• Dec 5, 2008
It's taken two rounds of Congressional hearings, some major pride swallowing and three detailed business plans, but it looks as if the Detroit 3 will be getting the federal loans they need, though not as much they asked for. A deal was reportedly reached between Democratic leaders and the White House that will supply around $15 billion in federal loans to the struggling U.S. auto industry. While General Motors, Ford and Chrysler asked for a combined maximum of $34 billion, the $15 billion is designed to ensure they stay alive until March when the issue will be readdressed with the input of a fresh Obama administration. GM and Chrysler reportedly need around $11 billion to survive the new year, while Ford has said it would only need government aid if one of the other two went under.

We're hearing that a deal was reached between Democrats and the Bush administration late Friday after top Dem. Nancy Pelosi gave in to the White House and its position that the money should come from $25 billion in loans previously approved to help the automakers retool for energy fuel efficient vehicles, rather than drawing the aid from the $700 billion Troubled Asset Relief Fund for struggling financial institutions. In return, Pelosi is seeking a guarantee that the money would be replenished in "a matter of weeks."

Both the Senate and House of Representatives have confirmed they will be meeting on Tuesday to vote on the deal, and it's expected that strong oversight of how the loans are used, whether in the form of an individual car czar or committee, will be part of the final package.

Party on, Detroit.

[Source: Reuters, Photo by Brendan Hoffman/Getty]


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  • 107 Comments
      • 6 Years Ago
      I give it ten to fifteen years before they're back begging for more.
        • 6 Years Ago
        I give it a few months and they'll be invited back. Reading comprehension is key.
      • 6 Years Ago
      Att Greg Hoffman :

      As Shane From Australia stated, what about all the profits from all the American owned companies that leave from overseas markets and arrive on Amerian soil !!

      We must be careful in such foresight because if we preach buy American only then the rest of the world can preach the same to buy thier local products only or any non-American product and what happens to many of our companies then ... they'll die, it's as simple as that.

      So it is acceptable for GM to bring profits from Opel, Vauxhall, Holden, Daewoo etc back to the US but not for Toyota, Mazda, Honda etc to take profit back to Japan or BMW and M'Benz back to Europe.

      It's a shallow foresight from yourself wouldn't you agree.

      • 6 Years Ago
      Between the three.

      GM has said they need roughly $10B to survive until March 31st, 2009, and Chrysler $4B. Ford needs nothing, as Mullaly remains bored.

      Also, holy shit, it actually happened.
      CSI
      • 6 Years Ago
      I HAVE BEEN IN THE AUTOMOTIVE AFTERMARKET BUSINESS FOR 27 YEARS. I HAVE BEEN SUPPORTED BY BOTH OVERSEAS AND DOMESTIC DEALERS. I AM DOWN OVER 50% IN SALES THIS YEAR, AND HAVE LAID OFF HALF OF SOME VERY SKILLED EMPLOYEES WHO HAVE BEEN WITH ME FOR YEARS.
      I HAVE JUST BEEN CUT OFF BY A VENDOR THAT I HAVE BEN LOYAL TO FOR OVER 20 YEARS BECAUSE WE HAVE BEEN UNABLE TO PAY SOME INVOCIES THAT ARE NOW 60 DAYS OLD!!

      WHO DO I GO TO TO GET HELP WITH ADDITIONAL FINANCING????

      I HAVE NEVER WRITTEN A BAD CHECK IN THE LIFE OF MY COMPANY AND NEVER BEEN LATE TO A LENDER. HOWEVER, MY BANK WILL NO LONGER GIVE ME A SHORT TERM LOAN EVEN THOUGH MY BANKER STATED TO ME ON A RECENT VISIT THAT THEIR BANK HAD RECIEVED 35M FROM THE BAILOUT.

      WHERE DO I AND OTHERS LIKE US TURN NOW????
      • 6 Years Ago
      I just want to comment on this story.
      • 6 Years Ago
      How are GM and Ford of Europe doing through all this?
        • 6 Years Ago
        GM's Adam-Opel has asked the German government for $2 billion Euros in loan guarantees.

        http://www.spiegel.de/international/germany/0,1518,590906,00.html

        The European Automobile Manufacturers Association, which will be headed by Carlos Gnosn next year has asked the EU for a 40 billion euro loan to invest in the development of greener cars.

        Jaguar is in talks with the UK government for a one billion pound bailout.

        Ford of Europe is profitable and is projected to remain in the black.

        http://www.worldcarfans.com/9081124.018/more-european-automakers-looking-for-government-bailout

        Manufacturers like FIAT, Peugeot and Volkswagen are looking for some government intervention as well.

        The general malaise is spreading into other nations like Canada and Argentina where growing numbers of auto manufacturers are hurting big time.
      • 6 Years Ago


      Look at Apple in silicone valley. There computer are manufactured in China now used to be in USA. All the programming jobs and engineering jobs are still in cupertuno. Now if everyone bought Chinese I phones all the jobs in cupertuno go away. Cupertuno housing prices falls. If the Chinese came in then and put in a plant making their I phone here in the usa do you think the factory workers would be able to afford a 1 million dollar house. NO it lowers your quality of life.

      Buying any foreign product where every its made is bad for the USA. We purchase way too many products made overseas foreign the quality of our products lower. People buy a cheap TV sets therefor RCA had to lower the quality to sell.

      Same with CARS in some ways. Toyota and Honda spend the profits overseas where paying the American worker small amount of money.

      Research engineering and engine manufacturing says in japan.

      The real issue is the future you will lose the ability to manufacture because you design base is exported.

      The American public had been eroded for years from PR from Toyota making people think that 8% of a cars parts are USA. Labor to make a car is little and does nothing to make our future more competitive.

      But the huge 4000 profit goes to Japan.

      If you want to see the USA get worse just keep on buying foreign products.
      • 6 Years Ago
      nooo




      What a waste of money.....this money could have gone to better use
      • 6 Years Ago
      Does Obama realize that he is actually already in the government? I mean he IS a highly influential Senator in the ruling party; and so is his Veep, hello. But, he is hanging loose, letting other do all the talking??? I wonder how well that'll work when he is actually a, gulp, leader.
        • 6 Years Ago
        Obama is not a Senator. He resigned after he won the election. The Governor of Illinois has not yet named a replacement.
        • 6 Years Ago
        Obama probably called Pelosi and told her to let them use the money from the green tech fund. He is on top of things, though not in an obvious way.
      • 6 Years Ago
      $15!

      Off to In-N-Out they go...
      • 6 Years Ago
      I hate those bubbles.

      Stop it.
      • 6 Years Ago
      Sucks, when I needed money to eat and pay my mortgage from a job injury, the government did not help me and we ended up flat broke. I also ended up with permanent back pain because I had to go back to work to get a paycheck. Taught myself a new career and now my taxes go to pay for companies that, lets face it, are run like crap while people who need help don't get it. I have a really hard time understanding why were bailing these guys out when it seems we are not taking caring of our own.

      What good is a loan if it is never paid back?
        • 6 Years Ago
        Ding, ding, ding, ding,

        Give that man a prize.

        jpm100 is totally right, they dragged these guys out twice, spent days beating them up, then gave them money that was already promised to them, oh and it was less than half of what they asked for which around 10% of what they gave to Citi (not to mention the others) with no questions asked and no strings attached.

        All this so they could punt to the next administration who will most definately be waving their greenie fingers at them telling them they need to make cars that run on Unicorn piss and children's lollipop dreams for $10,000 a unit and to be released yesterday.

        Meanwhile, all those that are pissed that Mom and Pop are going out of business still don't get that the greedy ass bankers and investors are still living rich with our money (that they still have yet to use to open up credit- which is supposed to be why it was given to them!) while they figure more ways to deflect the accountability for why they didn't get what they expected when they threw 700B over the fence.
        • 6 Years Ago
        Of course they only gave them half. They want them back since they are such great public fodder.

        The Republicans can propagandize against unions. The Democrats can propagandize against corporations & capitalism. And they both get to distract everyone from the financial bailout.
        • 6 Years Ago
        comparing to a lot more money going to bailout banks this is not a too bad deal, plus, the current auto industry's qualms was more or less caused by the banks stupidities and greediness. The bottomline, at least the big three provide americans some real products, be it good or bad. what do the investment banks offer to americans? nothing. worse than that, they deprived people's hard earned 401K.
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