US car manufacturers will be strictly monitored by federal authorities under a draft of the government rescue package that has been made public. They would also have to drop lawsuits against California’s emissions laws.
The document reveals that there is no agreement on the final amount of money to make available to the car firms. Some lawmakers want to lend more than $15 billion to Detroit’s Big Three - who originally asked for $34 billion.
GM, Ford and Chrysler would have to submit a restructuring plan to a government-picked ‘financial viability advisor’ by 31 March.
The advisor will have the power to reject the plan or start negotiations between the company, workers unions and creditors. This restructuring is expected to lead to thousands of job losses.
Detroit’s Big Three and other global motor manufacturers have long taken legal issue with California’s greenhouse gas laws, which they say create unworkable sales conditions and complicate manufacturing. The on-going dispute would have to be dropped.