CEOs seek federal aid; car sales tank
Associated Press
WASHINGTON — Humbled and fighting for survival, Detroit’s once-mighty automakers appealed to Congress with a retooled case for a bailout as large as $34 billion Tuesday, pledging to slash workers, car lines and executive pay in return for a federal lifeline.
GM and Chrysler said they needed an immediate cash infusion to last till New Year’s, and warned they could drag the entire industry down if they fail.
Chrysler LLC said it needed $7 billion by year’s end, and General Motors Corp. asked for a quick $4 billion as just the first installment of as much as $18 billion to stay afloat and weather even worse economic storms. Ford Motor Co. had a more upbeat report, but the other two members of the U.S. Big Three painted the direst portraits to date — including the prospects of shuttered factories and massive job losses — of what could happen if Congress doesn’t quickly step in.
“Failing to act now will hurt many American families and undermine our country’s economic recovery, far outweighing the costs related to supporting an industry that touches every district in every state of the nation,” Chrysler said.
“There isn’t a Plan B,” said GM Chief Operating Officer Fritz Henderson. “Absent support, frankly, the company just can’t fund its operations.”
New sales figures underscored the seriousness of the situation. U.S. light vehicle sales at General Motors and Chrysler plunged more than 40 percent in November, while Ford’s sales dropped 31 percent, battered by an economic storm that has sent consumer demand for new vehicles to lows not seen in decades.
Sales of the Avon Lake-manufactured Econoline van have fallen more than 24 percent compared with the same time last year, translating to 37,113 fewer vans sold in 2008. Last month, Ford sold 6,915 Econolines, compared with 11,100 vans sold in November 2007.
Ford, in far better shape than GM and Chrysler, asked Congress for a $9 billion “standby line of credit” to stabilize its business but said it didn’t expect to tap the funds unless one of Detroit’s other automakers went bust.
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Filed by Associated Press December 3rd, 2008 in Top Stories. Popularity: 2% |
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