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Definition: Auto Supplier Support Program
In 2008-09 when the crisis hit the auto industry, this caused a declined in the sales and effected the operation of these companies. This caused credit crisis and the suppliers were unable to get credit facility and their business faced uncertainty. Under these circumstances, the suppliers were reluctant to extend credit to the auto maker’s causing a potential halt in their operation.
Obama government introduced the Auto Supplier Support Program (Auto Ssp) to help these suppliers and provide these firms adequate time to restructure their operations and helped them to access loans and pay their employees and continue with their daily operations. This program guaranteed the suppliers that the money lend by them will be repaid under circumstance. The U.S. Treasury department funded this program ($ 5billion).
Auto makers make a financial commitment to the U.S. Treasury to avail the benefits of this program. General Motors and Chrysler have participated in this program. Under this program, for a modest fee the suppliers get support of the government funds and in turn have to sell the parts for a modest discount to the Auto makers.