UAW Pres Warns of Big 3 Chapter 7 Liquidation
United Auto Workers President Ron Gettelfinger said it is critical the Big 3 receive a financial aid package from Congress to avoid one or more of Detroit's auto makers from sliding into a Chapter 7 bankruptcy.
Chapter 7 bankruptcy would mean a liquidation, or going out of business for an auto maker.
"We are in a crisis," Gettelfinger said. "We need a package approved by this lame duck session of Congress. If we don't get it, I'm not sure some of these auto makers will make it to mid-January when Barack Obama becomes president."
Last week, General Motors announced it burned through $6.9 Billion in cash during the third quarter and is just a few billion above the bare minimum needed to run the company day-to-day.
Gettelfinger and the CEOs of GM, Ford and Chrysler will be questioned on Capitol Hill Tuesday and Wednesday. The Senate may vote on a bailout package Wednesday. Republicans have indicated they may not support lending Detroit's auto makers $25 Billion.
Gettelfinger said the auto makers would slide from a Chapter 11 to a Chapter 7 bankruptcy because potential buyers will not but from a company that may or may not be around in years to come. That would mean already weak sales could plunge even further and reduce revenue for the Big 3 even more.