If you watched the Big 3 CEOs on Capitol Hill Thursday you probably came away with two impressions. First, the contrite tone of the CEOs makes it clear the auto makers know they have to try a more humbled approach.
Second, despite all the skepticism that the Big 3 can not fix their companies, there is a realization in Washington something must be done to keep GM and Chrysler from filing for bankruptcy by the end of the month. So, for the CEOs this is a good news/bad news situation.
The good news is they will get some money from Washington. They will not be allowed to slide into bankruptcy.
The bad news is this lifeline from Congress will not be everything the Big 3 wants and likely will include even more conditions than the CEOs really want. If they don't like that, too bad. At this point they have no choice but to jump through whatever hoops Washington sets up.
Will there be some loan guarantee board? Yes. Will there be deadlines and financial benchmarks every few months the auto companies have to meet to get the next round of money? Probably. Will the Big 3 be forced into becoming the Big 2 with GM acquiring Chrysler as some Senators suggested Thursday? Perhaps.
- GM, Chrysler Are Open to Merger If Part of Bailout
The bottom line is the Big 3 have more to do before they get the bailout and this looks like a messy situation that will not be completely worked out by the end of this year. This is just the beginning of a forced marriage between Washington and Detroit that will drag on for months, if not years.
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