes
{"commentId":3984202,"authorDomain":"mittel"}
I find it laughable that the UAW is involved in talks to get money from the government. The union is responsible for sucking the auto industry dry. They have made it so expensive to build (inferior) cars, that the industry can't survive. I grew up in a GM family and saw first-hand how the union forced the company to pay high wages and benefits, while encouraging decreased production from the workers. The UAW is legalized blackmail. Thank God I went to college and got the heck out of Michigan.
{"commentId":3984202,"threadId":"413660","contentId":"2088952","authorDomain":"mittel"}
- 1 vote
#4 - Sat Nov 8, 2008 8:24 PM EST{"commentId":3985832,"authorDomain":"jgbennett56"}
If the government (us taxpayers) agrees to bail out their sorry butts, they should cancel all union contracts, ban strikes and reduce executive and production employee salaries by at least 30%. Even then, they will still be paid more than 90% of the country. If they don't like it, they can join the rest of us unemployed, except that the union will still pay them more than 80% of the country while being unemployed.
On second thought, let the UAW bail out the auto industry. After all, they have a ton of money blackmailed out of the company and union employees. It looks like the UAW will get what they deserve for killing the goose that laid their golden egg!
{"commentId":3985832,"threadId":"413660","contentId":"2088952","authorDomain":"jgbennett56"}
- 1 vote
{"commentId":3997517,"authorDomain":"debmark"}
Sir, are you a Union member? Do you know for a fact what autoworkers make? I am assuming not because my husband does work for Chrysler and he is not paid 90% more than most Americans. The management of these companies are awful but do not blame the floor workers for their ineptitude. That would be like blaming the voters for Bush's mistakes. The Unions did not "kill" the goose, the companies being in bed with oil companies for so long is what is killing these companies. I know this is falling on deaf ears but Unions work for livable wages, benefits and healthcare for all. Do not believe for one minute that these fine upstanding CEO's would give anything to their employees if not negotiated by the Union and in turn non-Union companies are compelled to follow suit.
{"commentId":3997517,"threadId":"413660","contentId":"2088952","authorDomain":"debmark"}
{"commentId":4320793,"authorDomain":"bevos4"}
Jim and Nan, you are both very right!!!!!!!!! UAW AND CEOs
{"commentId":4320793,"threadId":"413660","contentId":"2088952","authorDomain":"bevos4"}
{"commentId":3985874,"authorDomain":"theseetons"}
When it takes six years to produce a new type of auto, and the Honda like auto systems can produce in a year, what does it say about why would you pour funds into a sewer.
One reason for failure is the unions, but it is the auto companies culture of turf. If a CEO can not go into a meeting to demand change in a reasonable time. That person does not have the stuff to be the CEO. If the engineers can not perform you replace them.
It is sad that they have time since 1977 to come up with a new type of autos.
{"commentId":3985874,"threadId":"413660","contentId":"2088952","authorDomain":"theseetons"}
#5 - Sat Nov 8, 2008 11:31 PM EST{"commentId":3987522,"authorDomain":"bobneve1"}
They were "bed partners" with the oil industry for the last 50 or more years, the oil industry just posted a $400 billion profit for the 3rd quarter this year, let those Bastards bail'em out,
It's funny I agree with all the statements above. But you all know darn well the big 3 are "our" car companies. The CEO of GM recently admitted on 60 mins that is was huge mistake to shred the electric cars back in 1995 he looked like the cat that ate the canary on that one. If Congress doe's decide to bail them out then there has to be a mandate for what they will be producing and what they will be developing. Oops am I saying "regulation" oh my god....
{"commentId":3987522,"threadId":"413660","contentId":"2088952","authorDomain":"bobneve1"}
#6 - Sun Nov 9, 2008 6:24 AM EST{"commentId":3988045,"authorDomain":"EEEEEMAN"}
This industry needs to realign the boards of directors, any business that hadn't seen the writing on the wall regarding the middle class need for fuel and safe midsize autos should go bankrupt, the profits made should have been used for research on quality and development. Addios to big three.
{"commentId":3988045,"threadId":"413660","contentId":"2088952","authorDomain":"EEEEEMAN"}
- 1 vote
#7 - Sun Nov 9, 2008 8:50 AM EST{"commentId":3988535,"authorDomain":"fatcat349"}
I agree - bankruptcy worked for the airlines. They didn't go out of business, and were forced to use their own funds to clean out their houses and restructure. I bought a hybrid three years ago because I read the handwriting on the wall, but the auto industry kept rolling out huge SUVs and trucks. They were not concerned with the national economy or the plight of the middle class then, only their profit and executive compensation. If not forced into it, I don't see them making any changes while burning through the taxpayers' money. BTW I've even heard talk that 44 wants to provide financial help to the unions. Say what?!
{"commentId":3988535,"threadId":"413660","contentId":"2088952","authorDomain":"fatcat349"}
- 1 vote
{"commentId":4004050,"authorDomain":"EEEEEMAN"}
Sound business decisions require current and future marketing developments. The auto industry has been supposedly researching and developing not only fuel efficient autos, but alternative energy sources of power. Now after 50 plus years the only thing there is on the shelf is a six cylinder engine that will give 15 ti 22 miles per gallon using current fuel standards. Sorry not good enough and the boards of directors for all of the big three should be charged with collusion and regulation of industry product?
{"commentId":4004050,"threadId":"413660","contentId":"2088952","authorDomain":"EEEEEMAN"}
- 1 vote
{"commentId":3990086,"authorDomain":"paulpeg1"}
Take a serious look at why the American auto companies are in trouble. Congress has done little to pass consumer protection laws to force them to build better cars (like no regulation). Yes you have more of a chance of survive a crash in one now, but overall quality?
They have basically built what they wanted to, attemped to force them on the consumer, and whined when they didn`t sell. Prices of them have risen much faster overall than American wages complicating the issue.
Auto companies whine about the benefits they provide to Union workers, but never about compensation provided to executives with losing performance, LOL fair and balanced?
A step towards helping the Auto companies would be a national health care plan if this is such a big issue for them? They are now buying out older workers, new workers get paid less, less benefits. They may be cutting their own throats, their most loyal buyers were their own employees, and the new ones may not be able to afford their products.
57 years old, I have only owned 2 new cars (back when they were cheap). Just a poor investment to me. Always seem like a lot of money to buy a problem, just transportation. I could fix them myself so 15,000 for a ride wasn`t a better plan than 5000.
Rides make you cool? Your just a fool. Much happier debt free.
{"commentId":3990086,"threadId":"413660","contentId":"2088952","authorDomain":"paulpeg1"}
#8 - Sun Nov 9, 2008 12:21 PM EST{"commentId":3990686,"authorDomain":"bevos4"}
They should have been paying attention. When we were BEGGING formore economical cars. When Japan came in with more economical cars, they thought they were invincible. They, the big 3. They should have been listening. TOO LITTLE, TOO LATE. Let them go the way of the little people when we don't handle our finances properly
{"commentId":3990686,"threadId":"413660","contentId":"2088952","authorDomain":"bevos4"}
#9 - Sun Nov 9, 2008 1:13 PM EST{"commentId":3992501,"authorDomain":"Rants"}
If the Democrats want to bail out the auto industry, let them wait until January 20th. They want Bush as a scape goat, again, so it doesn't hurt their 9% approval rating.
{"commentId":3992501,"threadId":"413660","contentId":"2088952","authorDomain":"Rants"}
#10 - Sun Nov 9, 2008 4:21 PM EST{"commentId":3995134,"authorDomain":"Sincere"}
I have to say this is really treading ice, if you don't bail them out then you lose one of the few remaining companies that manufacture on American Soil and with it will increase the massive blood flow in the pool of unemployement, but on the other is the investment in the company really feeisble? They would have major re-structuring and a lot of shake ups to do and then get on a direction that would make sure a return on said investment and do I really trust that the gov't is going to be honest said of any money earned on these bailouts and if there isn't someone someone that is gonna skim the books, and defraud the American people in the end. I think these bailouts maybe in good in faith to slow bleeding & may just blow up in everyones face. Our gov't wanted to sit back and act blind to issues and not regulate companies that need regulation. From Auto makers to private Banks and credit card companies outragous Interest rates and Business Practices and now it is biting the world in the ass,
I fear that the only feesible option is to bleed out and start over because patch jobs only hold for so long and with out proper new steps in repairing the foundation as a whole these patches will tear again. We our a Free Enterpise nation and I am sure if any of these companies have a right to squirm their way out of a process of what goes eventually comes down
{"commentId":3995134,"threadId":"413660","contentId":"2088952","authorDomain":"Sincere"}
- 1 vote
#11 - Sun Nov 9, 2008 8:35 PM EST{"commentId":4320881,"authorDomain":"bevos4"}
SO WHAT if we lose them? SO WHAT if they are American? THEY ARE SCREWING THE AMERICAN PEOPLE.!!!!!!!!!!!!! And all the time they are, they are making money hand over fist.
{"commentId":4320881,"threadId":"413660","contentId":"2088952","authorDomain":"bevos4"}
{"commentId":3995242,"authorDomain":"loveworkingfromhome"}
Unions killed the auto makers
{"commentId":3995242,"threadId":"413660","contentId":"2088952","authorDomain":"loveworkingfromhome"}
#12 - Sun Nov 9, 2008 8:46 PM EST{"commentId":3997543,"authorDomain":"debmark"}
Unions did not such thing. The CONSUMERS killed the automakers. Demanding Hummers and SUV's just 2 years ago but now want a totally different vehicle. The management did not do a good job with R&D but Unions are for the working people, corporations are for share holders.
{"commentId":3997543,"threadId":"413660","contentId":"2088952","authorDomain":"debmark"}
{"commentId":3997873,"authorDomain":"Sincere"}
I have to agree it wasn't to long ago that Escalades were the trend & a must have until everyone learned that they kill your wallet at the pump. we helped kill them the rising gas prices and econimic decline was just the knockout punch but it is typical of us while there are groups screaming for more civil responsiblity for the enviroment and celebirties starting to go green years ago, it couldn't be more typical that going green doesn't become a great new trend until their is an economic crisis now every one is screaming for green friendly cars and technology cause we our all bleeding cause of the effects, sounds a bit like Karma or just our ignorance biting us in the ASS!!!
{"commentId":3997873,"threadId":"413660","contentId":"2088952","authorDomain":"Sincere"}
- 1 vote
{"commentId":3999915,"authorDomain":"LexieLynn"}
Please help me understand - Why are the three U.S. automakers asking for help from The United States of America (and U.S. TAXPAYERS) when just last week GM opened a new plant in Russia ? Perhaps they should be asking for a 'bailout' from Russia..........
{"commentId":3999915,"threadId":"413660","contentId":"2088952","authorDomain":"LexieLynn"}
- 1 vote
#13 - Mon Nov 10, 2008 9:47 AM EST{"commentId":4000374,"authorDomain":"debmark"}
Agreed. It is a troubling situation. But there are close to 2 million American jobs tied up with the automakers. The management of these companies seem to have strange priorities but to close the American plants would make the current economy seem great.
{"commentId":4000374,"threadId":"413660","contentId":"2088952","authorDomain":"debmark"}
{"commentId":4320921,"authorDomain":"bevos4"}
Or Canada, Or Mexico. Or Europe. Or anywhere else they moved to and screwed AMERICANS out of jobs.
{"commentId":4320921,"threadId":"413660","contentId":"2088952","authorDomain":"bevos4"}
- 1 vote
{"commentId":4320986,"authorDomain":"bevos4"}
Debmo, That's what they are depending on. They already got loans from the first bail-out of $400b, And the first thing they did is give themselves, the CEOs , $30MILLION in bonuses. They got themselves into this mess, let them get themselves out of it.
{"commentId":4320986,"threadId":"413660","contentId":"2088952","authorDomain":"bevos4"}
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