US President Barack Obama will launch a presidential task force on restructuring the beleaguered auto industry rather than entrust a "car czar" with the job, an administration official said.
The task force will encompass a string of US government agencies, including the departments of treasury, labor, transportation, commerce and energy, as well as White House energy and economics officials (See: GM open to 'car czar'; US launch of Chevrolet Spark in 2011)
Treasury secretary Timothy Geithner and White House economic advisor Lawrence Summers will oversee the task force, the official said, a day before General Motors and Chrysler are scheduled to submit restructuring plans to the government.
Ron Bloom, a United Steelworkers Union adviser and former Lazard Ltd vice president, will join administration members on the team.
Representatives from cabinet departments and White House offices will serve on the presidential task force on autos along with Bloom, who was described by administration officials as an expert in restructuring who also has experience in manufacturing and in working with unions. While there was no immediate explanation why the idea was abandoned, Obama's approach will leave the auto industry overhaul in the hands of his closest economic advisers.
The task force puts an end to reports Obama would recruit a well-known figure from outside to serve as the so-called car czar. The president was under pressure to say who would handle the issue before tomorrow, when General Motors Corp and Chrysler LLC must give progress reports on plans to restructure as a condition of $17.4 billion in US treasury loans.
GM and Chrysler are required to submit extensive restructuring plans by 17 February to the government, after they accepted bailout money late last year.
The official said the White House expected the car firms to show immediate progress towards restructuring goals from Tuesday onwards. The final plan that will serve as a basis for the treasury's decision to call in or extend the loans is due by 31 March.
The administration will analyse the restructuring plans over the next few weeks and work through them with the car giants. Negotiations on union backing for the restructuring at GM collapsed over the weekend after the UAW reportedly balked at management's plans to reform pensions for retired workers.
GM welcomed the creation of the new panel, saying, "We expect to meet soon with this team to share GM's detailed restructuring plan to restore our company to viability and to meet the requirements of its loan agreements."
Bloom, who will be a senior adviser at the Treasury, has experience with an issue at the heart of the restructuring - health-care costs. Bloom helped negotiate the Goodyear Tire & Rubber Co health-care fund, union spokesman Wayne Ranick has said. In 2005, Bloom met with UAW officials who were then evaluating GM's request for health-care concessions.
Bloom also counselled airline pilots in the $4.9 billion employee buyout of UAL Corp, parent of United Airlines. That 1994 deal included wage and work-rule concessions in exchange for 55 per cent of the company.