Auto Industry Leaders Ask Congress for Loans

Though the $25 billion loan to automakers producing advanced technology vehicles is a considerable sum, leaders from Chrysler, Ford, General Motors, and the UAW met with Congressional leaders this week to discuss another $25 billion loan.

While the first loan, administered by the U.S. Department of Energy, is designed to encourage the development and production of fuel-efficient vehicles, each of the ‘Detroit Three’ are looking for money that can be used for other purposes. One such use could be the new retiree health-benefit funds (VEBAs), which were created during last year’s collective bargaining agreements with the UAW.
Although the U.S. Treasury and Federal Reserve technically have the authority to grant loans, insiders suggest it could take some pushing from Congress to get things rolling. As a result, Bob Nardelli, Alan Mulally, Rick Wagoner, and Ron Gettelfinger, met with House Speaker Nancy Pelosi, Senate Majority Leader Harry Reid, and John Dingell, chairman of the House Energy and Commerce Committee.
It’s still unknown if the three were convinced enough to petition the U.S. Treasury to craft a second loan, but Dingell remarked that the meeting was “one of the most productive” sessions he’s witnessed in his 53-year career.
Source: Automotive News