Tuesday, March 31, 2009 President Obama Steps in to Help the U.S. Auto Industry
 Many things are happening (fast!) in the American automotive world in order to save GM and Chrysler from failing. First of all, GM CEO Rick Wagoner was asked to step down as he is being replaced by another board member, Fritz Henderson. Then, U.S. President Barack Obama made a special announcement giving GM 60 days to restructure itself and present a more aggressive plan than the one announced earlier on February 19. Immediately, Henderson responded that a controlled bankruptcy could be one of those plans. Obama’s government also gave Chrysler 30 days to finalize its agreement with Italian automaker Fiat. The agreement was announced as being reached but later on Monday, an official statement by Chrysler explained that just the “framework” to the agreement had been completed.
On the other hand, Obama’s plan also includes a protection of consumer warranties to people who would consider buying a car from GM or Chrysler but do not do it because they fear a bankruptcy will void the vehicle’s warranty. It will also support suppliers and mostly, it will unlock the flow of credit for consumers and dealers. In Canada, Tony Clement, Minister of the Industry, guaranteed a total of $4 billion, $3 billion to GM and $1 billion to Chrysler, as long as both come to a better agreement with their workers and their union. (ED)
|
