John Hughes and Laura Litvan
December 2, 2008
Ford Motor Co. asked Congress for a credit line of as much as $9 billion, saying it expects to break even or be profitable before taxes in 2011.
The automaker said it hopes to avoid tapping the financing and doesn’t anticipate a “liquidity crisis” in 2009, barring a competitor’s bankruptcy or more severe economic slump. Ford plans to sell five corporate jets and would pay Chief Executive Officer Alan Mulally a $1 annual salary if the loan is used. General Motors Corp. and Chrysler LLC were to submit plans later today.
“We hope that we can work something out” with the automakers, Senate Majority Leader Harry Reid, a Nevada Democrat, told reporters. “We don’t want to throw them a lifeline if the lifeline doesn’t get them to the shore.” Lawmakers set hearings for Dec. 4 and 5 and may vote on an aid proposal next week.
Ford, GM and Chrysler must convince a divided Congress that their plans to shrink are severe enough to ensure repayment of $25 billion in proposed loans. Lawmakers are split on whether any aid should come from a $700 billion bank-rescue fund or Energy Department loans approved in September.