US car makers get bail-out

19 December 2008

Chrysler and GM get US loans
$17bn loan package agreed
3-month deadline to get solvent

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The US government will provide its troubled car industry with up to $17.4bn ($11bn) in loans.

President George Bush said allowing the industry to fail would not be a 'responsible course of action'.

The government has set a deadline of March 31 for the firms to become solvent.

Chrysler and General Motors (GM) are expected to take up the loan offer straight away.

However, Ford has previously stated that it wanted to 'pull itself up by its own bootstraps', so it remains unclear whether it will accept the bail-out.

While announcing details of the loans, President Bush warned that the US car industry needs to make reforms, and the restructuring would need 'meaningful concessions from all involved in the motor industry'.