The U.S. auto industry deserves America's support for the sake of the millions of people who work in our industry and for the health of the overall economy. The hundreds of billions of dollars that taxpayers have been asked to contribute to Wall Street banks and investment houses to "save our economy" will be wasted if we don't also support Main Street manufacturing.
The auto industry is requesting a bridge loan—not a handout—to address the impact of today's economic downturn and the global credit crisis. Many consumers, facing deep economic in-security, are delaying major purchases like automobiles. Few of those visiting auto showrooms can find affordable credit. The result is the lowest level of automobile sales in more than 25 years. Without steady revenue, our major auto companies cannot survive in a capital-intensive business.
This is an urgent crisis. The executives of Chrysler, Ford, and General Motors would not be asking for public assistance otherwise. Without immediate assistance in the form of a temporary bridge loan, GM, Chrysler, or both may not survive until the end of the year.
A bankruptcy reorganization would not work: No lender would provide transition financing in the current environment—and no consumer would buy a car from a company in bankruptcy. The result would be immediate liquidation of all operations. Thousands of companies that supply these automakers would also fail; Ford and other carmakers would then be unable to produce cars because of a lack of parts and supplies.
Such a catastrophic reduction in U.S. industrial capacity could quickly turn today's recession into tomorrow's global depression: 3 million lost jobs; thousands of business failures; hundreds of billions in lost tax revenues—far more than the bridge loan that will prevent this disaster.
Poor timing. Ironically, this situation has arisen when our industry has made progress on many of the problems we have faced. Our vehicles are winning quality awards, our plants are the most efficient in the industry, and we're meeting the challenge of producing more fuel-efficient vehicles for the future. GM has more vehicles getting 30 miles per gallon than any other manufacturer, Ford introduced the first hybrid SUVs, and Chrysler is a leader in neighborhood electric vehicles.
And thanks to substantial sacrifices by our union members—a wage freeze, tens of billions of savings on health insurance, deferred cost-of-living increases, and other measures that have affected autoworkers and our families—our new labor agreements make our employers competitive with any other automaker in America. We realize that in order to address the current crisis, all stakeholders—dealers, suppliers, bondholders, and others—will have to contribute even more to help our industry succeed. We stand ready to do our part. We're at the table every day, finding ways to continue to improve quality and to make our employers more efficient and competitive.
We know we can succeed, but we need help. Congress should impose tough conditions in exchange for taxpayer assistance, including limits on executive pay, elimination of dividends for shareholders, an equity stake for taxpayers, and an oversight board to ensure that public funds support jobs and businesses in this country.
The auto industry is being asked to provide a level of detail and transparency that was not demanded from the banks and financial institutions that received billions of dollars with no questions asked and with little oversight and accountability. We're ready to meet the challenge. In plans submitted to Congress last week, we're confident that automakers met the standards demanded by Congress. And our members, along with other stakeholders, are prepared to make the shared sacrifices required to move our industry forward.
If Congress does not let us down, we will not let the American people down. We can repay the taxpayers, preserve and grow American jobs and businesses, and rebuild a great industry.
Ron Gettelfinger is president of the United Auto Workers Union. He has been a member of the union since 1964.