Auto Bailout

Zachary Gil
Professor Lewis
December 08, 2008

Big Three Automaker Bailout
The financial bailout of the Big Three automakers Ford, Chrysler and General Motors is a prime example of the recent economic hardship that most consumers have been in touch with. All three automakers are asking for billions of dollars in loans from the federal government to keep their operations going until they can retool and the economy bounces back from its recession. Recent polls taken indicate that the American public is not in favor of granting any loans, at the expense of the taxpayer, because automakers are still misusing company funds. Automakers have acknowledged that their efforts over the last thirty years should have been geared toward keeping themselves competitive with the foreign automakers such as Toyota and Honda. Making reliable and efficient cars should have been the way to go. Instead they chose to go where the money was at the time and banked on popularity of trucks and SUVs. Business started to dwindle a few years ago as gas prices slowly climbed upward but when gas prices made it all the way to four dollars a gallon, consumers looked for new ways to save money and the automakers were left with a lot of trucks and SUVs that were not as popular as they had once been. This leaves Americans wondering if the automakers get the loans, will this be enough or is it just delaying the inevitable?

In the midst of the bank bailout, the big three automakers Ford, Chrysler and General Motors have come forward to ask the federal government for loans to help not only stay afloat but to restructure their industry. Without the loans, automakers say that they will be forced to go into bankruptcy causing hundreds of thousands of job losses and the economy will slip deeper into recession. General Motors and Chrysler would like immediate cash loans to stall possible failure, while Ford is asking for a 9 billion dollar credit line to use just in case they need it...