Obama wants 'leaner, meaner' GM, Chrysler
- Source: Shanghai Daily
- [09:26 May 25 2009]
- Comments
US President Barack Obama says General Motors Corp and Chrysler LLC must emerge from their restructuring as "leaner, meaner" firms and that a substantial market awaits them if they make the right decisions.
Obama said in an interview broadcast on Saturday on the cable television station C-SPAN that the beleaguered auto makers should aim to have product lines that appeal to consumers - and that means fuel-efficient and high-performance vehicles that Americans hunger for.
He defended government intervention in the industry, saying the administration could not let either company simply dissolve.
"Our auto industry is the foundation for economies all across the Midwest," Obama said, "and ultimately, for the country as a whole. And had we allowed GM or Chrysler simply to liquidate that would have been a huge anti-stimulus on the economy as a whole, and could have dragged us even deeper into recession or even depression."
The US president said he believes GM ultimately "is going to be a strong company and we are going to be pulling out as soon as the economy recovers and they've completed their restructuring."
But several members of Congress appealed directly to the administration on Friday to slow down the restructuring, saying they were worried about shuttered car dealerships, job losses and the big unknown of a GM bankruptcy.
They said that a pending June 1 deadline for a GM bankruptcy created more uncertainty and could lead to additional job losses and dealership closings.
Chrysler filed for bankruptcy protection last month, and plans to sell the vast majority of its assets to a group led by Italy's Fiat Group SpA and form a new company. A sale hearing is set for Wednesday, with the deal likely to close about 30 days later.
Ford Motor Co has so far spared itself from needing a federal bailout after taking steps over the last few years to cut costs, focus on its core brands, and introduce new vehicles.
GM borrowed an additional US$4 billion from the government last Friday on top of US$15.4 billion it previously got. The administration has demanded that the restructuring include cutting labor costs, reducing debt, shedding dealerships and brands, and closing excess plants.