The federal government will enable Detroit's ailing automakers to survive a little longer by providing $17.4 billion in short-term financing in exchange for concessions from carmakers and their workers.
President Bush said Friday that a bankruptcy was unlikely to work for the auto industry at this time because it would deal "an unacceptably painful blow to hardworking Americans" across the economy.
The low-interest loans will be drawn from the $700 billion Wall Street rescue fund, Bush said.
One official said $13.4 billion of the money would be available this month and the next, $9.4 billion for General Motors Corp. and $4 billion for Chrysler LLC. Ford Motor Co. has said it does not need immediate help.
Bush said the loans will be called back if the companies are not viable by March 31.
"The time to make hard decisions to become viable is now, or the only option will be bankruptcy," Bush said. "The automakers and unions must understand what is at stake and make hard decisions necessary to reform."
Bush's plan is designed to keep the auto industry running in the short term, passing the longer-range problem on to the incoming administration of President-elect Barack Obama.