The federal government is considering whether or not to grant financial aid to the nation’s automobile manufacturers, according to a recent article posted on CNN Money.com. While the recently passed $700 billion federal bailout package was initially designed to get banks and securities firms to start loaning money to businesses and consumers, automakers such General Motors, Ford and Chrysler could also be eligible for this aid through their finance arms (GMAC, etc.).

These financing arms generate more profits for automakers than selling cars, says an article in the Washington Post (free registration required). With the way the credit market is all but frozen, it is difficult for individuals to get loans to buy cars and for dealers to finance their inventory. The Post article says this economic impact makes automakers just as important as banks. Unlike banks, the federal government would not provide investment capital in exchange for ownership shares. The article says the one way the government could aid automakers is to buy troubled loans from them, similar to what is being done with many banks.

NADA Retirement Administrators, Inc. (NADART) has been providing retirement plans to those in the automobile industry for over 50 years. We are, of course, very supportive of efforts to financially assist automakers such as General Motors, Ford and Chrysler during this time of financial difficulty. We look forward to doing our own part — continuing to provide employers and employees quality retirement plans at a low cost. To sponsor a NADART plan, you can contact one of our representatives at (800) 462-3278, ext. 7161 or by e-mail at nadart401k@nada.org.