Morning:
8°c
GM in a drive to borrow from Fed
Bill Condie13 Oct 2008
US carmaking giant General Motors, in talks with rival Chrysler over a possible merger, is also expected to seek loans from the Federal Reserve as it struggles for survival.
The Fed is already buying shorter-term commercial paper from some companies, but GM is reportedly looking for debt with a longer maturity. The company would not comment.
The Fed can lend to GM without demanding collateral if it gets the votes of five of its board members, according to Barron's magazine.
GM has had preliminary talks with Ford and Chrysler. Talks with Ford were broken off and those with Chrysler are said to be bogged down on price.
All US carmakers are lobbying the White House to accelerate a $25 billion (£14.7 billion) loan intended to allow them to retool factories to build vehicles that are more fuel-efficient.
The move is expected to take months as regulators put into place rules that will govern distribution of the money.
