White House Asks Congress to Accelerate Auto-Loans

With the global recession pushing American carmakers close to bankruptcy, the White House today asked the Congress to accelerate loans to help the automotive industry minimize loses. Congress has already approved a $25 billion funding package, but White House officials are considering the possibility to set up a second loan program for interested companies.

"We're open to ideas from Congress to accelerate funds they've already appropriated in the auto loan program -- as long as funding will continue to go to viable firms and with strong taxpayer protections," White House spokesman Tony Fratto was quoted as saying by Autonews.

General Motors, Chrysler and Ford reported extremely low October sales, with million of dollars loses and production cuts, all of them caused by the global recession. Beside all of these, analysts predicted that these three American car giants may experience even higher loses in the first months of 2009, with increasing possibility to see them going bankrupt.

"Without government assistance, we believe that GM's collapse would be inevitable, and that it would precipitate systemic risk that would be difficult to overcome for automakers, suppliers, retailers and sectors of the U.S. Economy," Deutsche Bank's Rod Lache told msnbc.

Barrack Obama's transition team already discussed with President Bush the possibility of introducing a second loan program, Autonews added, but no further details were provided. “It was a private meeting,” White House spokesman Tony Fratto said. "Obama asked for a second stimulus and to use existing measures to help the auto industry," a source close to talks told msnbc.

“The Bush administration has not dismissed outright the possibility of extending emergency assistance to the automakers,” Autonews added in the report.
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About the author: Bogdan Popa
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Bogdan keeps an eye on how technology is taking over the car world. His long-term goals are buying an 18-wheeler because he needs more space for his kid’s toys, and convincing Google and Apple that Android Auto and CarPlay deserve at least as much attention as their phones.
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