Hard to believe, but taxpayers get what’s needed in auto relief package

December 19th, 2008 at 10:03am Georgette Braun

Hard to believe, but it seems like the taxpayers will get what’s needed in the White House’s $17.4 billion in financial relief for the Big Three automakers:

1. Loans will be called in by March 31 if carmakers aren’t financially viable. Most of the relief will come via short-term loans. And the car makers have only until March 31 to become financially viable. If they don’t, the loans will be called in and all funds must be returned, according to CBS News.

2. Taxpayers are the first in line to collect. The deal also requires the automakers to give the government loans priority over other creditors.

3. There will be limits on executive pay and elimination of perks like corporate jets.

4. Autoworkers will also have to make concessions. The government set targets to allow the Big Three to become competitive with foreign competitors by the end of 2009 as far as wages and worker rules.

Dare we say that this restructuring could be the beginning of a competitive U.S. car industry?

Entry Filed under: auto industry, economy