The new Auto Supplier Support Program announced last week by the U.S. Department of the Treasury will provide up to $5 billion in financing to vehicle parts manufacturers, “giving suppliers the confidence they need to continue shipping parts, pay their employees and continue their operations,” according to the government agency.
Reacting to the announcement, MEMA President Bob McKenna said, “This is a tremendous step toward stabilizing the supply base, which will benefit the domestic automotive manufacturing industry.”
The vehicle supply industry, which employs approximately 500,000 U.S. workers, is struggling with tight credit and dismal automotive production and sales volumes. According to the Treasury, “this program will help break this cycle and provide confidence in the supplier base at an important time for the domestic auto industry. It is part of the administration’s broader efforts to ensure that our Financial Stability Plan reaches the main street businesses that create good jobs for American workers.”
According to the plan:
“The Supplier Support Program will help stabilize a critical component of the American auto industry during the difficult period of restructuring that lies ahead,” says Treasury Secretary Tim Geithner. “The program will provide supply companies with much needed access to liquidity to assist them in meeting payrolls and covering their expenses, while giving the domestic auto companies reliable access to the parts they need.”
