"Big Three" auto makers get a life line

On the brink of bankruptcy General Motors and Chrysler will share 13.4 billion dollars in federal loans with a March 31st deadline to prove they've financially viable or they'll have to pay the money back.

"The time to make the hard decisions to become viable is now or the only option will be bankruptcy," said President Bush.

If they comply, automakers can qualify for another four billion if Congress approves.

The loans will come from money Congress set aside to bail out banks.

President Bush didn't want to do that.

But with Congress unable to agree on an auto rescue, he says he had no choice.

"In the midst of a financial crisis and a recession, allowing the U.S. Auto industry to collapse is not a responsible course of action," said Mr. Bush.

Ford, the strongest of the big three financially, said no thanks to the government loans which will require debt-holders, dealers, suppliers, and union support.
Just as banks did, automakers will have to hand over stock, limit executive pay, halt dividends, plus cut their debts by two-thirds and bring workers' pay in line with what workers in foreign plants here earn by the end of next year.
The plan appears to give automakers the immediate relief they needed, while leaving future help largely in the hands of the Obama administration, and the next Congress.