Members of President Obama’s auto task force visited General Motors and Chrysler on Monday to see firsthand the companies whose fates rest in their hands.þþTop advisers on the task force, like Steven Rattner and Ron Bloom, toured G.M. and Chrysler plants in Warren, Mich., including a Chrysler factory that builds Dodge Ram pickups. They also drove prototypes of G.M.’s new extended-range electric car, the Chevrolet Volt.þþThe auto executives and workers can only hope they made a favorable impression, as the task force enters a critical phase for deciding how, and whether, to rescue the two automakers, The New York Times’s Bill Vlasic and Nick Bunkley reported.þþThe task force members told G.M. and Chrysler executives and leaders of the United Automobile Workers union that Mr. Obama was aware of the urgency of Detroit’s problems and was committed to supporting the industry, said an administration official who spoke on condition of anonymity because the discussions were private.þþHowever, the official also said that the president saw the need for a fundamental reorganization of G.M. and Chrysler, without specifying how that would be accomplished.þþAt issue is whether the government extends up to $21.6 billion in additional loans to G.M. and Chrysler, or arranges federally financed bankruptcies for the companies.þþThe government has set a March 31 deadline to decide whether to provide more aid to the automakers.þþBy then, G.M. will have exhausted the $13.4 billion in federal loans it has already received. Chrysler is also on the brink of using all of its $4 billion federal loan.þþ“They don’t have the luxury of time because these companies are deteriorating before our eyes,” John A. Casesa, whose consulting business, the Casesa Shapiro Group, advises the auto industry, told The Times. The task force’s visit drew intense interest in the Detroit area.þþHelicopters from local televisions stations hovered over the G.M. Technical Center to catch a glimpse of Mr. Rattner and Mr. Bloom, two former investment bankers, as they drove the Chevy Volt around the grounds of the sprawling complex.þþA front-page headline in The Detroit Free Press conveyed the desperation of the city. “Hear Us Out,” it said. “We’re in Crisis.”þþThe companies provided few details of the meetings. A Chrysler spokeswoman, Lori McTavish, told The Times that the task force had met with the company’s chairman, Robert L. Nardelli, and reviewed several products it is planning.þþ“We were pleased to host the task force so they could experience firsthand the new products and technologies that are integral parts of G.M.’s near- and long-term competitiveness,” G.M. said in a statement.þþThe group — which included two officials from the National Economic Council, Diana Farrell and Brian Deese — also met with Ron Gettelfinger, president of the U.A.W.þþMr. Obama formed the task force last month to assess broad reorganization plans submitted by G.M. and Chrysler as a condition of their federal loans.þþThe panel, led by Timothy F. Geithner, the Treasury secretary, and Lawrence H. Summers, director of the National Economic Council, is weighing whether to provide more loans, or require the companies to reorganize in bankruptcy.þþThe task force has held a number of meetings not only with G.M. and Chrysler executives, but also with dealers, suppliers, bondholders and a variety of industry specialists.þþOne auto analyst who met with the group last week said its members were studying long-term industry trends as well as specific problems facing G.M. and Chrysler.þþ“You can’t learn everything in six weeks, but they’re sure giving it a shot,” the analyst, Sean McAlinden, chief economist with the Center for Automotive Research, told The Times. “This will be an informed decision.”þþThe leader of the National Auto Dealers Association, John McEleney, met with the task force for 90 minutes last Friday.þþ“We didn’t spend much time on the bankruptcy discussion at all,” Mr. McEleney, who owns two dealerships in Iowa, that sell multiple brands, including G.M., told The Times. “And hopefully that won’t be something we’ll have to talk about.”þþThe government has ordered G.M. and Chrysler to reduce their unsecured debt by two-thirds, and to convince the union to take stock to finance at least 50 percent of a new health care trust for retired workers.þþThose talks are continuing, The Times said, citing people with knowledge of the discussions.þþThe third Detroit automaker, the Ford Motor Company, has not asked for government loans. However, Ford reached an agreement with U.A.W. on financing for its health care trust, and last week made offers to bondholders to substantially reduce its debt.þþOn Monday, the U.A.W. announced that its members at Ford had approved the agreement that allows the company to finance the trust with a combination of cash and stock.þþ
Source: NY Times
