The Original Equipment Suppliers Association said today it has hired an advisory team led by former auto analyst Scott Merlis to help with proposals for government loans.
Merlis, who worked 26 years as an auto analyst, is heading the team from Ducker Worldwide LLC, of suburban Detroit. The firm, which began working with the association four weeks ago, advises suppliers on balance sheet recapitalization and mergers and acquisitions.
Last week, the association sent a working document to the U.S. Treasury Department explaining that suppliers need federal loans to survive production levels corresponding to the lowest U.S. sales rate in 26 years. The document suggested $20.5 billion in loans: $10 billion in direct funds and $10.5 billion to the Detroit 3 that would allow the automakers to pay suppliers in 10 days for parts delivered instead of the traditional 45.
The federal government already has pledged $24.9 billion to General Motors, Chrysler LLC and their captive finance companies; earmarked $25 billion for supplier and automaker plant retooling; and committed funding to free up credit for consumer loans, including those to vehicle buyers.
David Barkholz and Robert Sherefkin contributed to this report