After Congress failed to pass a bill to help the US auto industry, today President Bush approved $13.4 billion in immediate relief to GM and Chrysler and another $4 billion in February. This is a very big deal for the automakers - many analysts believe them to be days away from running out of money. The tricky part about this loan is that they need to pay it back in the next 3 months. That means there will be massive cuts at both GM and Chrysler to the tune of $13.4 billion to settle up with Uncle Sam come the end of March.
It will be up to the Obama administration to decide if additional government support is warranted and deserved. The much talked about "Car Czar" will be Treasury Secretary Paulson for the time being. This massive chunk of change will come from the $700 billion set aside for the financial industry bailout. Stay tuned as there will be major changes in the coming weeks and months to the face of the American car industry.