WASHINGTON — Humbled and increasingly desperate as car sales plummet, the heads of the country's Big Three automakers told Congress on Thursday that they were willing to accept oversight of their spending in return for $34 billion in government loans to keep them afloat.
The chief executives also said they would be amenable to taking the money in stages, which would allow the government to put the brakes on additional funding if the companies were not making solid progress reinventing themselves as leaner, profitable enterprises.
But skepticism remained high on Capitol Hill during a hearing of the Senate Banking Committee, with lawmakers questioning Detroit's commitment to becoming more competitive and worrying that the taxpayers' money would quickly be frittered away.
As a result, General Motors Corp., Ford Motor Co. and Chrysler still face tough odds in getting government help this year.
"In just two short weeks the price tag has jumped from . . . $25 billion to $34 billion," said Sen. Richard C. Shelby of Alabama, the Banking Committee's top Republican. "I'm interested in hearing what changed and why we should believe things will get better."
Democrats are generally more sympathetic to the automakers' plight, saying thousands of jobs would be lost -- and the nation's industrial might jeopardized -- if any of the automakers is allowed to collapse.
"None of us relishes this task that we are asked to consider, yet who among us believes we should risk the consequences of the collapse of . . . one or more domestic automobile manufacturers?" Banking Committee Chairman Christopher J. Dodd (D-Conn.) said at the start of a nearly six-hour hearing. "Make no mistake about it -- those consequences would be severe and sweeping."
The auto executives face another grilling today, when they appear before the House Financial Services Committee, which gave them an even rougher mauling than the Senate panel last month.
The idea of paying out government funds in installments rather than all at once appeared to gain traction among members of Congress, though nothing approaching a final deal was at hand.
As described to the auto executives, about half the money would be disbursed quickly to keep the companies afloat through March 31. The rest would be held back until a government board of trustees was convinced that the companies were making progress toward becoming more competitive and retooling their lineups to offer more fuel-efficient cars.
