$17.4bn rescue package for failing car companies
Last week the first initial bail out package for struggling US car companies was set in the region of $14 billion. The bill was never passed and many of the car companies were left scratching their heads, with fears that two of the largest car companies MG, and Chrysler would be forced to shut down factories and force many people out of work. The companies are finding it hard to stay alive in the serious economical times it’s reported that around the world average car sales from across the board of other companies is set to be down by a third this year alone, with larger falls in sale predicted.
With that, last week George Bush vowed to get a bail out package ready, other wise face an increasing number of unemployment with figures shown to be in the region of 3 million people, if the bill was never granted.
Members of the White house vowed to put forward money, and today they have. President George Bush announced today that a bail out package will be put in to place, with the whole amount set to be $17.4bn, but not all of the money will be given to the car companies straight away. $13.4 bn will be given as a first payment with Chrysler & MG getting a further $4 bn later on. Mr Bush says,’ that under any other circumstances this money would not be given to these companies, as they have done nothing but bad business decisions, but because of the global financial down turn i have no choice but to step in and help.’
‘These are not ordinary circumstances, in the midst of a financial crisis and a recession allowing the US auto industry to collapse is not a responsible action,’
There were certain obligations that came with this package, they had to speak to unions and cut wage packets to compete with other foreign companies working inside the United Stated.
Allowing these companies to just go bankrupted would just be economical suicide, which would only make a damaged economy further broken.
