WASHINGTON (CNN) - President Barack Obama announced Monday that struggling automotive giants General Motors and Chrylser will be given a "limited" period of time to "restructure in a way that would justify an investment of additional taxpayer dollars."
The federal government will give GM "adequate working capital" over the next 60 days to work in conjunction with the administration in developing a better recovery plan, he said.
Chrysler will be given "adequate capital" to continue operations for 30 days while completing a merger with automaker Fiat. The president said that if Chrylser can come up with a "sound agreement that protects American taxpayers, we will consider lending up to $6 billion to help their plan succeed."
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Obama also indicated that both GM and Chrylser might need to file for bankruptcy in the process of successfully restructuring, which will involve working with "creditors, unions and other stakeholders."
"While Chrysler and GM are very different companies with very different paths forward, both need a fresh start to implement the restructuring plans they develop. That may mean using our bankruptcy code as a mechanism to help them restructure quickly and emerge stronger," Obama said in remarks delivered at the White House.