Big 3 Auto Recovery Plans

December 2, 2008 12:00:00 AM PST
The big three automakers are laying out their economic recovery plans to congress Tuesday.This time, the CEOs are making travel plans that do not include corporate jets. And Ford's CEO is vowing to cut his salary to a dollar if he has to. An encouraging sign as the Dow Jones Industrial Average opened up Tuesday morning. This after news of the U.S. recession sent the Dow down nearly 680 points on Monday. Where the financial markets head from here is undoubtedly tied to the fortunes of the big three auto makers who return to Capitol Hill looking for $25 billion dollars in bridge loans.

"We have to figure this out. Not sustainable. Not happy about this. Not going to write a blank check," said Senator Christopher Dodd (D) Connecticut. The Senate Banking Committee Chairman not only expects answers from the CEOs of GM, Chrysler, and Ford, he expects specifics.

Ford was the first to unveil their new and improved business plan. It includes accelerating plans for electric cars, as well as Ford's CEO agreeing to work for one dollar a year.

GM's plan is expected to contain the most significant restructuring and downsizing, including the possible elimination of some well-known brands, while Chrysler is expected to propose cutting 25-percent of their workforce.

There is a lot of anxiety in Detroit this week, where federal aid is seen as critical to the industry's very survival. "The big 3 are putting a lot of programs on the back burner. If the cash stopped flowing we can't pay our suppliers," said Tom Barr with TK Bold Engineering.

Hearings are scheduled to begin Thursday and the CEOs are making travel plans that do not include corporate jets this time.



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