Auto Task Force Takes Detroit Road Trip

Members Considering Additional Loans

Ronald Bloom, second from the left, Diana Farrell, and Brian Deese, right, arrive in a Jeep Grand Cherokee at Chrysler's Warren, Mich. truck plant where they met with Chrysler managers.
Ronald Bloom, second from the left, Diana Farrell, and Brian Deese, right, arrive in a Jeep Grand Cherokee at Chrysler's Warren, Mich. truck plant where they met with Chrysler managers. (By Jeff Kowalsky -- Bloomberg News)
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Washington Post Staff Writer
Tuesday, March 10, 2009; Page D03

President Obama's auto task force gave Detroit a close-up inspection yesterday as members consider whether to extend additional loans to the struggling automakers.

It was panel's first trip to Motor City since Treasury Department advisers Steven Rattner and Ron Bloom began their fact-finding meetings two weeks ago. Their visit coincided with an announcement by the United Auto Workers, saying members had ratified an agreement to give Ford more flexibility in how it meets its obligation to provide future health care for retirees.

The task force is racing against the calendar to address General Motors' and Chrysler's looming cash constraints. By the end of this month, GM needs at least $2 billion and Chrysler needs $5 billion to hold off bankruptcy.

Rattner and Bloom were joined by National Economic Council members Diana Farrell and Brian Deese.

Driving around town in a Jeep Grand Cherokee, they met with GM chief executive G. Richard Wagoner Jr. at the company's technical center in Warren to test-drive an early prototype of its highly anticipated plug-in electric car, the Chevrolet Volt, as well as Chevrolet Equinox, a hydrogen fuel cell sport utility vehicle, said people familiar with the visit, who were not authorized to speak publicly because the meeting was private. The panel also examined a line-up of vehicles that will be unveiled over the next year.

Later, they convened at Chrysler's Warren truck plant, or "Dodge City," where workers have been building trucks since 1938. The foursome met with Chrysler's management, including chief executive Robert L. Nardelli and vice chairmen Jim Press and Tom LaSorda.

Task force members also had an appointment with United Auto Workers President Ron Gettelfinger at the union's Detroit headquarters, Solidarity House. The union told the panel that 59 percent of production workers and 58 percent of skilled-trade workers voted for a deal that would allow Ford to pay up to half of its $13.2 billion health-care commitment with stock, alleviating the automaker of its big cash obligation.

"The voting results show that our members are prepared to make painful sacrifices in order to be part of the solution to the problems facing Ford and the U.S. auto industry," UAW Vice President Bob King, who runs the union's Ford department, said in a statement.

After contract talks collapsed with GM, the UAW turned to Ford last month. Analysts say the new Ford contract could serve as a model for ongoing negotiations with GM and Chrysler.

Obama has called for concessions by all stakeholders. Yesterday's visit by the government's task force "provided a constructive glimpse of GM people, their passion for their work, and the technology solutions that are behind the pages of our viability plan," GM said in a statement.

To date, the task force has called meetings with nearly every major industry player, from dealers to bondholders. This week it will meet with Toyota, its second meeting with a foreign automaker, to discuss the state of the industry.

So far participants have said the meetings have focused on educating the Treasury on the world of auto manufacturing. Task force members peppered them with questions and gave few hints about their thinking on additional financial assistance.

"Seeing Michigan autoworkers and the exciting new technologies they are producing in action will undoubtedly be very useful in establishing policy recommendations that will help our industry weather the credit crisis and compete and win in the global economy," Rep. Gary Peters (D-Mich.) said in a statement.

While the auto industry's fate remains largely an executive decision, top Republicans -- Sens. John McCain of Arizona and Richard C. Shelby of Alabama and Rep. John A. Boehner of Ohio -- spoke over the weekend against giving additional aid to GM and Chrysler.

"The best thing that could probably happen to General Motors, in my view, is they go into Chapter 11," McCain said on the TV show "Fox News Sunday."

Staff writer David Cho contributed to this report.

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