Major Automakers Band Together And Petition US Lawmakers For Coronavirus-related Aid

Groups representing major automakers and suppliers asked U.S. lawmakers on Friday to consider new tax relief and delay the start of a new trade deal as auto sales decline as a result of the coronavirus pandemic.

The proposals come as major automakers are temporarily closing plants and cutting production. On Friday, BMW AG became the latest to announce a production halt.

The Alliance for Automotive Innovation — representing General Motors Co, Volkswagen AG, BMW, Toyota Motor Corp and others — and the Motor & Equipment Manufacturers Association (MEMA) in a joint letter seen by Reuters backed “key actions” by U.S. lawmakers to help “ensure that sufficient liquidity remains available in the markets.”

The auto groups endorsed proposals supported by the U.S. Chamber of Commerce and others to create “credit facilities to provide loans and loan guarantees to employers with more than 500 employees experiencing loss of revenue due to COVID-19..."
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SanJoseDriver - 3/21/2020 7:26:49 PM

+2 Boost

How did this end last time? Oh, that's right... only Tesla and Ford paid back their loans and we all lost money on GM and Chrysler.

MDarringer - 3/21/2020 7:39:30 PM

0 Boost

You utter moron. Ford was NOT bailed out. Ford saved their own ass last time.

SanJoseDriver - 3/22/2020 2:22:50 AM

+4 Boost

Actually, they were in the same boat as Tesla and took a loan. GM sold assets to the government, for which we all lost a collective $11 billion.

"Although Ford did not receive TARP funds, it did receive government loans. These were critical because banks were not lending during the financial crisis. It requested a $9 billion line-of-credit from the government. In return, it pledged to spend $14 billion on new technologies.

On June 23, 2009, Ford received a $5.9 billion loan from the Energy Department's Advanced Technology Vehicles Manufacturing program. In return, it pledged to accelerate the development of both hybrid and battery-powered vehicles, close dealerships, and sell Volvo. It upgraded factories in Illinois, Kentucky, Michigan, Missouri, and Ohio to produce hybrid vehicles.28?

Ford used the funds to switch its focus to commercial electric vehicles. In 2016, CEO Mark Fields said, "We want to become a top player in electrified solutions. The company wants to lead…we can win such as with our commercial vehicles."

Eighty-one percent of the funds went to create new efficiency technologies for gas-powered vehicles. For example, they helped fund Ford's aluminum bodies in the F-series pickups. The Congressional Research Service estimated the loans saved 33,000 jobs.? Ford will repay this loan by 2022.

Many argue that Ford needed the funds to sustain its cash flow during the recession. Ford says it was in better shape than the other two because it had mortgaged its assets in 2006 to raise $23.6 billion. It used the loans to retool its product lineup to focus on smaller, energy-efficient vehicles. It got the United Automobile Workers to agree it could finance half of a new retiree health care trust with company stock."

MDarringer - 3/22/2020 11:23:24 AM

0 Boost

And those loans had NOTHING to do with bail out.

SanJoseDriver - 3/22/2020 9:05:37 PM

+2 Boost

Then Tesla wouldn't be part of the bailout either.

https://www.thebalance.com/auto-industry-bailout-gm-ford-chrysler-3305670

"The Big Three automakers asked Congress for help similar to the bank bailout. They warned that General Motors Company and Chrysler LLC faced bankruptcy and the loss of 1 million jobs. The Ford Motor Company didn't need the funds since it had already cut costs. But it asked to be included so it wouldn't suffer by competing with companies who already had government subsidies."