By Pamela Gentry, Senior Political Analyst

March 30, 2009 – American automakers are given another lease on life by President Obama but not for long.  Former auto giants General Motors and Chrysler were given a do or die ultimatum: Get new leadership, a financial survival plan and a new vision that outlines how the industry will go forward without additional federal dollars.

The president, flanked by his team at the White House announcement, said his administration will be more “hands-on” in the restructuring of the automakers and wants to see immediate changes.

“I am announcing that my administration will offer GM and Chrysler a limited period of time to work with creditors, unions and other stakeholders to fundamentally restructure in a way that would justify an investment of additional tax dollars; a period during which they must produce plans that would give the American people confidence in their long-term prospects for success,” the president said.

If the automakers want to avoid reorganizing under the dreaded bankruptcy law, this could be their last chance.   Both companies will get more short-term money from the feds to help with the restructure with some strings attached.

The task force that worked on a plan for the car manufacturers wants to see the companies move quickly; Chrysler will have 30 days to revise their plan and General Motors will have 60 days. Chrysler has been instructed to work out a partnership with the Italian auto maker Fiat.

A lot is riding on the success; just last week auto suppliers were given $5 billion from TARP money to keep their businesses afloat while awaiting the fate of the big three.

“These companies and this industry must ultimately stand on their own, not as wards of the state,” Obama sounding a warning the bailout money is nearing its end. 

Do you agree with Obama on how much help the auto industry should receive from the government? 

TAGS: Chrysler, General Motors, President Obama

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