Although General Motors and Chrysler have yet to complete their revised viability plans, the federal government is preparing another round of aid for the ailing automakers. As with previous Detroit aid, the latest short-term funds will be carved out of the $700 billion Troubled Asset Relief Program.
According to a report from the Treasury Department obtained by The Detroit News, General Motors is slated to receive as much as $5 billion in short-term aid, with Chrysler set to get $500 million. Both automakers would be eligible for additional funds if their viability plans are approved by the Obama administration in the coming weeks.
The report also outlined a preliminary plan for the U.S. government to back GM and Chrysler warranties – should either automaker be forced into bankruptcy. The Obama administration will initially fund the program with $1.25 billion, but that figure is subject to change.
