US auto suppliers make formal request for govt aid

U.S. auto suppliers of Friday submitted a request to the U.S. Treasury to secure emergency funding to avoid a wave of bankruptcies and a deeper crisis in the auto industry.
The request, which was submitted by two industry groups, outlined three proposals for financial relief for parts suppliers to the U.S. government.
The proposals say the government could guarantee supplier receivables from U.S. automakers, accelerate payment terms or guarantee commercial loans to part companies.
The document was submitted to the U.S. Treasury by Motor & Equipment Manufacturers Association and its affiliate, the Original Equipment Suppliers Association
The requests come as General Motors Corp (GM.N: Quote, Profile, Research) and Chrysler LLC race to meet a Feb. 17 deadline to show U.S. officials they can be made viable after receiving $17.4 billion in aid.
Bob McKenna, president of the Motor & Equipment Manufacturers Association, which represents some 400 suppliers, warned that without government action, auto suppliers will be forced to shutter facilities or close entire operations in March and April.
"This would devastate the domestic auto industry and deepen the economic crisis," he said in a statement.
Auto parts suppliers have come under intense pressure from tight credit conditions and from plant shutdowns by major automakers at the end of last year and the beginning of 2009.
Projections from parts suppliers show payments to the companies are on track to drop to just $2 billion to $3 billion in March because of the near total shutdown in auto production at the start of the year, according to MEMA data. Suppliers had been receiving between $8 billion and $9 billion per month.