Auto suppliers are preparing to make another trip to your wallet. Auto suppliers are preparing to ask the U.S. Government (tax payers) for additional aid.

I guess we will begin to see auto parts manufacturers filing to become ‘bank holding companies’ so they can have a direct line to the tax payers (sarcasm intended).

US car parts suppliers are preparing to ask for more government aid, including incentives to encourage fresh private-equity investment in the sector.

The suppliers are also seeking access to the Treasury Department’s term asset-backed securities loan facility (Talf) and similar loans provided by the Small Business Administration.

The Treasury last month approved up to $5bn in government-backed credit insurance for suppliers to General Motors and Chrysler, the two carmakers being kept afloat by Washington.

Suppliers can also raise cash by selling receivables to the scheme at a discount.

But Neil De Koker, president of the Original Equipment Suppliers Association, said “there isn’t enough money in the programme to take care of all the suppliers. Many, many suppliers are still desperate”.[...]

[...]Delphi, which is GM’s biggest supplier and has been in bankruptcy protection since late 2005, has warned that shareholders are likely to recover nothing from its restructuring.

Source: Financial Times

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