G.O.O.D

So the US taxpayer will foot the bill, and then have the opportunity to take out loans to buy the over priced crap vehicles the new state run Auto Industry will produce.  Not a bad deal…for them.  For us?  Prepare for a $50,000 Gen II Yugo.

Source: AFP

The US Treasury said Friday it is “ready” to avert the collapse of the Big Three US automakers until Congress can address their problems, a spokeswoman said Friday.

“Because Congress failed to act, we will stand ready to prevent an imminent failure until Congress reconvenes and acts to address the long-term viability of the industry,” Treasury spokeswoman Brookly McLaughlin said.

The announcement came shortly after the White House said it would consider tapping a 700-billion-dollar financial rescue fund administered by the Treasury “to prevent a collapse of troubled automakers” after lawmakers failed to pass an alternative.

“Given the current weakened state of the US economy, we will consider other options if necessary — including use of the TARP program — to prevent a collapse of troubled automakers,” said spokeswoman Dana Perino, referring to the Troubled Asset Relief Program conceived to help financial services firms.

A 14-billion-dollar auto bailout effort collapsed in the US Senate late Thursday.

The House of Representatives on Wednesday had approved the White House-backed bill, crafted by Democrats, to rescue the ailing automakers.

The measure would have required the manufacturing giants to engage in restructuring to ensure their long-term survival and repayment of the government monies or face bankruptcy proceedings.

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Technorati Tags: US Treasury, auto bailout

General Motors Corp and Chrysler LLC

Source: Reuters

General Motors Corp and Chrysler LLC are considering accepting a pre-arranged bankruptcy as the last-resort price of getting a multi-billion dollar government bailout, Bloomberg reported, citing a person familiar with internal discussions.

In response to automakers’ bailout plea, staff for three members of Congress have asked restructuring experts if a pre-arranged bankruptcy — negotiated with workers, creditors and lenders — could be used to reorganize the sector without liquidation, Bloomberg said.

General Motors and Chrysler could not be immediately reached for comment by Reuters.

Industry executives and analysts say the immediate carnage from a bankruptcy of General Motors Corp, Ford Motor Co or Chrysler would spread throughout an industry that is bleeding cash in a global slowdown.

All three automakers have urged Congress to authorize $34 billion in loans and credit lines, saying they will restructure, and cut models, jobs and executive pay to remain viable.

The White House did not dismiss the industry’s $34 billion figure on Wednesday but said it was too early to say what it might support on an emergency basis.

Senate Majority leader Harry Reid wants to try to find a way to avert threatened bankruptcies in the U.S. auto industry with Detroit Three chief executives readying for a make-or-break hearing on Thursday on the bailout request.

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Technorati Tags: General Motors, Chrysler

Opel in Ruesselsheim, Mercedes in Bremen, Volkswagen in Wolfsburg etc.  Obviously Opel will be hit too by the trouble General Motors has, and without Volkswagen, there is nothing in Wolfsburg…

Wolfsburg Volkswagon Plant

Source: Reuters

* Porsche schedules 8 days of production stops at main plant

* Volkswagen may stop production in Wolfsburg for 3 weeks

* Audi says production halts are a precaution

* BMW says will cut further 400 temporary jobs in Leipzig

* Porsche shares down 8.8 pct, VW down 17.7 pct

(Adds Audi production stops, BMW temporary job cuts)

FRANKFURT, Nov 25 (Reuters) - German carmakers made another move to cut output levels towards the end of the year to offset slumping demand as the global economic crisis prompts consumers and companies to closely monitor their finances.

Sports car maker Porsche (PSHG_p.DE: Quote, Profile, Research, Stock Buzz) halted production at its headquarters in the southern German town of Zuffenhausen, for one day on Nov. 21, and planned to stop assembly for another seven days until end-January.

The company said on Tuesday it no longer saw its financial year unit sales to end-July reaching the previous same period’s level of 98,652 vehicles.

The German car industry accounts for about one in eight jobs in the country, according to German auto industry association VDA. The downturn in car sales has also started having an impact on other sectors such as chemicals and electronics.

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Technorati Tags: German carmakers