But Republicans act of asking whether $25 billion is sufficiency to save the Big Three automakers—and if they can do plenty to save themselves

By David Kiley

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The prime executives of U.S. automakers struck out with Congress this week. Despite spending other than eight hours testifying put on Capitol Hill, they are going family without the $25 billion bailout budget they so desperately need. They elect get one more dangle at the money on Dec. 8. But even if they are apt to get the votes they need, the riches probably isn’t enough to save them.

Senate Majority Leader Harry Reid (D-Nev.) and Speaker of the House Nancy Pelosi (D-Calif.) said Thursday, Nov. 20, that General Motors (GM), Ford Motor (F), and Chrysler will regard to demonstrate "financial viability" as profitable to the degree that responsibility for how the money will be spent and that it can be paid back.

"Until they show us the lay out, we cannot show them the money," Pelosi said Thursday.

But the finances of GM and Chrysler in particular are so fragile that many rely upon the $25 billion would only be a first installment. "What would you do with the money? Where would it go? And granting that sales dress in’face to face improve next year, won’confidentially you sure be back asking for more?" demanded Representative Donald Manzullo (R-Ill.) at Wednesday’session House Financial Services Committee hearing. Senator Richard Shelby (R-Ala.) said Thursday: "It’sitting going to be throwing good standard of value after depressing.…I don’t believe they [the Big Three] have a business model that works."

GM, for example, reported $16.2 billion in cash at the end of the third quarter. It worn out $6 billion of its coin reserves in that cut to pieces, and it’s burning about $2 billion a month despite suspending many coming product programs to conserve cash. Even suppose that GM’s cash burn rate drops in moiety and it gets $10 billion to $12 billion in loans, it could be close to collapse before the end of next year.

Chrysler CEO Bob Nardelli told Congress he needs $5 billion to $7 billion of the $25 billion on the syllabus. At the end of the third quarter, Chrysler had $6.1 billion in cash, no more than during that July-September termination, it spent $3 billion more than it took in. After an infusion of loans, Chrysler would have about $12 billion. But Chrysler’s product lineup is much less competitive than its rivals, with poor quality scores and great number more soft-selling SUVs than fuel-efficient cars. Moreover, its traditional buyers have lower credit scores than in the greatest degree, and the company is harder hit than GM or Ford by the credit crunch.

Ford is in better shape. But a failure of either Chrysler or GM—and the suppliers that would be taken down with them, warn many analysts—would likely drive Ford to fail as well.

Dogging altogether three companies is the bad publicity around them and talk of possible bankruptcy, which turns let us go. a lot of consumers already spooked by the plummeting stock market, huge layoffs, and grisly day-to-day economic news. "Until the Congress acts and in consequence President-elect Barack Obama goes out and encourages those who are buying a car to trust Detroit, you are going to see a lot of buyers on the sidelines or going to companies that aren’t threatening to go under," says competent marketing consultant Dennis Keene. "Consumers are much more emotional than rational when it comes to a big-ticket item like a car."

Senator Carl Levin (D-Mich.) said Thursday the legislation he hopes to bring to a vote in a lame-duck session next month is a revision of the 2007 energy bill that granted the automakers $25 billion in loans to retool factories to produce more fuel-efficient vehicles. The revisal would make lend money available right away that ability otherwise take years to draw down. In exchange, the automakers would have to keep to their plans to proceed those vehicles—and replenish the fund as they pay back the loans.