The Obama administration's auto task force has appointed Matthew Feldman, an eminent bankruptcy attorney from the bankruptcy and restructuring firm, Willkie Farr & Gallagher to join them and advise the team on reorganising the automobile industry.

Feldman has been selected to join the auto team at the treasury department advising treasury secretary Timothy F. Geithner and Lawrence H. Summers, the director of the National Economic Council, on reorganisation efforts by the automobile manufacturers and their suppliers.

Feldman is one of the country's preeminent bankruptcy attorneys and he will leave the firm by the end of March to start in his new position in Washington and join with the other consulting bankruptcy and restructuring law firms Cadwalader Wickersham & Taft LLP and Sonnenschein Nath & Rosenthal, who had been appointed earlier by the task force team.

The auto task force team said that by hiring Feldman, the forces team will not alter its approach in restructuring the auto industry as his expertise will be required to analyze restructuring options along with the output of other team members.

Ailing Detroit automakers, General Motors Corporation and Chrysler received $13.4 billion and $4 billion respectively from the US government in January in order to save them from an imminent collapse. (See: General Motors gets $4 billion US government loan, Chrysler still in talks / Chrysler receives $4 billion from US treasury)

The loans were given to Chrysler and GM subject to both submitting restructuring plans to the government by mid-February and demonstrate that they are viable by end-March and able to repay the loans.

In mid-February, both the automakers lodged viability plans with the US Treasury Department, which involved massive layoffs and discontinuation of brands. They warned that the downturn in the US was more severe than they had predicted in December, when they first received government funds.

But both of them asked the Obama administration for an additional $22 billion - nearly double their original estimate – just to stay afloat beyond next month. The two companies have already received $17.4 billion in government handouts. (See: GM, Chrysler demand $22 billion more; to slash jobs, production lines)

GM, which has already received $13.4 billion, said it will close five more plants in the US and pare its workforce by 20,000 out of 92,000 currently employed in America, while shedding another 27,000 workers in other countries.

It has also put the Hummer and Saab brands on the market and plans to phase out its Saturn brand, while Pontiac will be integrated into the Chevy-GMC line-up.

Chrysler said it will cut 3,000 more jobs while also cutting out models and president and vice-chairman Jim Press said last month that the company would eliminate the Chrysler Aspen, Dodge Durango and Chrysler PT Cruiser.

Both have also been able to achieve considerable amount of concessions from United Auto Workers union and were able to modify the existing labour contracts, where GM was able to cuts hourly costs to below those paid by foreign automakers in the US and Chrysler was able to make changes in the labour contract, where it will save it $500 million annually.

This week, GM said that it would not require its next installment of government aid as quickly as initially expected.