Chris S

Because our futures are linked, I want you to know that General Motors is doing everything possible to deal with the impact the financial crisis is having on the domestic auto industry. Yet despite our successful efforts to restructure, reduce costs and enhance liquidity, we are facing an uphill battle with the current administration and Congress in securing a bridge loan.

That's why we need your help now. Simply put, we need you to join us to let Congress know that a bridge loan to help U.S. automakers also helps strengthen the U.S. economy and preserve millions of American jobs.

Despite what you may be hearing, we are not asking Congress for a bailout but rather a loan that will be repaid.

The consequences of the domestic auto industry collapsing would far exceed the $25 billion loan needed to bridge the current crisis. According to a recent study by the Center for Automotive Research:

rwheelz

Chrysler required a bailout loan in the past, and the government made hundreds of millions in interest on the deal. I am sure GM will get their loan soon enough.

QUIKAG

So many mixed feelings. UAW needs to offer more consessions, but having GM go under isn't a good option either.....

Chris S

Yes, the entire auto industry workforce (UAW, execs, and others) need to sacrifice. This money should come w/ strings attached to give them a fighting chance of long term viability, not just extend their demise.

I believe $25B is chump change vs. the impact their failure would have on the economy...and it s/b paid back.

erik

I thought Bush and Congress already ear marked a $25 billion loan for the US automakers and this was approved. Then I was hearing that the Dems wanted the automakers to come under the TARP program.

Someone straighten me out please.

wills2k106

Democrats are pro-union and want to offer the "bailout" to keep the UAW alive, but don't have the votes in the short term. Republicans want them to file bankruptcy to clean house and come out with leaner production similar to the imports that are made in America. Bankruptcy however will cause customers to run for the hills, concerned about warranty coverage, parts supplies, service departments, etc. The viability of the company after chapter 11 is questionable. Both parties plans have their pros and cons; the worst thing they could do is nothing. And to no ones surprise that is exactly what the government is doing.

GM will get the money when there are more D seats in the new year but that may not be soon enough. They are blowing through cash faster than if they had lit it on fire and they may not make it to the new year. I agree with above, lend the money with a multitude of caveats designed for long term viability not just keeping your head above water.

wills2k106

http://usnews.rankingsandreviews.com/cars-...from-Uncle-Sam/

The first $25 billion loan was approved in September but won't be dispensed until 2009, but it is really only for the re-tooling of factories for more fuel efficient vehicles and costs associated with said vehicles. The problem GM is having is that they don't think they will make it to 2009.

Jimmies

Wills has it nailed pretty well in a non-partisan fashion. I believe however, that bankruptcy won't have too much effect on consumer confidence (because it's ****ed as it already is). Airlines have done it before, as have many other companies of significant consumer exposure.

Penforhire

I've been watching the congressional hearings. What strikes me hardest is how none of the three CEO's had a direct answer for how the $25B they are asking for will get them through the current crisis (assuming at least 18 month economic recovery time). They really did pick $25B out of thin air!

Wagoner was pretty funny in his answer to whether he'd take $1 compensation until they get profitable, as Lee Iococca did in the 80's. I translate his answer as "No F'ing way!" Sure, he'll shave his compensation to 25% (of a very large number) while Rome burns.

I'm starting to come around to the other side. Let the failing companies fail. Go through bankruptancy to restructure immediately. Support the survivors. Maybe we don't really need three American auto makers.

marrenr813

Let them sink! It sucks, but it is what we have to do.
The short term will be tough, but it will be worth it in the long run. GM is an inefficient company; they need to go bankrupt to fix this inefficiency.
The have been "going bankrupt" for a long ass time. Lets not try to prevent the inevitable.