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Congress sets terms for auto industry bail-out

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Congress sets terms for auto industry bail-out


The stricken American auto industry’s drive for a government bail-out has moved up a gear, as some car makers claim they are close to collapse.

Amid plummeting sales General Motors, Ford and Chrysler have formally asked Washington for the equivalent of 27 billion euros in aid.

And there are signs they will get what they need. House of Representatives Speaker Nancy Pelosi said: “I believe that an intervention will happen, either legislatively or from the administration. I think it’s pretty clear that bankruptcy is not an option.

“There’s certain standards that we want to see. We want to see a commitment to the future. We want to see a restructuring of their approach, that they have a new business model, a new business plan. There has to be compensation reform.”

The plea for assistance came on the day sales figures showed the financial crisis is hitting the industry head on. GM’s sales, for example, dropped 40 percent in November.

Congress may have little choice but to support an industry that is said to account for one-in-ten American jobs.

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