8:11 am, December 11, 2008
STATE aid of nearly £10bn for the crisis-hit US car industry last night neared full approval in Washington.
A bail-out package has been approved by the US House of Representatives.
If it passes approval from the Senate, US auto makers will have the financial aid they desperately need. However, opposition from Republican politicians could still delay the package.
Any bail-out will lead to more Government control of the car makers. Some call it part-nationalisation, with the US President having the power to control distribution of the cash.
Aid will help keep the particularly vulnerable GM and Chrysler brands in business for the next few months. Ford is less dependent on funds, but says access to finance would reassure investors.
If the bail-out package is approved, the brands will have to submit restructuring proposals to the US Government. It is expected that these could include a merger between GM and Chrysler.
Plans will also lead to the introduction of more fuel-efficient vehicles, including plug-in hybrids such as the Chevrolet Volt.
Car Dealer will be following the situation closely. Come back for more news as it happens.
