U.S. auto-parts suppliers are asking for up to $20.5 billion in federal aid to survive the worst industry downturn in decades,
Suppliers are requesting $10 billion in direct loans from the Treasury Department, said Neil De Koker, president of the Original Equipment Suppliers Association in suburban Detroit. The suppliers also are asking for an additional $10.5 billion that will flow through Detroit's automakers so that suppliers can be paid in 10 days for parts delivered instead of the traditional 45 days.
Suppliers are in need of cash as they confront first-quarter North American production cuts of more than 40% and a 66% plunge in January. De Koker estimates that hundreds of parts makers will close or file for Chapter 11 protection without immediate aid, according to
The suppliers made the Treasury request through the Motor & Equipment Manufacturers Association, De Koker said. The request was delivered to Treasury officials on Feb. 1, he said.
have received $13.4 billion in federal loans to stay afloat, while
has reiterated it doesn't need the government funding.
This article was written by a staff member of TheStreet.com.