US carmakers warn of “carmageddon”

Executives from America’s big three carmakers have appeared before Congress with a begging bowl, pleading they need massive financial help if they are not to go under, taking hundreds of thousands of jobs with them.

They are hoping for more than 20 billion euros of aid, but the Senate appears divided, with many arguing that the carmakers’ business model is broken and they should be allowed to go bankrupt.

The industry argues one in 10 American jobs depend on their survival, and four million jobs worldwide. Congress is likely to demand plenty of strings attached to any bailout, including more fuel-efficient models.

Foreign subsidiaries, like Opel in Germany or Britain’s Vauxhall, part of the General Motors empire, are watching events in Washington anxiously. Brussels is also monitoring negotiations as Europe’s carmakers are seeking aid too, and the EU will also be wary of unfair competition and protectionism issues.

Copyright © 2009 euronews

tags: Financial Crisis