"Considering my job and things going for the worse, it's not good," said Javier Alvarez, assistant service manager at Star Chrysler/Jeep in Glendale. He said sales and service business at the dealership had dropped 30% to 40% this year.
American automakers are not alone in suffering weak sales amid the recession and credit crisis. Honda Motor Co., which saw its U.S. sales decline 32% in November compared with last year, said Friday that it would deepen already announced cuts in first-quarter production, eliminating a total of 175,000 cars and trucks from its planned output.
But U.S. automakers -- and the hundreds of thousands of direct and indirect jobs they provide -- were the main concern of the Bush administration and lawmakers. A failure of one of Detroit's Big Three could take all of them down because of the supply chain they share, leading to the loss of hundreds of thousands of jobs.
The bailout legislation, which passed the House on Wednesday but was killed by Republican opposition in the Senate on Thursday, would have provided up to $14 billion in emergency government loans to GM and Chrysler.
The money would have come with restrictions, including a requirement that the companies that accept aid outline plans for major restructuring by March 31 under the oversight of an industry monitor, or "car czar," appointed by the president.
Democratic leaders in Congress have pushed Bush to use the Wall Street fund to provide emergency aid to the automakers. He had adamantly resisted, preferring that Congress redirect money from an existing $25-billion fund to help automakers retool their factories to produce more fuel-efficient vehicles.
Bush was briefed on the legislation's failure late Thursday and was in consultation with his economic advisors, Perino said.
Paulson could allow short-term loans from the $700-billion fund and attach conditions similar to those laid out in the failed legislation or others. The administration could lend the automakers just enough money to get them through late January, when President-elect Barack Obama will be inaugurated.
"Because Congress failed to act, we will stand ready to prevent an imminent failure until Congress reconvenes and acts to address the long-term viability of the industry," said Treasury Department spokesman Brookly McLaughlin.
