big three

For Detroit’s automakers, the bad news just got worse. Just hours after Chrysler announced a request for $5 billion more in federal help to prevent bankruptcy, General Motors indicated it might need as much as $16.6 billion more. Combined, the two companies have already received $17.4 billion in emergency loans since December.
From The Associated Press:

Remember when the Bush administration was opposed to tapping the $700 billion Wall Street bailout to help Detroit’s Big Three?
Fugetaboutit.
The Treasury Dept. announced last night that it will spend $6 billion from that fund to bail out GMAC, the flailing auto finance company whose reluctance to lend to riskier loan applicants has contributed significantly to [...]

More bad news for Detroit: Toyota announced yesterday that it expects to lose $1.7 billion for the fiscal year ending March 31 — the first annual loss for the company in 70 years. From The New York Times:
Analysts said Toyota’s downward revision, its second in two months, showed that the worst financial crisis since the [...]

When Senate Republicans last week blocked Democrats’ efforts to bail out General Motors and Chrysler, which say they’re near bankruptcy, the White House was quick to swoop in to announce that it would lend the help that Congress didn’t.
Aside from the comedy surrounding that development (the Bush administration’s original refusal to help the automakers was [...]

In a move that spells nothing but bad news for Detroit’s struggling automakers, Toyota announced yesterday that it’s suspended plans to produce its Prius hybrid in the United States.
Why is that bad news for the Big Three? Because there’s been this line of argument that Ford, General Motors and Chrysler would be performing splendidly right [...]

GOP senators have been urging GM to adopt a more efficient business model, like that of the foreign auto companies with operations throughout the South. What’s been left out of the debate, though, is the billions of dollars in public perks Nissan, Mercedes and others have enjoyed for setting up shop in the United States.

A GM bankruptcy would be unprecedented, and probably controversial, because the company owns physical assets worth about $160 billion, directly employs 90,000 Americans and is an integral part of the U.S. economy. While the White House has signaled that it may come to the rescue in the short term, the pain of downsizing the auto giant would have a ripple effect across the economy.

Check out this exchange between reporters and White House spokeswoman Dana Perino this morning after Perino announced that the White House “will consider” using funds from the Wall Street bailout to help Detroit:

Now it’s the Bush administration’s time to cave. In a statement issued this morning, White House spokeswoman Dana Perino said the Treasury Dept. “will consider” using a portion of the $700 billion Wall Street bailout cash to help the struggling automakers. From the statement, via The New York Times:

President-elect Barack Obama released the following statement this morning on Congress’ failure to reach an agreement on a federal bailout for the “Big Three” auto manufacturers: