Chrysler, Auto Industry | featured news

Executives at General Motors and Chrysler are speeding to put in place workable plans to restore their dwindling operations. It’s a race they might not win.

The moves come less than an hour after Obama tells the two carmakers to take another stab at redesigning their companies, a requisite for receiving more federal funds.

Less than an hour after President Obama said a major overhaul was needed to save the auto industry, Chrysler announced that it had formed the framework of an alliance with Fiat, while at General Motors Corp., new leaders took charge after the chairman was forced to step down

President Obama is making a formal announcement this hour about his plans for troubled automakers General Motors and Chrysler, which have already been given $17.4 billion to keep them running.

President Barack Obama will announce the next steps to help General Motors Corp and Chrysler LLC on Monday, the White House said, amid signs of progress for GM in talks aimed at slashing its debt and cutting costs in response to slack demand.

The president's chief of staff criticized U.S. car companies Sunday for relying too long and gas guzzlers and not investing enough in alternative energy vehicles.

Automakers tell the Obama administration that they need at least an additional $14 billion in loans in order to survive economic downturn.

The struggling American auto maker Chrysler, owned by the private equity firm Cerberus Capital Management, signed an agreement with Fiat on Tuesday that would give the Italian car maker a 35% stake in the company.