Thursday, November 20, 2008

U.S. Senate reaches agreement on Auto bailout

The U.S. Senate has reached a deal on a compromise bailout plan for the Big Three automakers. However, it is still unclear whether this will pass both Houses.

ABC News reports:

opn-quote The agreement was hammered out by Republican Senators Kit Bond and George Voinovich, who were working with Democrat Carl Levin.

An auto industry source said the deal would use money from the $25 billion Congress made available to the automakers in October for fuel efficient vehicle programs. Speaker Nancy Pelosi has adamantly opposed using this money for anything but its intended purpose. To attempt to please Pelosi, under this deal, the Congress would come back in January and replenish the fund for fuel efficient vehicles.”cls-quote


Time will tell whether this is good enough to help the Big Three back onto their feet. Next move is up to Canadian governments.smleaf

1 comment:

  1. They will not change their dysfunctional behaviours, so the money is as good as gone already.

    End it now.

    The government of Canada could buy all the shares of the Big Three for @ $7 billion (far less than the industry is demanding) and simply close them and auction off the viable pieces (maybe Jeep, the "Caravan" van division, possibly GMC trucks and maybe Chevrolet) as well as the tools, equipment, buildings and land.

    I won't pretend to know what the resultant value of the auction would bring in, but it would still be far cheaper to buy the Big Three and close them down (even at a 100% loss) than bail them out.