According to The Wall Street Journal, the Administration’s auto task force will recommend that the government give GM (GM) and Chrysler billions of dollars in more bailout capital rather than have them file for bankruptcy.
But, the desire of the government to keep the operators independent will come with conditions, and they may never be met. The Journal writes, “the task force is expected to say that it sees viable futures for both GM and Chrysler, but only if there are sacrifices from their managements, unions and GM’s bondholders. The team will also lay out a firm timeline for action.”
The unions and bondholders have known about the level of sacrifices that they will need to make since when The Big Three went before Congress last December. They have not been willing to give enough to solve Detroit’s problem during the negotiations of the last three months. There is no reason that there will be a change now.
The deal ain’t done. Not even close.
Douglas A. McIntyre
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