The Big 3 CEOs are willing to work for a $1 salary next year if government aid to the manufacturers is cleared by Congress. (Autocar photo)
General Motors and Chrysler will collapse before the end of the year if the giant manufacturers don’t receive massive U.S. government aid now.
That was the stark message delivered to Congress in reports from GM, Chrysler and Ford, which set out drastic new business strategies and requested a combined total of $34 billion to stay solvent.
Urgent aid
GM needs $4b immediately and at least $10b more before the end of March to stay afloat.
In all, America’s biggest car manufacturer has asked for $18b, made up of $12b in soft loans and a $6b credit line.
"Absent such assistance, the company will default in the near term, very likely precipitating a total collapse of the domestic industry and its extensive supply chain, with a ripple effect that will have severe, long-term consequences to the U.S. economy," GM warned in its plan.
“We have no plan B,” admitted GM’s chief operating officer, Fritz Henderson, in a conference call with reporters.
Chrysler, meanwhile, requested $7b immediately. And Ford, seemingly best placed of all three, asked for $9 billion but noted that it would not access the money unless its situation worsened.
Future strategies
It was the second appeal to Washington within a month, with all three manufacturers seeking to present themselves as flexible, innovative and environmentally aware going concerns.
“As a company and as an industry, we readily admit that we have made our share of mistakes and miscalculations,” said Ford in its 36-page dossier. "We recognize that our business model needed to change, and we are changing it”.
All three companies focused on cutting emissions with new products. Ford said it was accelerating its hybrid and EV program while Chrysler and GM promised smaller, more frugal cars in future.
