President Bush has come to the aid of the U.S. auto industry. With just a month left in his two-term presidency, Bush offered $17.4 billion in loans to the Big Three.
The Big Three will have $13.4 billion in loans available to them over the next month. GM will be able to borrow $9.4 billion and Chrysler can borrow $4 billion. Ford has repeatedly said that it doesn’t need any government assistance, but that a failure of GM or Chrysler would cripple its suppliers and seriously endanger the company’s future. An additional $4 billion will be available in Feb.
The Bush administration’s auto industry loans come with stipulations very close to the ones in Congress’ failed bailout from earlier this month. These loans will give the automakers until March 31 to present restructuring plans that will prove their viability. The bill shot down by Senate republicans had the same requirements. If the companies can’t come up with a survival plan in the next three months, they will have to start repaying the loans immediately, MSNBC reports.
"Allowing the auto companies to collapse is not a responsible course of action," President Bush said. He added that a bankruptcy would be "an unacceptably painful blow to hardworking Americans."
Photo via AP.