GM, Chrysler need to share their plans
Today's the deadline for GM and Chrysler to tell the government how they'll repay taxpayers and become viable again. Janet Babin reports a key to GM's plan is more concessions from its creditors and union workers.
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Steve Chiotakis: Today's the deadline for GM and Chrysler to tell the government how they'll repay taxpayers and become viable again. GM took more than $9 billion in government loans last year. Chrysler got $4 billion. But it looks like the restructuring plans still needs some work. From North Carolina Public Radio, here's Marketplace's Janet Babin.
Janet Babin: Both GM and Chrysler are living on borrowed billions in government aid. Both are asking for even more money. To get it though, they have to show the Treasury Department that they have a plan to cut costs and pay the government back.
To do that, GM needs more concessions from its creditors and union workers. Talks with the United Auto Workers broke down over retiree health benefits. Negotiations reportedly went into the night, but it doesn't look like a deal will come today.
Either way, University of San Francisco professor Jon Fisher doubts GM or Chrysler can become profitable:
Jon Fisher: I think the only way to truly restructure these companies is to protect them in bankruptcy and fundamentally realign cost structures.
As part of the original agreement, the government is expected to release an additional $4 billion in aid today for GM, and $3 billion for Chrysler. Final restructuring plans must be in place by the end of March.
I'm Janet Babin for Marketplace.
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