DETROIT — The American auto industry is running on fumes.
General Motors, the nation’s largest automaker, warned Friday that it might run out of money by the end of the year after piling up billions in third-quarter losses and burning through cash at an alarming rate. Ford sustained heavy losses too.
The situation is so severe that GM has suspended talks to acquire Chrysler and is appealing to the government for help as the slumping economy drags cars sales to their lowest level in a quarter-century.
GM chairman and chief executive Rick Wagoner said the company will “take every action” possible to avoid bankruptcy.
“We’re convinced that the consequences of bankruptcy would be dire,” he said, adding that the company would use every source of potential funding. “We need to find a way to get through this, and that’s really our focus.”
GM also planned more job cuts, including another 5,600 salaried and factory workers. Company officials cautioned that those measures alone would not be enough and that federal aid is essential.
Ford saw its cash supply decline rapidly and announced its own job cuts Friday. The Dearborn-based manufacturer said it had enough cash to make it through 2010.
Friday’s events called into question the future of Detroit’s three automakers and heightened pressure on the government to take action.
President-elect Barack Obama on Friday indicated that help might be on the way. At a Chicago news conference, he said Congress must pass an economic-stimulus measure either before or just after he takes office in January, and he mentioned aid for the auto industry. The Associated Press
