Detroit finally got a break at the end of a depressing week when president Bush – no doubt mindful of not leaving an automaker meltdown as part of his legacy – finally announced the administration would provide US$13.4bn in short-term loans to GM and Chrysler.
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The money will come from the US$700bn Trouble Asset Relief Programme (TARP), originally intended to provide financial institutions with emergency liquidity.
The two carmakers will get $13.4bn in short-term financing to cover immediate liquidity concerns, with another $4bn to be provided later.
The announcement came a day after the White House, for the first time, had used the b-word, and I don’t mean ‘bailout’. Toyota profit predictions are looking increasingly worse and Honda is all but threatening to exit its native Japan if the government doesn’t rein in the yen against the dollar.
So can we scrape up any other good news reported this week?
Our Man in Brazil had one such story just today: contrary to a Japanese report, the new small car plant down there scheduled for a 2010 opening is still on track, according to Toyota.
Emerging markets still provided some comfort. We learned this week that though Canadian parts companies are expecting the lowest profits in almost a decade, Magna, at least, has some new plans for expansion in Russia.
Transmission technology specialist Antonov is making some inroads in China. And even beleaguered
General Motors has opened a new JV plant to build the Chevy Cruze from next quarter.
Debate continued over whether automakers worldwide should be bailed out or allowed to sink in the shark-filled waters of the free market economy.
So it was time to release our very own Big Dog from the pound to weigh into the debate with inevitable results as our well-informed readers reached for their keyboards.
At least for us, and hopefuly for many of you, a Christmas holiday break from all this Merry Mayhem is coming.
In the meantime, have a nice weekend.
Graeme Roberts
Deputy Editor
just-auto.com
