DETROIT -- Major credit rating agencies and Wall Street analysts -- fearing shareholders and other stakeholders could be wiped out -- downgraded the outlook for Detroit's troubled automakers on Monday, after digesting the federal government's emergency loan package to rescue General Motors Corp. and Chrysler LLC.

On the first Wall Street trading day since the White House said GM and Chrysler would get $17.4 billion in emergency federal loans, analysts warned a bankruptcy filing remains a risk and that GM shareholders could be left with worthless shares following broad restructuring efforts.

GM shares tumbled almost 22 percent to $3.52, down $0.97, underscoring investor concerns that the strings attached to the loans could devastate shareholders.

Credit Suisse analyst Christopher Ceraso dropped his price target for GM shares to $1 from $2.

"Over the next two months, as bondholders, union representatives, and company management meet to hammer out concessions, we think it will become increasingly clear that the enormous sacrifice of value on the part of the union and bondholders will require the complete or near-complete elimination of the existing GM equity," Ceraso wrote in a research note.

The market and analyst reaction came three days after President Bush agreed to loan the automakers $17.4 billion to avoid an immediate collapse. In exchange, each company must submit a plan by February to win financial relief from employees, creditors, and other stakeholders that will make each company viable. GM has also indicated it will trim brands, model lines and dealerships to aid its turnaround.

In exchange for the loans, GM and Chrysler must give the government stock warrants equal to 20 percent of the money borrowed, agree not to award bonuses to top executives and end corporate perks such as planes. The companies can't use the government loans to pay dividends and must give the government veto power over any transaction of $100 million or more. They are expected to begin negotiations over concessions with bondholders and the UAW next month, though some high-levels talks will occur sooner.

The Bush administration set ambitious restructuring targets as part of the aid package, but didn't lay out requirements.

The targets include reducing debt by two-thirds via a debt for equity exchange, requiring the UAW to accept half of the health care trust fund payments payable to the union from the automakers in 2010 in the form of stock rather than cash, and new factory work rules and wages that are competitive with foreign automakers by the end of 2009. Unlike an earlier package proposed by Senate Republicans, the White House did not make those targets binding.

The three-year loan can be automatically rescinded by March 31 if automakers have not complied with specific conditions.

The loans do not eliminate the bankruptcy risks facing Detroit's Big Three automakers, auto analyst Himanshu Patel of JPMorgan wrote in a research note Monday. He believes Bush and President-elect Barack Obama would work to prevent a Chapter 7 bankruptcy filing by GM and Ford, but that a Chapter 11 reorganization of GM "should not be dismissed," Patel wrote.

Standard & Poor's Corp. said there is still a sizable risk that Chrysler will file for bankruptcy protection, underscoring the agency's decision to downgrade the automaker's corporate credit rating to CC from CCC+ on Monday. S&P also lowered the ratings on the automaker's senior secured debt and listed the outlook as negative.

A CC rating is given when a company is expected to undertake a distressed exchange of its debt, said Robert Schulz, the credit analyst behind the report, noting S&P downgraded GM on Dec. 4 for the same reason.

"Our preliminary expectation is that, even with substantial government support that enables Chrysler to avoid a bankruptcy filing, the corporate credit rating would likely not rise out of the CCC category immediately following the consummation of a debt exchange because of the various challenges the company faces, which we believe will keep bankruptcy risk high," Schulz said.

Ford Motor Co.'s rating was lowered Monday by Moody's Investors Service, which also listed the outlook as negative. The moves reflect the increased risk Ford will need to restructure its balance sheet to achieve the same UAW concessions as GM and Chrysler.

Tight credit markets, a weak economy, climbing unemployment and the housing crisis have drastically curbed consumer demand for new cars and trucks, posing a major hurdle for every major automaker.

Meanwhile on Monday, the National Automobile Dealers Association hailed a decision by the Federal Reserve Board that allows new car and truck dealers to tap a new $200 billion loan program to pay for inventory.

The move is intended to stimulate small business and consumer lending, which has dried up in the wake of the credit crisis. Most dealers finance their inventory -- a process called floorplanning -- through automakers or banks.

Last week, Suzuki Motor Co. warned dealers it was forced to abandon attempts to find a source of wholesale financing for its dealerships.

"NADA's goal all along was to restore liquidity in the credit markets for all dealers and their customers," said Andy Koblenz, the association's vice president of legal and regulatory affairs. The Federal Reserve Board's move will "ensure that dealers have at their dealerships the selection of vehicles that consumers want to buy," he added.