ROBERT SIEGEL, host:
Ford, GM and Chrysler have come to Washington to ask for money. The leaders of Detroit's big three met with House Speaker Nancy Pelosi this afternoon. They're seeking $25 billion in emergency loans. That's on top of the 25 billion Congress already approved this fall. General Motors and Chrysler are facing their worst sales numbers in years, and they are warning of dire consequences if the economy doesn't improve. NPR's Frank Langfitt is over at the Capitol building, and he joins us now. And Frank, tell us about why the companies need this money.
FRANK LANGFITT: Well, they're really in bad shape. You know, sales were bad, Robert, when gas prices were high. But now, with the credit crunch, it's really what looks like a recession, consumer demand has really collapsed. GM right now is burning through about a billion dollars a month, and analysts say it needs a new infusion of cash, or it could run out sometime next year.
SIEGEL: Well, some of the auto executives have been making the rounds of Washington for weeks, hat in hand, going to many different agencies. Now to Pelosi, why?
LANGFITT: Well, they're not having much luck anywhere else. They went - they were looking at the $700 billion Bailout money, but the Treasury wasn't really very receptive. You know, at the time, GM was talking about using that money to merge with Chrysler, but it was going to cost tens of thousands of jobs and Treasury, you know, understandably, they didn't like the idea of giving taxpayer money to pay for a merger that was going to, you know, cost - put so many people out on the street. You know, another place they went is the Department of Energy. As you mentioned at the top, they already have about 25 billion for the companies. But that's for fuel efficient technology, not operating expenses. So, the companies going to apply early next week, but it's going to take time, and it has to be used for research and development.
SIEGEL: Well, if the Congress did decide to provide support, how would that support work and when would the automakers get it?
LANGFITT: Well, the hope is, from their perspective, just the thing John mentioned earlier, and that is this potential lame duck session, later in the month, when there might be a fiscal stimulus bill. And what they're hoping is that, in pumping money into the economy, kick starting it, the House of Representatives is hoping to pass this through to avoid, you know a deeper recession, what the auto companies are hoping for is to get money in that package for themselves. In theory, this would be the quickest way for them to get it, and they could tie it closer to the idea of recession, which might create a little more political cover for them.
SIEGEL: But many people blame the auto companies for their own problems. US automakers built big profit SUVs, and then the market for those cars fell when gas spiked. Is there really that much support for bailing out oil - auto companies, rather when we can see that the $700 billion financial Bailout was very unpopular with the voters in Tuesday's election?
LANGFITT: Well, you know, I haven't seen any polls on this, but we did a chat last week on our website on this very question, and of course, it's unscientific, but we got a lot of angry opposition. Some argued that the companies can't make it, you know, they should be allowed to go bankrupt. There was a guy named Henry Davies(ph), who wrote in from Detroit, and he said, I feel that we should do little to help these poorly managed businesses that have not kept up with a well-balanced product. They've treated the American consumer with contempt for decades. So, you know, there was a lot of opposition out there. Of course, if they go bankrupt, what the, you know, auto companies say, it's not just going to be huge job losses in factory floors, but it's also going to spread to dealerships and part suppliers, so it could make the recession that much worse.
SIEGEL: Yeah, but one of the central questions here is, if the auto companies did get a Bailout, would that, in fact, solve their problems?
LANGFITT: You know, that's the great question here. And here's what the auto companies say. They say you know if we can get to 2010, we're going to see some big savings from health care cuts they did last - they negotiated last year with the union, and they think they can turn it around. Of course, a lot of Americans feel like they've heard this before. In the meantime, you know, we have too many workers making too many cars for people who just aren't buying them. So, it looks like there could be a need for more layoffs, and that's one of the things that the union is bracing for. Ron Gettelfinger, he's the head of the union, he was there in the meeting today, as well.
SIEGEL: Thank you, Frank.
LANGFITT: Happy to do it, Robert.
SIEGEL: That's NPR's Frank Langfitt speaking about talks between the big three auto makers and Speaker of the House Nancy Pelosi.
NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.