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U.S. auto parts supplier groups to request new federal aid

Posted Tuesday, Jun 9, 2009, 10:51 am in Employee News

U.S. car-parts suppliers plan to ask President Barack Obama’s auto task force this week for $8 billion to $10 billion in loan guarantees, after negotiating federal loans earlier this year, Bloomberg reported.

Industry trade groups will request that the U.S. Treasury back at least a part of loans for auto suppliers from banks to lessen risk and increase lending, Neil De Koker, president of the Original Equipment Suppliers Association, told Bloomberg. The banks may be part of a group of lenders who could choose the suppliers to receive loans, he told the news service.

Suppliers such as Visteon Corp., spun off from Ford Motor Co., and seatmaker Lear Corp. have lost revenue as automakers cut production amid a 37 percent drop in U.S. vehicle sales this year through May, the story said. Their cash flow was crimped further by production disruptions as General Motors Corp. and Chrysler LLC sought bankruptcy court protection, De Koker said. (Bloomberg)
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