President Barack Obama announced today that neither General Motors or Chrysler have made enough widespread changes to warrant further federal bailout money.
"We cannot make the survival of our auto industry dependent on an unending flow of tax dollars," Obama said.
But fears of the auto industry's total collapse is prompting the administration to offer GM another 60 days worth of "adequate working capital" to come up with an acceptable restructuring plan, and 30 days for Chrysler to finish a deal that would merge the company with Fiat, an Italian auto company. If Chrysler is successful, Obama said he will consider an additional $6 billion in aid.
Obama also said he will offer incentives to Americans to buy more domestic-made cars. People who bought cars after February 16 will be contacted by the IRS about deducting the cost of sales and excise taxes. The benefits will last until the end of this year. Obama also said the government will guarantee any GM or Chrysler warranties.
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