The proposed $14 billion rescue package for US automakers has been approved by the House of Representatives, it was confirmed today (11th December).

The bail-out loan, which is mainly aimed at the 'Big Three' of General Motors, Chrysler and Ford, was passed by 237 votes to 170 after leading Democrats reached an agreement with the White House.

Under the terms of the deal, the companies now have until 31st March to submit their plans for using the money to the 'Car Tsar', who will be appointed as part of the new arrangements.

White House Spokeswoman Dana Perino said: "We believe the legislation developed in recent days is an effective and responsible approach to deal with troubled automakers and ensure the necessary restructuring occurs."

However, there could be an impending delay as the plans have proved unpopular with Republicans in the Senate, where the Democrats have a wafer-thin majority of just one.

The Republicans have instead expressed their desire to let the firms file for bankruptcy, while simultaneously protecting private investment in them through a government insurance system.

Tennessee Senator Bob Corker said: "People realise that this bill is an incredibly weak bill [and] is the product of an administration that wants to kick the can down the road and let somebody else deal with it."

'The Big Three' have all seen their US sales figures suffer an alarming slide this year, while European and Japanese automakers in the US have also been badly affected.



Source:

US House backs car industry plan (11/12/08)
http://news.bbc.co.uk/1/hi/business/7774459.stm