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US Government demands recovery plan from carmakers

Friday 21 November 2008, 13:52
US Congress

Detroit's Big Three have been told to prove their have a "viable recovery plan” in order to get a $25bn (£17bn) bail-out from the US government.

General Motors, Chrysler and Ford have been given until December 2 to present plans. The leaders of both houses of Congress have said there will no money unless the companies can show that it will make a significant difference.

GM has already said it will run out of cash next year if it does not receive help.

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Some analysts believe Chapter 11 bankruptcy would finally force GM to adopt a lean, efficient structure.

However others, and the chief executives of the three carmakers, claim that millions of jobs will be lost if they do not receive state help.

 


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Your comments:
Perhaps we should the John Towers team over there? After all the talk GM has arrived at their own 'Rover time'. Simply put GM (Rover) made bad management decisions leading to wrong products and an inefficienct organisation. Learn from the UK (tax payer) mistake and let GM go at the first opportunity. The Iceage Commeth

iceage
22 November 2008, 11:13

Ref iceage comments. The GM situation bears no resemblance to Rover. GM had turned things arround and have a product portfolio second to none unlike the dated products that Rover were bringing to market in their final death throes. The new Opel/Vauxhall Insignia is a prime example of GM's capabilities and it is not by chance it has just been voted European Car of The Year 2009. The current situation with the 'Big 3' is a direct result of irresponsible business practices within the banking/finance sector which has enjoyed massive bailouts virtually without question. The case for helping the 'Big 3' or at least GM & Ford stacks up well in comparison. Do not overlook the interdependency of most if not all the manufacturers in the automotive world, with major component and platform cooperative arrangements. If Ford or GM were allowed to fail the repurcussions throughout the supply chain would be massive on a world scale. It is a very incestuous business, no aspect of the sector would remain unscathed. iceage take note - GM are working hard to prevent global warming with alternative propulsion systems & state of the art eco friendly production facilities - you may not melt after all - pity!

The Stig
23 November 2008, 11:31

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