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ETF News

UPDATE 1-Senator says more aid likely for US automakers

* More aid would include new conditions

* Task force faces March 31 deadline

* GM shares up after hours (no specifics on aid, no deal yet with bondholders)

WASHINGTON, March 25 (Reuters) - The Obama administration task force is likely to recommend more aid for struggling U.S. automakers, a senior senator said on Wednesday.

Carl Levin of Michigan told reporters that “it is clear” any assistance would be tied to new conditions on restructuring.

The task force has a March 31 deadline to determine whether General Motors Corp GM.N and Chrysler LLC can be competitive and worthy of up to $22 billion in additional bailout funds.

The two received $17.4 billion in taxpayer assistance in December.

Levin said he had no specifics on any aid plan, but optimism for helping GM and Chrysler rose last week when the task force approved $5 billion in aid for stressed industry suppliers.

GM shares fell 6 percent in regular trade on the New York Stock Exchange but rose a penny after hours to $3.

It remains unclear, however, how the task force overseen by the White House and Treasury Department would tailor a new bailout package.

Other lawmakers previously have said they were told by task force leaders that any plan would include separate recommendations for GM and Chrysler.

GM has asked for more than $16 billion in aid, while Chrysler is seeking $5 billion.

The rescue extended by the Bush administration required specific concessions on wages and retiree health care costs by the United Auto Workers, and debt reduction through GM bondholders.

While the companies have made progress on UAW givebacks, final agreements have not been struck. Additionally, there has been no deal at GM with bondholders on a proposal to swap a sizable portion of the $27 billion in debt they hold for equity. (Reporting by John Crawley; editing by Carol Bishopric)

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