Chrysler & GM might need “considerably” larger loans
March 23, 2009 by Matt Brogan
Steven Rattner, the US Treasury’s chief auto adviser, has said this morning that both Chrysler and GM might need “considerably” larger loans.
Mr. Rattner said these loans would be in addition to the extra US$21.6 billion of added funds the car manufacturers have already requested.
Mr. Rattner went on to say Chrysler and GM’s turnaround plans are “somewhat ambitious” and probably “optimistic”.
US President Barack Obama is said to be using his automotive task force to help him decide whether to push go ahead with further loans, or force the manufacturers into bankruptcy. We will know more on this decision by March 31st.
GM CEO Rick Wagoner warned his company could be forced into bankruptcy if negotiations with the UAW and debt-holders fail. Rattner said he might have to set a deadline for the negotiations to end to expedite the process if the manufacturers could not be seen to do so alone.
“Part of why there’s a lack of appearance of movement is nobody wants to go first,” Rattner said. “You say here’s the deadline, everybody has to get there by this date or we’re going to do something else. In the course of what we say over the next 10 days, we will make very clear what the timetable is, by when it has to happen by, and also what we expect from them.”
To date, the two manufacturers have received US$17.4 billion in financial support.
Print it: 
Considerably more ? How much is that? Can the U.S. Taxpayers afford any more? In my opinion its a waste of money and the longer this drags on the more it is going to cost and the fact that this money will never ever be payed back makes it alot worse. The cost of this will turn out to be much much more than the jobs that will be lost in the short term and the car industry will have this massive massive loan hanging over its head forever. Its way past the time to say goodbye to GM and Chrysler.
GM really contributed to its own demise, building aesthetically unattractive vehicles that are also inefficient and unreliable. GM has been too complacent in the past, relying on blind patriotism, as well as consumer ignorance and insularity, to make sales. It’s “bigger is better” mentality just isn’t acceptable in the 21st century, where black gold is becoming a valuable and expensive commodity. It’s time to put this tarnished and irrelevant American icon to rest.
I got on here before Wheelnut did and that is a surprise. I smell Ford everywhere in this world now and thats the way it should be. I think we all should be driving around in Mustangs and get rid of those rebadged daewoo holdens. Give up GM and Chrysler for all the dud cars you make and let Ford take over the car world.
Quote ” I got on here before Wheelnut did and that is a surprise”
hahaha BK ,he will be on this arvo . This thread wasnt up when he left for work this morning ;)
I thought the CFO for GM said that they might only need a much smaller bailout because of their cost cutting measures that they have put into place were having a huge effect.
Well you can not have more money ! The tax payers gave all they are going to give and now its up to you to get your show back on the road, if you can not save your compnay with what you have recieved then shut your doors. Enuff is enuff ! The tax payers have paid to much for your products and now we are paying you to save your compnay and you wnat more ? NO ! No more free funds from us, get back on your feet and pay us back what you have recieved or shut the dorrs and turn out the lights ! This goes for the auto makers, the insurance companies and everyone trying for the bailout funding ! ENUFF !
Not sure why Aussies care what the US taxpayer spends their money on.
Remember, these are loans, unlike the bailouts to AIG, Citibank, et al.
They have to put in place a repayment plan, whereas those Banks & Insurance Companies haven’t had to.
JasonP….. yes its a loan but its a loan that can never be payed back because its getting out of hand now. GM are stuffed and each day lose more and more money. They can never return to profit in their current form.
Gm cant pay any loan back because they cant make money.
Frenchie….that is what I heard too. I think it was just wushful thinking on his part, I think Wagoner knows that they are totally stuffed and trying to put on a brave face……..its not working.
unf*kenbelievable. It’s that stupid american tipping culture that’s caused all of this.
or, like giving a teenager 25 bucks for the night and then him or her saying ‘but dad i need $20 for petrol and i owe my mate $12 and then wait, I’ll need at least another $35 for………………..on and on and on it goes.
Before you know it, the country’s even worse off.
This goes to show they have absolutely no idea what a screaming train wreck of a mess they’re in.
Throw more money at it……it’s gotta get better soon!
WVB..exactly. The mess GM is in is like an iceberg. Only a little has shown above the surface ……just wait until they look a little deeper !!
I was reading reports that thay will be needing over 50 billion in total .How many decades will that take to pay back and there still got no idea if thay will still survive.I say dont worry about them, when things pick up all the other car makers will pickup the slack and start employing more people it will all work out in the end thay got to put a stop to this crazzy money hand out its just to much now
Wheelnut must be having a RDO on this site as i havent seen anything posted by him yet.
Its not all completely GMs Fault – although a considerable amout of responsibility does lie with management.. if only Lutzy was GMs President instead of Rick Wagonner
A fair bit of responisbility also lies with the UAW
Because back in the mid 80s the US Federal Government [under George Bush Snr] forced the Car Companies [GM Ford and Chrysler] to accept the unreasonable demands set down by the UAW – which included a pay increase to approx $40p/hr and post employment health benefits; inorder to end a long running strike
They got their pay increases their health care payments and other bonuses etc However; over that time their build quality hasn’t improved nor has their efficiency or any other real measure of perfomance
Which is why I think that the Obama Government should now force the UAW to accept the deal that the Car Companies are offering.. which includes halving the pay rates back down to $20-25p/hr and getting rid of the health care benefits for retirees.
Given that these performance issues are only really limited to GM Factories in the USA Iwould have to say that GM should Fold – Yet If GM went so to would Opel and Holden which is unfair because over the same period of time build quality output etc at both Holden and Opel have improved or increased.
Therefore; I believe the only viable solution for GM is to pull out of the USA move RWD production to Austrtralia and FWD production to Europe.
If the UAW are too stuopid to realise that a job at a lower rate of pay is better than no job…. stuff em.
Wheelnut….You may have the best idea I’ve heard yet !