Groups work to keep carmakers out of bankruptcy

DETROIT -- President Obama's auto task force will meet in the next two days with two groups that are pushing to keep General Motors and Chrysler out of bankruptcy court.

The National Automobile Dealers Association is meeting with the task force this morning, and salaried retirees from GM, Chrysler, Ford Motor and Delphi are meeting with the task force Friday.

Although they have different agendas — the NADA is also pushing for the task force to help open up credit markets, and the retirees group just wants to be heard — both say they fear a bankruptcy filing for GM or Chrysler would be a mess.

"Bankruptcy will not work, and I don't think it's a viable option," says John McEleney, chairman of the NADA.

Dealers are hearing from customers that they won't buy a vehicle from a carmaker in bankruptcy, even if the bankruptcy is supposed to be quick. A bankruptcy filing "would be a self-fulfilling prophecy, and would probably end up being a liquidation."

In other words, with no revenue coming in, the companies would be sold off in parts.

McEleney says he's not sure how much more dealers can do. About 900 went out of business in 2008, and 300 went out of business in the first quarter. The NADA is projecting 1,200 total will go under in 2009.

"There are dealers who have lost their homes, and surviving dealers who are just barely hanging on," he says. "Dealers are sacrificing every day, and probably the ultimate sacrifice is losing your business."

Salaried retirees are getting their first audience with the task force on Friday, and bankruptcy will be high on their agenda.

Jack Dickinson, president of a GM salaried retiree group and administrator of the website OverTheHillCarPeople.com, says most Americans don't realize to whom the term "white-collar retiree" refers.