<TABLE cellSpacing=0 cellPadding=0 width=452 border=0><TBODY><TR vAlign=top><TD></TD></TR><TR><TD vAlign=top width=452 colSpan=2>December 6, 2008, 12.49 pm (Singapore time)
</TD></TR><TR><TD vAlign=top width=452 colSpan=2>Latest update
</TD></TR><TR><TD vAlign=top width=452 colSpan=2>Lawmakers, White House agree on auto aid plan
* Package would be US$15 billion to US$17 billion, aides
* Energy Department program said source of funds
* Details still to be worked out
* Congressional leaders aim for vote next week
* Analyst expects more aid will be sought
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WASHINGTON - Congressional Democrats and the White House have reached agreement on emergency aid for US automakers of between US$15 billion and US$17 billion, two senior congressional aides said on Friday.
<TABLE class=picBoxL cellSpacing=2 width=100 align=left><TBODY><TR><TD>
</TD></TR><TR class=caption><TD>The emergency aid for US automakers of between US$15 billion and US$17 billionis far less than the US$34 billion in loans requested this week by General Motors, Ford Motor, and Chrysler, but it would keep them going into next year</TD></TR></TBODY></TABLE>The outline of the package was reached after auto executives pleaded with lawmakers for help and US data showed employers axed more than 533,000 jobs in November, the highest monthly job-loss in 34 years.
'Congressional Democrats and the White House have reached an agreement,' a senior congressional aide said.
Another source said negotiators had 'agreed in principle to moving ahead but details have to be worked out'.
More talks were expected on Saturday with Congressional votes on a bill next week.
The amount is far less than the US$34 billion in loans requested this week by General Motors, Ford Motor, and Chrysler, but it would keep them going into next year.
Daniel Weiss, a senior fellow with the Centre for American Progress, said he expected Democratic lawmakers to seek more money for automakers after a new Congress meets and Barack Obama is sworn in as president on Jan 20.
'A short-term loan agreement is like putting a Band-Aid on a haemorrhage and they will still have to try and save the patient in January,' said Mr Weiss.
The automakers say they need help to survive a sharp downturn in sales fuelled first by the credit crisis and now recession.
At hearings this week, many lawmakers were sceptical of their viability, arguing they had failed in the past to cut enough costs, to ween themselves from making petrol guzzlers and to produce innovative cars consumers want to buy.
Funding tussle
Earlier on Friday, US House of Representatives Speaker Nancy Pelosi had dropped her insistence that aid come from the US$700 billion financial services bailout fund that the Bush administration had refused to use for automakers.
A source with knowledge of the discussions said the money would come from an existing US$25-billion advanced energy technology loan fund to help auto companies meet new fuel-efficiency standards - an idea the White House has promoted.
In a statement Ms Pelosi had suggested she could agree with that source of funds under certain conditions.
'We will not permit any funds to be borrowed from the advanced technology program unless there is a guarantee that those funds will be replenished in a matter of weeks so as not to delay that crucial initiative,' she said.
Compromising on the source of funds would likely build bipartisan support in Congress for a bill that could be signed into law by President George W Bush, a Republican.
White House spokesman Tony Fratto declined to comment on any discussions related to the automakers bailout.
Both Ms Pelosi and Senate Majority Leader Harry Reid said in statements they expected to have votes next week on an automaker assistance plan.
Disaster feared
Congress and the White House are anxious to prevent the threatened near-term collapse of one or more of the Detroit Three - which directly employ 250,000 people.
'In the midst of the worst economic situation since the Great Depression it would be an unmitigated disaster,' said Representative Barney Frank, chairman of the House Financial Services Committee, at a hearing with the chief executives from the automakers.
GM and Chrysler have asked for immediate loans to forestall possible failure, while Ford is asking for a US$9 billion credit line that would be tapped later if necessary. GM wants US$12 billion in loans, with US$4 billion of that immediately, as well as a US$6 billion credit line. Chrysler wants US$7 billion.
Chrysler CEO Bob Nardelli told Mr Frank's committee on Friday that the company needs US$4 billion to run operations through March. Over the same time frame, GM CEO Rick Wagoner said his company needs US$10 billion to keep going.
Ford CEO Alan Mulally said again that his company does not immediately need to use federal funds.
GM and Chrysler could not immediately be reached for reaction to the aid developments.
'The US auto industry is a critical part of our economy and we are encouraged by Speaker Ms Pelosi's statement that Congress is expected to act next week,' Ford said in a statement.
Meanwhile, GM, Ford and Chrysler appealed to the Canadian and Ontario governments for billions of dollars in emergency loans against a backdrop of fresh layoffs at Ontario assembly plants. 'We're fighting for our survival,' said Reid Bigland, president and chief executive of Chrysler Canada. -- REUTERS
</TD></TR></TBODY></TABLE>
</TD></TR><TR><TD vAlign=top width=452 colSpan=2>Latest update
</TD></TR><TR><TD vAlign=top width=452 colSpan=2>Lawmakers, White House agree on auto aid plan
* Package would be US$15 billion to US$17 billion, aides
* Energy Department program said source of funds
* Details still to be worked out
* Congressional leaders aim for vote next week
* Analyst expects more aid will be sought
<TABLE class=storyLinks cellSpacing=4 cellPadding=1 width=136 align=right border=0><TBODY><TR class=font10><TD align=right width=20>
</TD><TD>Email this article</TD></TR><TR class=font10><TD align=right width=20>
</TD><TD>Print article </TD></TR><TR class=font10><TD align=right width=20>
</TD><TD>Feedback</TD></TR></TBODY></TABLE>WASHINGTON - Congressional Democrats and the White House have reached agreement on emergency aid for US automakers of between US$15 billion and US$17 billion, two senior congressional aides said on Friday.
<TABLE class=picBoxL cellSpacing=2 width=100 align=left><TBODY><TR><TD>
</TD></TR><TR class=caption><TD>The emergency aid for US automakers of between US$15 billion and US$17 billionis far less than the US$34 billion in loans requested this week by General Motors, Ford Motor, and Chrysler, but it would keep them going into next year</TD></TR></TBODY></TABLE>The outline of the package was reached after auto executives pleaded with lawmakers for help and US data showed employers axed more than 533,000 jobs in November, the highest monthly job-loss in 34 years.'Congressional Democrats and the White House have reached an agreement,' a senior congressional aide said.
Another source said negotiators had 'agreed in principle to moving ahead but details have to be worked out'.
More talks were expected on Saturday with Congressional votes on a bill next week.
The amount is far less than the US$34 billion in loans requested this week by General Motors, Ford Motor, and Chrysler, but it would keep them going into next year.
Daniel Weiss, a senior fellow with the Centre for American Progress, said he expected Democratic lawmakers to seek more money for automakers after a new Congress meets and Barack Obama is sworn in as president on Jan 20.
'A short-term loan agreement is like putting a Band-Aid on a haemorrhage and they will still have to try and save the patient in January,' said Mr Weiss.
The automakers say they need help to survive a sharp downturn in sales fuelled first by the credit crisis and now recession.
At hearings this week, many lawmakers were sceptical of their viability, arguing they had failed in the past to cut enough costs, to ween themselves from making petrol guzzlers and to produce innovative cars consumers want to buy.
Funding tussle
Earlier on Friday, US House of Representatives Speaker Nancy Pelosi had dropped her insistence that aid come from the US$700 billion financial services bailout fund that the Bush administration had refused to use for automakers.
A source with knowledge of the discussions said the money would come from an existing US$25-billion advanced energy technology loan fund to help auto companies meet new fuel-efficiency standards - an idea the White House has promoted.
In a statement Ms Pelosi had suggested she could agree with that source of funds under certain conditions.
'We will not permit any funds to be borrowed from the advanced technology program unless there is a guarantee that those funds will be replenished in a matter of weeks so as not to delay that crucial initiative,' she said.
Compromising on the source of funds would likely build bipartisan support in Congress for a bill that could be signed into law by President George W Bush, a Republican.
White House spokesman Tony Fratto declined to comment on any discussions related to the automakers bailout.
Both Ms Pelosi and Senate Majority Leader Harry Reid said in statements they expected to have votes next week on an automaker assistance plan.
Disaster feared
Congress and the White House are anxious to prevent the threatened near-term collapse of one or more of the Detroit Three - which directly employ 250,000 people.
'In the midst of the worst economic situation since the Great Depression it would be an unmitigated disaster,' said Representative Barney Frank, chairman of the House Financial Services Committee, at a hearing with the chief executives from the automakers.
GM and Chrysler have asked for immediate loans to forestall possible failure, while Ford is asking for a US$9 billion credit line that would be tapped later if necessary. GM wants US$12 billion in loans, with US$4 billion of that immediately, as well as a US$6 billion credit line. Chrysler wants US$7 billion.
Chrysler CEO Bob Nardelli told Mr Frank's committee on Friday that the company needs US$4 billion to run operations through March. Over the same time frame, GM CEO Rick Wagoner said his company needs US$10 billion to keep going.
Ford CEO Alan Mulally said again that his company does not immediately need to use federal funds.
GM and Chrysler could not immediately be reached for reaction to the aid developments.
'The US auto industry is a critical part of our economy and we are encouraged by Speaker Ms Pelosi's statement that Congress is expected to act next week,' Ford said in a statement.
Meanwhile, GM, Ford and Chrysler appealed to the Canadian and Ontario governments for billions of dollars in emergency loans against a backdrop of fresh layoffs at Ontario assembly plants. 'We're fighting for our survival,' said Reid Bigland, president and chief executive of Chrysler Canada. -- REUTERS
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