Citigroup will work with both GM and Chrysler to identify suppliers and decide how to distribute the aid program, Autonews reported. Bob McKenna, president of the Motor and Manufacturers Equipment Association claims he got the news from the two manufacturers, who told them that Citigroup will be in charge of the fund.
Still, no official notification from the US Treasury Department was sent the Motor Association, nor any of Citigroups official were available for comment. Nevertheless, McKenna said it will be some three to four weeks until the aid will arrive, so there is time for further developments.
The rescue program for the auto suppliers is intended to “provide up to $5 billion in financing, giving suppliers the confidence they need to continue shipping parts, pay their employees and continue their operations,” as the Treasury Department said in a statement late last week.
The aid will be granted by the Treasury department in the form of government guaranties, aimed at reassuring the auto suppliers their deliveries will be paid for, regardless of what happens to the recipients of the goods.
Speaking of recipients, both GM and Chrysler will face on Tuesday one of their greatest challenges to date. Their expectations ($16 billion for GM and $5 billion for Chrysler) are likely to be met, as Michigan Senator Carl Levin said yesterday "it is clear" further assistance will be granted to the two.