Top executives of Chrysler LLC took pleas for billions in new loans to members of the Obama administration’s auto task force Wednesday.
Chrysler Chairman and CEO Bob Nardelli, Vice Chairman Tom LaSorda and Chief Financial Officer Ron Kolka huddled behind closed doors with the administration panel, said a Chrysler official, who spoke on condition of anonymity because of the private nature of the talks.
Struggling to survive, Chrysler and General Motors Corp. have received $17.4 billion in federal loans. They are seeking an additional $21.6 billion to keep operating during a difficult recession and a major plunge in auto sales.
Auburn Hills, Mich.-based Chrysler has received $4 billion in loans and wants another $5 billion in federal aid and the approval of an alliance with Italian automaker Fiat SpA.
The company said in a Feb. 17 progress report that it needed the loans to stave off a liquidation of the company. The automaker lost $8 billion last year.
President Barack Obama’s auto task force is trying to restructure GM and Chrysler by March 31. If GM and Chrysler fail to make a convincing case, the administration could pull the loans and essentially force the companies into bankruptcy protection.
Obama, in his speech to Congress on Tuesday, said, “Years of bad decision-making and a global recession have pushed our automakers to the brink” and the U.S. should not “protect them from their own bad practices.”
But he said the administration was “committed to the goal of a retooled, re-imagined auto industry that can compete and win. Millions of jobs depend on it. Scores of communities depend on it. And I believe the nation that invented the automobile cannot walk away from it.”
Members of the task force, led by Treasury Department advisers Steven Rattner and Ron Bloom, met with lawmakers and suppliers earlier in the week and are scheduled to meet with GM executives on Thursday.
General Motors has said it could run out of money by the end of March and needs $2 billion in March and another $2.6 billion in April to stay in business.
GM spokesman Tom Wilkinson said the executives will travel to Washington by commercial airline. After being skewered by lawmakers for flying in corporate jets to seek government loans last year, GM announced it would return its five leased jets to their leasing companies and disband its aviation operations.