Automakers want $25b in US aid

Money to cover retiree healthcare

Ford chief Allan Mulally (left) arrives at the Capitol to meet with congressional leaders yesterday. (Associated Press)

WASHINGTON - Detroit's automakers appealed to congressional leaders yesterday for $25 billion more in federal loans, low-interest emergency borrowing, and a share of the Wall Street bailout to help rescue an ailing industry battered by the economic crisis.

The talks with House Speaker Nancy Pelosi, Democrat from California, and Senate Majority Leader Harry Reid, a Nevada Democrat, came as General Motors Corp. and Ford Motor Co. were poised to disclose billions more in losses and further job cuts today, and as GM's president for North America said the next 100 days would be critical for his company and the industry.

GM, Ford, and Chrysler LLC pledged to work with the leaders "to ensure immediate and necessary funding to keep the auto industry viable and its transformation on track during this critical time," according to GM.

In an interview with The Wall Street Journal before the meeting, Pelosi said Democratic leaders are considering several options to help the industry, including tax credits to encourage the purchase of new vehicles and additional financing beyond the $25 billion in loans approved by Congress in late September to help the companies retool plants to build more fuel-efficient cars.

"We have an industry - forget the companies - an industry in our country that is at risk," Pelosi told the newspaper. "Whatever we may think about the poor choices made by the companies, the industry is important to our country. The fate of the workers, their jobs, their health, their pensions, are important to them and to our economy."

GM said the additional federal support would allow "a competitive" auto industry "to contribute to our nation's economic revival." The executives, who were joined by United Auto Workers president Ron Gettelfinger, declined to comment to reporters between the private meetings.

They sought an additional $25 billion in federal loans for future healthcare payments for retirees.

They also want lawmakers' help in winning access to the $700 billion financial bailout being run by the Treasury Department and to low-rate emergency borrowing from the Federal Reserve's discount window, used in normal times by banks.

The loans would help the companies make required payments to healthcare trust funds that were created as part of a 2007 labor deal.

Last month, Congress approved $25 billion in low-interest loans for domestic automakers and suppliers to retool plants to build fuel-efficient vehicles. But congressional allies of the industry have said the money will not be available quickly enough to help.

Representative John Dingell, a Michigan Democrat, a longtime advocate for the industry, said the meeting was productive but did not address the specifics of the industry's request.

US auto sales declined to their lowest level in more than 17 years last month, leading some executives to predict dire consequences if the economy did not improve. The companies want Pelosi to include the new money in an economic aid plan if the House returns for a postelection session.

Alan Reuther, UAW legislative director, said the executives - Chrysler's Bob Nardelli, Ford's Alan Mulally, and GM's Rick Wagoner - and Gettelfinger came to Washington to make the case for more federal assistance "to help the companies through this severe economic credit crisis."

GM has talked to Cerberus Capital Management LP, the majority owner of Chrysler LLC, about acquiring Chrysler.