US Auto Industry Seeks 25 Billion Dollar Bailout

The economy has rocked a lot of major industries in the last few months, but few have been hit quite as hard as the U.S. auto industry. Top executives from Detroit's big three automakers, GM, Ford, and Chrysler, went before Congress recently to plead for a 25 billion dollar bailout loan that is necessary to save the companies, whose sales have plummeted in the last year as consumers are purchasing fewer cars and looking to get more fuel efficient cars from foreign companies when they do buy new vehicles. The executives argued that without the stopgap loan, they would probably fold, which would cause an economic catastrophe as three million of autoworkers would be laid off within the year. Lawmakers on Capitol Hill were not sympathetic, taking the opportunity to vent frustration with the companies. Banking committee chairman Chris Dodd told the executives that their industry was “seeking treatments for wounds that I believe to a large extent were self-inflicted” after years of selling gas guzzling trucks and SUVs and resisting innovations in fuel efficiency. But Dodd added that “at a time like this, when our economic future is so tenuous, we must do all we can to ensure stability.” Senator Mike Enzi, a Republican from Wyoming, chimed in with his own criticism of the industry when he noted that the financial crisis “is not the only reason why the domestic auto industry is in trouble” and argued that “inefficient production” and “costly labor agreements” have caused the US industry to fall behind their foreign competitors. Critics have argued that Detroit's big three could file for chapter 11 bankruptcy protection, as some airlines did in response to the financial meltdown, but Chrysler CEO Robert Nardelli argued that “we just cannot be confident that we will be able to successfully emerge from bankruptcy.” GM CEO Rick Wagoner told congress that it wasn't just lack of innovation that is making the companies fall behind and "what exposes us ...