Government Role in Us Auto Industry

The Government plays a major role in the automotive industry. In fact without the

Government, the US auto industry would probably completely out of line with one major ruler

of the industry. Between December 2008 and March 2009, the Treasury Department established

a series of programs to help bring relief to the U.S. auto industry in hopes to prevent the

major economic disruptions that would come from a sudden collapse of Chrysler and GM. In

December 2008 the Treasury provided both companies with a bail out; $4 billion to Chrysler and

$13.4 billion to GM. With this they also required that by February 2009, only 2 months later,

that each company would have a restructuring plan in place. That March the Treasury decided

that the automakers’ restructuring plans were not sufficient to achieve long term viability and

required that they take more aggressive action as a condition of receiving additional federal

assistance. Meanwhile the Treasury also set up programs to ensure Payments to suppliers of parts

and components needed to manufacture cars and to guarantee warranties of cars Chrysler and

GM were to sell during the restructuring period.

In providing assistance to the Auto Industry, Treasury identified goals and objectives

and took steps to protect Government interests. Provisions to protect the Governments interest