07 November 2008 16:20 [Source: ICIS news]
WASHINGTON (ICIS news)--?xml:namespace>
John Engler, president of the National Association of Manufacturers (NAM), issued a statement saying that “the situation is dire” for US automakers.
“We’re talking about close to a million jobs in
“We simply cannot afford to let the auto industry fail.”
The big three US automakers - General Motors, Ford and Chrysler - have been meeting with leaders in Congress this week and have appealed for an immediate loan package of $25bn (€19.75bn) to keep the industry afloat until the new year.
Some in Congress have argued against the bailout on grounds that the federal treasury cannot continue to throw money at every
But Engler cautioned that collapse of the
Bruce Josten, executive vice president at the US Chamber of Commerce, told a press conference that “the auto industry has a huge footprint across our economy”.
“The auto industry is the largest buyer of steel and glass and other commodities, and it is the largest buyer of computer chips as well,” Josten said.
He said that while the auto manufacturing industry directly employs 350,000 workers, the sector indirectly supports as much as 10% of the 154m-strong
Engler noted that the industry is anticipating a deteriorating outlook for 2009 with as few as 12m car sales.
While that is a significant number of units, he said it pales in comparison with the average 17m annual new car sales seen over the three years prior to the economic downturn.
He cautioned that even with a new federal loan package, the auto industry “will likely undergo a fundamental structural change before January 20th”.
That is the date on which President-elect Barack Obama will take office.
Engler said it is essential that Congress and the Bush administration act now to sustain automakers through the rest of this year.
“If Chrysler were to disappear tomorrow - and it is the smallest of the big three automakers - you would see one million jobs taken out of the economy,” including workers in subsidiary industries that supply the auto sector, he said.
($1 = €0.79)
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