U.S. Pumps $5.0 Billion in Support of Auto Suppliers

April 8, 2009
Auto suppliers that typically wait between 45 and 60 days for payment can now seek public guarantees on the money owed in order to obtain loans.

The U.S. Treasury Department on April 9 launched a $5 billion scheme to guarantee product payments to embattled auto suppliers that have been hammered by the auto industry slump and tight credit.

Government-rescued General Motors and Chrysler launched the taxpayer-backed support programs, the Treasury said.

Under the Treasury's auto supplier support program announced in mid-March, up to five billion taxpayer dollars will guarantee money owed to auto suppliers for the products they ship even if the US automaker goes bankrupt.

Auto suppliers that typically wait between 45 and 60 days for payment can now seek public guarantees on the money owed in order to obtain loans. Suppliers have been hamstrung amid a global financial crisis that has seized up credit.

"These efforts, backed by US Treasury resources, will help stabilize the auto supply base and restor credit flows in a critical sector that employs more than 500,000 American workers across the country," said Jenni Engebretsen, a Treasury spokeswoman.

GM and Chrysler have received a combined $17.4 billion in public aid since December.

Copyright Agence France-Presse, 2009

Popular Sponsored Recommendations

How to Build Zero-Cost On-Site Solar and Storage Projects

Nov. 25, 2023
The Inflation Reduction Act offers tax credits, incentives, and financing that enable no-cost projects. In Enel’s eBook, discover the critical role that incentives play in your...

Shifting Your Business from Products to Service-Based Business Models: Generating Predictable Revenues

Oct. 27, 2023
Executive summary on a recent IndustryWeek-hosted webinar sponsored by SAP

Process Mining For Dummies

Nov. 19, 2023
Here it is. Everything you need to know about process mining in a single book, written in the easy-to-understand, hard-to-forget style that ‘For Dummies’ manages so effortlessly...

Beware Extreme Software

Sept. 24, 2023
As a manufacturer, you understand the importance of staying ahead of the curve and being proactive in your approach to technology. With the rapid pace of change in the industry...

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!