The Obama administration is talking with US auto industry about more help, but no decisions are expected until General Motors Corp and Chrysler LLC submit turnaround plans to the government later this month, a White House official said on Friday.
The Obama administration also confirmed the government's hiring of two law firms to assist Treasury Department officials on auto restructuring matters, but did not divulge plans for naming a trustee or "czar" to oversee the process.
"The administration is engaged at the highest levels - including the Treasury secretary and the National Economic Council director - on the issues affecting suppliers, dealers and the industry as a whole," the official said, referring to Treasury Secretary Timothy Geithner and Lawrence Summers, head of the National Economic Council.
"No decisions will be made on restructuring or anything else until we receive and review the restructuring reports due on (February 17)," the official said of the deadline for GM and Chrysler to show progress on meeting cost savings and other targets associated with their $17.4 billion December bailout.
"If the companies have determined some of the targets are not possible to meet in a timely fashion, they have the opportunity to explain their circumstances in their presentation," the official said. GM and Chrysler have until March 31 to demonstrate to the government that they can be commercially viable. GM and Chrysler told policymakers in December that they faced possible near-term collapse without the aid.
US automotive suppliers said on Thursday they were trying to secure government funding to avoid a deeper industry crisis including possible bankruptcies. Suppliers have presented three options to US officials that, combined, would total aid of some $25 billion.
The official said the Treasury and White House were "in communication with suppliers and the auto companies." GM and Chrysler bailout funds originated from Treasury's corporate rescue program mainly aimed at failing banks. Another $7.5 billion in capital was directed to financing companies GMAC and Chrysler Financial to stimulate lending to consumers to finance vehicle sales. Reuters reported on Thursday the government had retained two law firms with bankruptcy experience and the investment bank Rothschild to advise officials on restructuring.
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