Obama to back auto industry bailout

President-elect Barack Obama has indicated he will back the American car industry’s plea for a huge bailout from the US Treasury.

Obama is believed to be supportive of a request made to Henry Paulson, the Treasury Secretary, asking him to financially support GM, Ford and Chrysler.

Obama called the flagging car industry “the backbone of American manufacturing" and insisted his team would put together a more aggressive rescue package than the Bush administration.

The move comes the week after GM and Ford signaled they would run out of money by the end of next year, potentially leading to a catastrophic loss of jobs.

Industry leaders have been clamoring to secure some of the $700 billion fund, which is meant to aid America’s financial system.

Secretary Paulson has already turned the carmakers request for funding down once, saying that he believes the money should be used to shore-up banks and to make credit available, which in turn would help the car industry. Autocar.co.uk

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