“Detroit Three” receive 10bn bailout

The US Congress has agreed in principle to a $15bn (10bn) bailout loan to help rescue General Motors and Chrysler. The US House of Representatives will vote on the bill later today.

The US Congress has agreed in principle to a $15bn (£10bn) bailout loan to help rescue General Motors and Chrysler. The US House of Representatives will vote on the bill later today.

It has also made an additional $9bn (£6bn) could be made available for Ford but the company has opted not to take a loan at this stage.

The bill is due to be sent to the US Senate for approval tonight (December 10) by the House, and funds could be made available as early as Saturday (December 13). President George W Bush has already approved the loan.

The bailout is designed to allow GM and Chrysler to avoid bankruptcy proceedings, while they initiate cost-saving measures. The “Detroit Three” are already planning to cut marketing budgets to help achieve this aim (MW, December 10).

Chrysler chief executive Bob Nardelli has asked for a $7bn (£4.8bn) bridging loan by December 31 to help the carmaker survive until market conditions improve.

Meanwhile, GM has promised that by 2012 it will have fewer brands and nameplates, dealers and employees, and much less debt on its balance sheet, under a restructuring plan. Ford has announced that it does not expect to make money until at least 2011.

As part of the plans, Ford chief executive Alan Mulally vowed to work for an annual salary of $1 (69p), instead of $2m ($1.4m), if the carmaker accepts the federal aid.

Latest from Marketing Week

NOT REGISTERED? IT'S FREE, QUICK AND EASY!

Access Marketing Week’s wealth of insight, analysis and opinion that will help you do your job better.

Register and receive the best content from the only UK title 100% dedicated to serving marketers' needs.

We’ll ask you just a few questions about what you do and where you work. The more we know about our visitors, the better and more relevant content we can provide for them. And, yes, knowing our audience better helps us find commercial partners too. Don't worry, we won't share your information with other parties, unless you give us permission to do so.

Register now

THE BEST CONTENT

Our award winning editorial team (PPA Digital Brand of the Year) ask the big questions about the biggest issues on everything from strategy through to execution to help you navigate the fast moving modern marketing landscape.

THE BIGGEST ISSUES

From the opportunities and challenges of emerging technology to the need for greater effectiveness, from the challenge of measurement to building a marketing team fit for the future, we are your guide.

PERSONAL AND PROFESSIONAL DEVELOPMENT

Information, inspiration and advice from the marketing world and beyond that will help you develop as a marketer and as a leader.

Having problems?

Contact us on +44 (0)20 7292 3711 or email subscriptions@marketingweek.com

If you are looking for our Jobs site, please click here