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Restructure fast or go bust.

That was the blunt message U.S. President George W. Bush delivered to General Motors Corp. and Chrysler LLC Friday as he grudgingly approved $17.4-billion (U.S.) in emergency bridge loans for the cash-starved car makers.

Even with the infusion, many experts said one or both of the companies may still be forced into bankruptcy protection after March 31, 2009, when Washington can call the loans.

And analysts said Chrysler, the smallest of the Detroit Three, may not survive as an independent car maker.

The contrast between the prospects of GM and Chrysler were on display Friday. A thankful Rick Wagoner, GM chief executive officer, met with reporters in front of gleaming new car models at the company's headquarters in Detroit, insisting he's “highly confident” GM can meet the government's financial viability test outside of bankruptcy.

Chrysler chief executive officer Robert Nardelli, on the other hand, kept a low profile, issuing an open letter in which he appealed for help from dealers, suppliers, creditors and workers to cut costs and regain profitability.

Many experts remain unconvinced.

“It's unlikely that we'll see Chrysler as a viable long-term player,” said Susan Helper, an economist and auto industry expert at Case Western University in Cleveland.

Chrysler owner Cerberus Capital Management LP, which has been trying desperately to unload the auto maker, will have some tough decisions to make come March, when it will have to prove its viability to federal authorities.

With Mr. Bush now just a month from leaving office, deciding the fate of the industry will soon fall to the incoming president, Barack Obama. Mr. Obama and other Democrats are already grumbling about the condition that wages and benefits must be cut to match what Japanese auto makers pay their U.S. workers.

It will be up to the Obama administration to determine whether GM and Chrysler's business plans meet the tough conditions set out in the loans.

Speaking to reporters in Chicago, Mr. Obama urged GM and Chrysler to “seize on the opportunity” to come up with a sustainable business plan by March. And he warned the companies not to force hourly workers to bear the brunt of the pain.

Analysts said the loan package is merely a bridge that buys some time for the auto makers, but does little to address the companies' longer-term problems, including high wages, dwindling market share and too many assembly plants.

“This is just a small first step,” said economist Sean Maher of Moody's Economy.com, adding that the government may face an eventual price tag of $75-billion to $125-billion.

“Even if the government is unwilling to go that far, the announcement will prevent an immediate blow to the fragile economy, and also give the auto makers time to plan an orderly restructuring – in or out of bankruptcy,” Mr. Maher said.

The loans are less than half of the nearly $60-billion the industry has said it needs to survive, auto analysts Aaron Bragman and Rebecca Lindland of IHS Global Insight pointed out in a research report.

“This is a Band-Aid for the auto industry, the amount of money being loaned to the auto makers is insufficient,” Mr. Bragman and Ms. Lindland said. “All auto makers, including Ford [Motor Co.], are going to need government money.”

The success of the bailout hinges on what Mr. Bush called “meaningful concessions” by all players, including conversion of two-thirds of bondholder debt into equity and compensation parity with Japanese auto makers for unionized workers. Analysts estimated that U.S. workers could face hourly wage and benefit cuts of $10 to $15 an hour.

Mr. Bush acknowledged that the spectre of bankruptcy still hangs over the two companies, pointing out that he only agreed to the bailout because the recession-battered economy couldn't take another jobs hit “at this time.” (The White House estimated the price of bankruptcy at 1.1 million jobs and 1 per cent of gross domestic product.) “Under ordinary circumstances, I would say [bankruptcy] is the price that failed companies must pay,” Mr. Bush said at the White House. “But these are not ordinary circumstances.”

The Bush administration said $13.4-billion of the money would be available this month and next – $9.4-billion for GM and $4-billion for Chrysler – from a $700-billion bank bailout fund. GM would get another $4-billion in loans after Congress releases the second half of the fund.