BofA CEO: ‘One too many’ Detroit Three automakers

“I think there’s one too many” automakers, Bank of America CEO Kenneth Lewis told the Detroit Economic Club during a meeting in Cobo Center, the downtown convention center that’s home to the North American International Auto Show each January. He added he would require consolidation if he was deciding on a bailout.

“I think the American people are suspect of just giving more money and buying more time,” he told reporters after the speech. “They want to see that the companies have in fact changed and the strategies have changed.”

Treasury Secretary Henry Paulson told Congress earlier in the day the administration remains firmly opposed to dipping into the government’s US$700 billion financial rescue package on behalf of General Motors Corp., Ford Motor Co. and Chrysler LLC. He said “there are other ways” to help them.

Auto executives, appealing to the Senate Banking Committee on Tuesday, insist they need US$25 billion in emergency bridge loans to avert a collapse of one or more of their companies.

Charlotte, North Carolina-based Bank of America has received its US$25 billion in government funds as part of the bailout effort envisioned to rescue the financial system. Nine large banks, including Bank of America Corp., Wells Fargo & Co., Citigroup Inc. and JPMorgan Chase & Co., received US$125 billion last month.

Lewis said Bank of America’s was “invited” by the Treasury Department to take its share — US$15 billion for the bank and US$10 billion for Merrill Lynch, which Bank of America has acquired — to stimulate the market by providing more loans. The bank is committed to that goal, he said.

Despite the losses those in the automotive industry would suffer in the short term, Lewis said consolidation should be seen as positive in the long term.

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