General Motors calls on UK Govt. to rescue itDecember 13th, 2008 - 11:02 am ICT by ANI
London, Dec.13 (ANI): General Motors, which employs 5,500 people around the UK, is in talks with the British government to secure cash to allow it to continue operating in what the car maker admits are “critical” conditions.
A report in The Telegraph says that the talks follow a decision by the US Congress to vote down a 14 billion dollar loan package to support the American automotive industry on Friday.
The future of British workers at GM plants in Luton and on Merseyside is unclear, as does that of up to a further 5,500 people employed by parts suppliers.
The Gordon Brown Government is likely to take a cautious approach to requests to bail out the UK car industry. It is thought more likely to consider offering bridging loans.
GM said it was “very disappointed” with the US loan package’’s failure, but continued to “look at options to restructure and stabilize the business in this exceptionally difficult economic period.” It claimed to be operating “as usual”.
The car maker, which owns brands including Vauxhall, Saab and Opel, said it was in talks with unions and European governments in countries where it has big operations to “provide liquidity for sustaining operations”.
Underlining the urgency of the situation, GM said it would seek liquidity “while the US team pursues its options”.
GM is also in talks with the German government, where it has Opel production facilities,
in a bid to secure a credit guarantee.
The Swedish government yesterday announced a 28 billion Kronor support package to help the car industry. The plan offers credit guarantees, emergency loans and research funds to companies from Volvo to Saab.
Volvo is owned by Ford, which faces similar problems as does GM and Chrsyler.
According to The Telegraph, the Spanish region of Aragon, where GM has an Opel plant, has offered its own 200 million Euros credit guarantee. (ANI)
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Tags: automotive industry, bridging loans, car industry, car maker, cautious approach, chrsyler, credit guarantee, credit guarantees, critical conditions, dollar loan, emergency loans, european governments, german government, gm plants, gordon brown, loan package, spanish region, swedish government, uk govt, us congress