US Auto-Parts Suppliers Seeking Aid From Government.
The Wall Street Journal (2/5/2009, B2, Bennett, Mitchell) reports, "Beleaguered auto-parts suppliers are following the lead of Detroit's Big Three in seeking aid from the federal government." The Motor & Equipment Manufacturers Association, "an industry group representing 400 parts makers," asked the Treasury Department "for $25.5 billion in aid and guarantees," saying, "Without immediate assistance to suppliers, the country will face massive job losses and the eventual breakdown of the entire automotive sector in the United States." But, the New York Times (2/5, B9) notes, "no formal request for financial help has been made and no dollar amount has been requested, according to a joint statement by the Motor Equipment and Manufacturing Association and the Original Equipment Suppliers Association."
Meanwhile, Bloomberg News (2/5, Ortolani, Green) reports, "U.S. auto-parts suppliers...asked for as much as $10.5 billion in aid from the Treasury Department to prevent an industry collapse. Three scenarios for federal action include a 'quick-pay' program to speed payments to partsmakers through General Motors Corp. (GM) and Chrysler LLC, the Motor & Equipment Manufacturers Association trade group said in a presentation this week." Under "one scenario for aid," GM and Chrysler would "have access to a $7 billion revolving line of credit created from the Troubled Asset Relief Program to pay suppliers faster than usual." In a second scenario, "the government [would] guarantee promised payments from automakers should one of them file for bankruptcy or be unable to pay." And in a third scenario, "$8 billion of TARP funds would be made available to suppliers in need of capital."
Posts
