US considers car manufacturer bailout

Of late the manufacturing industry has taken a real battering especially in the US however US President-elect Barack Obama has revealed plans to put increased pressure on the heads of the nation’s three biggest car companies calling for their heads if they fail to reform their business so that a federal bailout can be achieved.

Obama’s comments have followed a draft legislation to lend $15 billion ) to General Motors, Ford and Chrysler although the deal is still being thrashed out as the loan over covers half of what the car manufacturers had originally requested.

The urgency of the situation has been put into prospective by Obama’s speech as he indicated that the jobless rates in the car industry are not acceptable and that effective restructuring is more important than simply throwing money at the situation.

The deal is meant to be a short term measure in order to make sure that the companies do not go under in the current financial market and it is believed that once Obama takes his position in the white house on January the 20th the three car companies will return to seek a longer term bailout.

There is still a lot of work to do behind the scenes in order to avoid bankruptcy and more focus is being places on efficiency and pointing business plans towards current market trends.

Both GM and Chrysler have applied to the energy department for funding for the development fuel-efficient vehicles to growth their range in this niche market.

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