Washington - US President George W Bush and Congress are nearing a deal to approve a 15-billion-dollar bail-out plan for the troubled automotive industry, the White House said Monday. "Indications are that the legislation is moving more towards what the president could support," White House spokeswoman Dana Perino said, adding "it's very likely" the two sides will arrive at a proposal by late Monday.
Chrysler LLC, Ford Motor Co and General Motors Corp have warned that without government help they could be forced to file for bankruptcy and lay off tens of thousands of workers, sending the contracting economy into a further tailspin.
The US Senate and House of Representatives would have to approve the legislation before Bush signs it into law. Under the plan, the automakers could receive loans by December 15.
Leaders in the House of Representatives said later Monday that they were ironing out the details of bill to provide short-term financing that would take the 15 billion dollars from money already designated to help the industry create greener cars. They had earlier been at an impasse with the White House, with congressional leaders instead wanting to take the money from the 700-billion-dollar financial bail-out.
Under the plan, carmakers would have to show by March 31 that they had viable, long-term business plans before receiving any further money from Congress, Speaker Nancy Pelosi told reporters.
The White House still needed to examine the final wording of the legislation, Perino said. The legislation would establish an advisor to oversee the use of the government money and to verify that the three carmakers were retooling for long-term viability and carving out more stable futures.
The advisor would coordinate a long-term plan with Detroit after the Big Three have received assistance, Perino said. More financial help would follow only if the advisor finds that the companies are living up to their obligations and implementing the plans.
"If the viability advisor says that they are not making progress, then that company - the automaker - would have to pay the taxpayer back right away," Perino said. "So there's incentive for everybody to work hard to make this work."
Bush would appoint the advisor, who could be replaced by president-elect Barack Obama after his inauguration on January 20. Obama over the weekend voiced support for the plan but criticized the companies for their lack of vision and interest only in short-term gains.
The chief executives of Chrysler, Ford and General Motors appeared before Congress last week to request a combined 34 billion dollars in assistance, arguing that the money was essential to survive the current recession.
Congress required the executives to submit recovery plans before any financial would be considered. All three pledged to revamp business models, cut wages and speed up the rollout of more fuel- efficient vehicles.
