While most of us are spending a long holiday weekend relaxing or watching a cheesy new Christmas movie because your spouse loves seeing even the worst ones, this is a working weekend in Detroit. At GM , Ford , and Chrysler executives are preparing their "business plans" for Congress to review starting Tuesday.
Strange as it sounds, this is a trickier exercise than you would expect. On one hand Detroit's auto makers want to show law makers they DO have plans that will lead them back to profitability. On the other hand, they don't want to give too many details that might be leaked out and tip their hands before they are ready. It's a fine line they'll have to walk if they're going to secure $25 billion in low interest loans.
As I've said over the last month, I think Congress will ultimately give the Big 3 the money needed to avoid bankruptcies. With the economy already weakened and with the bailout of Citi earlier this week, Congressional leaders will feel compelled to approve money for the Big 3. Even critics of Detroit are sending signals that a bailout will eventually pass.
Still, the CEOs of the Big 3 know they are going to be grilled about their "business plans". The biggest question: how confident can Congress be that $25 Billion is enough money to rescue Detroits auto makers?
There are plenty of people on Capitol Hill, Wall Street, and yes, even of the streets of Detroit who wonder if the Big 3 will go back to Congress in a few months and ask for more money. Heck, estimates on Wall Street have GM alone needing between $22-$40 Billion to make it into 2010. You can bet Senators and Representatives at the hearings will have those analyst reports and will ask GM if $12 Billion will truly be all the money it needs.
More on the Big Three
- In A Crippled Auto Industry, Reasons To Give Thanks
- GM, Ford Shares Skyrocket as Bailout Hopes Brighten
- Chrysler Readies Turnaround Plan for Congress
So Rick Wagoner finds himself once again on the hot seat. Only this time, he will be expected to give even more details. The same goes for Alan Mulally and Bob Nardelli. Act two of the "Big 3 go to Washington" is about to debut. For Detroits sake, the sequel needs to be better than the first production.
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