Auto Makers Seek Billions More in US Aid and Loans

Top executives of the three U.S. automakers lobbied House Speaker Nancy Pelosi on Thursday for up to $25 billion in additional aid and access to the Federal Reserve's borrowing window, industry sources said.

Auto assembly line

Separately, the Bush administration said automakers could soon begin applying for money under an existing $25 billion package of low-interest loans to help them meet fuel-efficiency requirements.

The White House also left the door open for extra aid, saying it would listen to other ideas as the Democratic-led Congress weighs further assistance.

The chief executives, Richard Wagoner of General Motors , Alan Mullally of Ford Motor and Robert Nardelli of Chrysler, attended a late afternoon meeting with Pelosi at her office.

After the session with the California Democrat, the executives planned to talk with Senate Majority Leader Harry Reid, a Nevada Democrat.

"We must work together to ensure the viability of the U.S. auto industry," Pelosi said in welcoming the CEOs and Ron Gettelfinger, president of the United Auto Workers, to the meeting.

Another priority, she said, was to help "transform blue-collar jobs to green collar jobs." The meeting was mainly a listening session for Pelosi to get the views of the auto industry, which is facing an unprecedented financial crisis due in large part recently to the global credit crunch that has choked off borrowing by consumers for auto purchases.

In a statement, GM said the session was constructive and that it would work closely with Democratic leaders to ensure "immediate" funding to keep the industry viable.

Lawmakers had little to say after the meeting but Rep.

John Dingell, the Michigan Democrat who has long been sympathetic to auto interests, predicted the result would be "a good one from the standpoint of the auto industry." He did not elaborate.

Automakers are seeking access to the Fed's discount window as well as a second loan package up to $25 billion, according to industry sources familiar with the companies' thinking.

The Big Three stepped up pleas for help after manufacturing data showed U.S. auto sales dropping by a third in October.

GM and Ford are expected to report dismal earnings Friday.

GM is burning through cash and warned on Wednesday the industry's prospects are dwindling fast due to a "near collapse" in demand for cars.

The Bush administration has never favored a straight bailout and rebuffed GM last week on a proposal for capital to help it facilitate a possible merger with Chrysler, bought last year by Cerberus Capital Management.

But White House spokesman Tony Fratto said the administration would keep an open mind.

"If Congress intends to provide funding for purposes other than the advanced technology loans, we would need to hear their ideas," he said in an email.

"We'll listen if they have ideas on how they would intend to accelerate the availability of funds they have already appropriated -- as long as those funds continue to go only to viable firms." The administration completed a regulatory review late Wednesday of the technology loan program approved by Congress in September.

That $25 billion comes with strict conditions and requirements that industry officials believe will constrain the timely flow of cash at a moment when they cannot wait.

American automakers hope President-elect Barack Obama will be more open to playing a dramatic role.

Obama said on the campaign trail that the industry must remain competitive and plans to meet with executives and union members at some point to discuss their problems.

Congressional Democrats are considering steps to ease requirements of the existing loan program or approve a second aid package that would have few, if any strings attached.

That approach could be part of any broad economic stimulus plan approved during a short legislative session this month.

The head of the Senate Banking Committee, which oversees the Treasury Department's $700 billion financial markets bailout program, said the Bush administration has authority to offer more help to automakers.

Sen. Christopher Dodd, a Connecticut Democrat, said some administration officials may think otherwise, but, "I've taken the position that I think we did extend them that authority." The biggest publicly-traded U.S. car dealership group, AutoNation Inc, said urgent help is crucial.

"It would be a travesty to have trillions to save Wall Street in order to save Main Street and then as collateral damage, you let the American automobile industry be catastrophically affected," said AutoNation chief executive Mike Jackson.

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