President Obama will likely approve billions of dollars more in loans to General Motors and Chrysler on Monday, but attach a deadline for union and bondholder concessions to help the automakers survive, insiders tell the New York Times. Obama's auto task force will also keep government-managed bankruptcy as an option for the two companies, which have almost blown through $17.4 billion in federal loans.
Obama will likely impose a short-term deadline—weeks, not months—for GM and Chrysler to wrap up restructuring negotiations with lenders and the UAW. Obama set the stage yesterday, saying the companies needed “drastic” and “painful” changes to stay in business. No numbers have been leaked, but GM has asked for $16.6 billion and Chrysler for $5 billion more in federal loans.