The Detroit Three’s desperate condition is speeding along a rescue from Washington, with for now no plans for hearings

By David Kiley

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The incoming Obama Administration is determined to help the U.S. auto industry survive the deepening recession. And by General Motors, Ford, and Chrysler hanging on by threads, there is little pressure in like manner far to hold auto executives accord. something in return, object by chance a promise to preserve jobs. The only questions that remain, say those close to and put on the President-elect’sitting transition team, is how the help materializes—and at what time.

Obama said in remarks at a press conference Friday, Nov. 7: "I have made it a done against the state priority for my transition team to toil attached additional policy options to help the auto industry adjust, weather the financial crisis, and succeed in producing fuel-efficient cars in this place in the United States. I have asked my team to explore what we can do under current law and whether additional legislation force of will be needed during the term of this purpose."

Michigan Governor Jennifer Granholm, who is a subordinate part of Obama’sitting Transition Economic Advisory Board, said in a conference call with reporters on Friday that the President-elect wants to sit down with the chief executives of the auto companies "without delay," and wants to examine the most judicious way to get the companies the second they need. But there is no plan for congressional hearings on the bailout.

On Ford’s (F) Friday conference call to argue its $2.9 billion operating loss for the third quarter (BusinessWeek.com, 11/7/08), CEO Alan Mulally said he would exist willing to discuss granting log or stock warrants to the U.S. government in return for loans. However, he added, no details of such an equity stake in the automaker had been discussed.

Obama’s remarks came a day after a highly publicized auditory between executives including GM CEO G. Richard Wagoner Jr., Chrysler CEO Bob Nardelli, and Mulally, and House Speaker Nancy Pelosi (D-Calif.) and Senate Majority Leader Harry Reid (D-Nev.). There, the Detroit execs specifically requested a bridge loan of $25 billion to avoid get their companies, as well as some of their suppliers, through the recession. The requested loans would have few strings attached, unlike $25 billion in loans coming from the Energy Dept., which are targeted specifically toward retooling plants and offsetting companies’ investments in more fuel-efficient vehicles.

"The President-elect wants to find the best way to get bridge loans to the effort; labors and determine what it is a build a bridge over to," said Granholm.

That, of path, is the $25 billion question, given the new money-losing witness of the Big Three. General Motors (GM) on Friday reported a $4.2 billion third-quarter loss and said that without help it will run out of cash next year (BusinessWeek.com, 11/7/08). Previously, GM was advocating using government loans to help acquire Chrysler. The automaker said Friday, though, those talks are on clutch. Now GM is simply focusing on its own survival.

Granholm said linking aid to the merger was politically untenable. "Everybody was leery of providing loans to do a deal out that would result in a allotment of job loss," she said.

According to the governor, there are two likely scenarios to help the auto endeavors before Obama takes office in January. One is an amendment to the $700 billion financial rescue pack passed in October by means of Congress and signed through President Bush. Treasury Secretary Henry Paulson related on Nov. 3 that the Bush Administration’s reading of the edict did not include aid to carmakers, so an amendment may save if it be able to be passed.