General Motors today asked for up to $30 billion in federal aid through 2011, while Chrysler LLC asked for an additional $2 billion beyond what has already been committed to it as the automakers submitted interim plans for turning their operations around.
Both companies submitted their reports to the Treasury Department detailing how they intend to spend the money authorized late last year and additional aid to avoid having to file for bankruptcy.
General Motors has already received $13.4 billion, including a $4 billion infusion today. The new funding request of about $16 billion includes $7.5 billion in credit in case the depression in the automobile market continues.
GM said it plans to cut its workforce by 47,000 hourly and salaries jobs by 2012, with 20,000 of those cuts affecting U.S. workers.
GM also will decide by March 31 whether to sell or phase out its Hummer brand; has offered to sell its Saab brand; and will spin off, sell or phase out its Saturn brand after the current product lifecycle expires after 2011.
GM CEO Rick Wagoner called today's interim plan a "comprehensive and bold update" to discussions that began last year on how to make the largest U.S. auto company profitable. Wagoner said the company is trying to avoid filing for bankruptcy, which he said would be a "highly risky and costly process."
The company has closed 12 U.S. manufacturing facilities since 2000 and will close another 14 facilities by 2012, five more than were included in its initial Dec. 2 restructuring plan.
Discussions between GM and the United Auto Workers and bondholders to reduce its labor costs and debt are ongoing. "There's good process in both of those areas and more to do," Wagoner said.
The UAW announced it has reached "tentative understandings" with all of the Big Three auto companies on changes to agreements made in 2007.
"The changes will help these companies face the extraordinarily difficult economic climate in which they operate," according to a UAW statement.
House Speaker Pelosi, who along with Senate Majority Leader Reid urged automakers in a letter last week to offer serious plans, said the plans represent "the next step in what has been a difficult and disappointing chapter for the American economy, but I hope will become the transformation of our domestic automobile industry into a viable, technologically advanced, and globally competitive manufacturing force."
Discussions are still continuing between with Chrysler, General Motors and Ford regarding how the companies will continue to help pay for health benefits for retirees, the UAW statement said.
This is considered a main sticking point before either Chrysler or GM can send their final proposals to Treasury by March 31.
Ford has not yet sought federal assistance, but wants to structure
its labor and other
agreements based on what is agreed upon with Chrysler and GM.
In a statement, Jim Hinrichs, Ford's vice president for global manufacturing and labor affairs, said the company and UAW reached a tentative labor agreement Sunday afternoon that includes "modified provisions on labor costs, benefits and operating practices that allow Ford to reach competitive parity with foreign-owned automakers' manufacturing operations in the U.S." Neither UAW nor Ford said they will offer details until an agreement is reached regarding the retiree health benefits.