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US Congress 'close to car bail-out'

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A bail-out package from the United States' Congress for America's failing car industry could be finished by the end of Wednesday, the Senate majority leader has said.

A final agreement with the White House on moves to help Detroit's Big Three rests on just a couple of outstanding issues, said Harry Reid.

After General Motors and Chrysler admitted they were struggling to survive, the two carmakers along with Ford tried to convince members of Congress to vote for the bail-out.

The three firms asked the government for a package worth $34 billion (£22.9 billion), however reports suggest the final amount will be about $15 billion (£10.1 billion).

The package will provide loans to carmakers and place a newly appointed "car czar" in charge of overseeing an industry overhaul.

According to a congressional aide, the plan will use an existing loan programme, in place to help firms build fuel-efficient cars, to provide emergency cash.

The carmakers will have to impose limits on top executives' pay, give the government a slice of future profits and guarantee that taxpayers will be repaid before shareholders.

© Press Association 2008