US President Barack Obama has warned painful restructuring is needed before more tax payers money will be handed over to America’s car makers.
While Obama announced he would not let the industry to disappear he said tough choices lay ahead for car giants General Motors and Chrysler.
‘‘We cannot and must not and we will not let our automotive industry simply vanish. Today I’m announcing that my administration will offer GM and Chrysler a limited additional period of time to work with creditors, unions and other stakeholders to fundamentally restructure in a way that will justify the investment of additional taxpayer dollars,’‘ Obama said.
‘‘What we are asking for is difficult. It will require hard choices by companies, it will require unions and workers who’ve already made extraordinary and painful concessions to do more, it will need creditors to recognise that they can’t hold out for the prospect of endless government bailouts,’‘ he added.
For Chrysler, the most troubled of detroit’s big three carmakers, Obama has demanded it submit a new recovery plan within 30 days. The US leader has called for a merger with Italy’s Fiat, saying the company is not currently viable.
Hard times for GM as well. It gets 60 days to come up with something new after Obama ordered its head Rick Wagoner fall on his sword earlier today.
Both car makers have already received billions in state aid. The third giant Ford, has not yet asked for more money but said it might need help in the future.