Detroit asks for $34 billion assistance

This week, top executives from Ford, General Motors and Chrysler approached US Congress with reports outlining the urgent need for assistance to the motor industry.

In total, the 'Big 3' requested assistance totalling $34 billion, with as much as half of that required in the next two months to prevent bankruptcy.

Each of the car makers presented detailed reports, as well as proposals as to how they intend to use the money, while the government was urged to consider the effect on the US economy if any of the Big 3 goes to the wall.

General Motors this month grounded all of its private jets, while telling the government that it needs $4 billion in loans this month alone, potentially another $4 billion in January and possibly $2 billion the following month, depending on the economy.

GM also proposed the setting up of a $6 billion credit facility that can be accessed if car sales slump even further.

In return for the above, GM has promised restructuring savings totalling $5 billion per year, with several of its brands, including Saab and Saturn, under review. Hummer is already up for sale, with no takers.

It looks like Chrysler is in even more dire circumstances, stating that it needs $7 billion in aid before the end of the year or it will not be capable of maintaining normal operation.

Ford seems to be in a better position than the other two, not requesting immediate financial assistance, but asking the government to set up a $9 billion credit fund just in case it is needed next year.

Ford also promises to cut back expenses while producing more fuel efficient cars. It will simplify its brand structure, with Volvo now likely to be sold, following quickly on from sales of Jaguar, Land Rover and Aston Martin.

Shane O' Donoghue