The chairman of the Senate committee deciding whether to rescue the Detroit Three carmakers has said the health of the entire US economy is at stake.
General Motors boss Rick Wagoner and his Ford counterpart Alan Mulally have admitted making mistakes in the way that they have run their businesses.
Democrat Christopher Dodd said that letting Chrysler, General Motors or Ford fail would be playing "Russian roulette with the entire economy".
They were in Washington with Chrysler boss Bob Nardelli, and were explaining to a Senate committee why they wanted$34bn (£23bn; 26.6bn euros) in aid.
Failure would affect "almost every sector of the economy", he said.
All three also blamed the US recession for decimating sales and leaving their companies in desperate need of cash.
He also severely criticised the US Treasury and financial institutions for their handling of the credit crisis.
But senators raised doubts about whether the money would be enough.
"This is not about acting to save individual companies. If it were, I would let them fail," said Sen Dodd, who chairs the Senate Banking Committee.
"We are here today because we made mistakes, and because circumstances beyond our control pushed us to the brink," said Mr Wagoner, referring to the global economic downturn.
With "hundreds of billions in outstanding debt obligations", he said the credit crisis would get a lot worse if the carmakers were not able to repay their debts.
Mr Nardelli said that Chysler had lost $16bn of revenue as a result of plunging car sales this year alone.
Inaction, he said, "is simply not a solution."
Democrat Christopher Dodd warns that 'inaction is no solution'
Rounding off his opening salvo, the senator said the US was mired in a deep recession caused by "irresponsible actions in the financial sector", before criticising the Treasury Department for "misusing" its authority by spending the $700bn bail-out package agreed by Congress in an "ad hoc manner".
Mr Mulally admitted that Ford had "produced more vehicles than our customers wanted, then slashed prices".
We're here today because we made mistakes Rick Wagoner, General Motors chief executive
Wider implications
The authorities had not, he said, attached stringent enough conditions to the package.
In his opening comments, chairman of the Senate Banking Committee, Democrat Christopher Dodd, laid bare the severity of the situation.
The same mistakes must not be made with the carmakers, he urged.
Letting Chrysler, General Motors or Ford fail would be like playing "Russian roulette with the entire economy", he said.
The committee should determine the answers to three questions during Thursday's session, Mr Dodd said:
Failure would affect "almost every sector of the economy", he added.
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Are
the carmakers in "dire straits"?
If
they fail, what are the consequences for the wider economy?
And
if the consequences are severe, does the government have the responsibility to help?
Mark Zandi, economist with Moody's, also testifying to the committee as an independent expert, said bankruptcy at this time would be "cataclysmic" for the US economy.
All three bosses were heavily criticised after their last hearing in Congress, which was largely overshadowed by the fact that all three used separate private jets to fly to Washington.
But he threw a spanner into the works by telling the committee that $34bn would not be enough to save the carmakers.
This time, GM chief executive Rick Wagoner and his counterpart at Ford, Alan Mulally, drove to Detroit in hybrid cars produced by their own respective firms.
They might need as much as $75bn to $125bn, he said.
Mr Wagoner admitted in a prepared testimony: "We're here today because we made mistakes."
This sparked concerns that the so-called Detroit Three would simply return to Washington, cap in hand, when the money ran out.
All three bosses said their requests were realistic and based on conservative sales estimates.
Hard sell
The car company bosses said that their plan would also focus heavily on boosting investments in more fuel-efficient, environmentally friendly cars.
US policymakers have already approved $25bn in cash handouts to the car companies to help them develop greener vehicles.
All three of the bosses were at pains to explain how they had driven to the hearing in hybrid cars made by their respective companies. They had been heavily criticised two weeks ago for flying to Washington in separate private jets for their last hearing in Congress.
Some progress was made when senators floated the idea of a board to oversee the handling of any potential loans. This would impose strict conditions and could lead to fund being withheld should the conditions not be met.
All three chief executives agreed in principle to defer to such a board.
Loan proposals
Loan proposals
Earlier this week, Chrysler, Ford and General Motors submitted their proposals to Congress for multi-billion-dollar loans upon which their survival could depend.
Earlier this week, Chrysler, Ford and General Motors submitted their proposals to Congress for the multi-billion-dollar loans upon which their survival could depend.
The price tag has jumped from $25bn to $35bn in just two weeks. Why? Richard Shelby, Republican senator
Slashing costs, reducing levels of debt and investing in greener technologies form the centre-piece of each proposal.
Slashing costs, reducing levels of debt and investing in greener technologies form the centre-piece of each proposal.
The chief executives of Ford and GM have even offered to work for $1 a year if Congress approves the emergency aid.
The chief executives of Ford and GM even offered to work for $1 a year if Congress approves the emergency aid.
The so-called Detroit Three of troubled US carmakers have asked for a combined total of $34bn (£22.8bn; 26.8bn euros).
General Motors asked Congress for a loan of $12bn, with an additional $6bn if necessary, to help it survive.
Ford requested a $9bn bridging loan, which it hopes it will not need.
Chrysler sought $7bn to survive the dramatic slump in sales that has decimated its cash reserves.
At the last hearing two weeks ago, they asked for $25bn.
Republican senator Richard Shelby questioned the big rise in the amounts being asked for.
He also queried the "optimistic sales forecasts" on which the carmakers had based their timescales for repaying the loans.
Avoiding criticism
GM has warned it could run out of cash in a matter of weeks and cannot wait until President-elect Barack Obama - who may be more sympathetic to industry pleas - takes office in in January.
But Republican critics and some Democrats say the financial crisis is not the only reason why the biggest US carmakers are in trouble.
They say that Ford, GM and Chrysler's production is inefficient, and that their labour costs are higher than many of their foreign rivals.
The Bush administration has offered to accelerate the payment of some $25bn in green investment credits already allocated to the car industry, but this has been opposed by Democrats in the House of Representatives.
