More state aid seems likely for struggling US automakers in return for new restructuring conditions.


US senator Carl Levin, a Democrat from autos-dependent Michigan, told Reuters the Obama autos task force was likely to recomment more aid and that “it is clear” any assistance would be tied to new conditions on restructuring.


The task force has a 31 March deadline to determine whether General Motors and Chrysler can be competitive and deserving of up to US$22bn in additional bailout funds. The two were granted an initial $17.4 billion in taxpayer assistance in December.


Levin told the news agency he had no specifics on any aid plan, but optimism for helping GM and Chrysler rose last week when the task force approved $5bn in aid for stressed industry suppliers.


It remains unclear, however, how the task force overseen by the White House and Treasury Department would tailor a new bailout package.


Other lawmakers previously have said they were told by task force leaders that any plan would include separate recommendations for GM and Chrysler.


GM has asked for more than $16 billion in aid, while Chrysler is seeking $5 billion.


The rescue extended by the Bush administration required specific concessions on wages and retiree health care costs by the UAW, and debt reduction through GM bondholders.


While the companies have made progress on UAW givebacks, final agreements have not been struck and there has been no deal at GM with bondholders on a proposal to swap a sizable portion of the $27bn in debt they hold for equity.