US Car Industry Bail-Out Fails
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8:20am UK, Friday December 12, 2008
A huge bail-out package for the American car industry has collapsed in the US Senate, putting thousands of jobs in motor manufacturing in the UK at risk.
General Motors is warning of imminent collapse
The $14bn plan failed to get enough support, following Republican demands that the car workers’ union agree to wage cuts.
Two of America’s big three car companies, General Motors and Chrysler, have said they could go under without an immediate cash injection.
“It’s going to be a very, very bad Christmas for a lot of people based on what takes place here tonight,” Senate Majority Leader Harry Reid told his colleagues before the vote. “It’s over with.”
I dread looking at Wall Street. It’s not going to be a pleasant sight.
Senate majority leader Harry Reid on bail-out failure fallout
White House spokesman Tony Fratto said the administration would evaluate its options “in light of the breakdown in Congress.
It said the legislation had “presented the best chance to avoid a disorderly bankruptcy while ensuring taxpayer funds only go to firms whose stakeholders were prepared to make difficult decisions to become viable.”
The demise of the car rescue bill prompted immediate calls from lawmakers in both parties for the Bush administration to tap into the $700bn Wall Street bail-out.
US crude oil prices fell more $2 toward $45 a barrel on news of the bail-out collapse.
Senators negotiated late into the night on a possible compromise that those involved said fell apart over proposed wage concessions by the powerful United Auto Workers union.
admin @ December 12, 2008