President Bush defended his decision to loan $17.4 billion to General Motors Corp. and Chrysler LLC in his radio address Saturday, saying it would require "meaningful" sacrifices from auto workers, dealers and suppliers.

Bush explained how automakers would have to demonstrate by March 31 that they will be viable.

"This restructuring will require meaningful concessions from all involved in the auto industry -- management, labor unions, creditors, bondholders, dealers, and suppliers," Bush said during his weekly address. "If a company fails to come up with a viable plan by March 31st, it will be required to repay its federal loans. Taken together, these conditions send a clear message to everyone involved in American automakers: The time to make the hard decisions to become viable is now -- or the only option will be bankruptcy."

Bush on Friday agreed to use the remaining funds in the first half of the $700 billion Wall Street rescue program to loan GM and Chrysler each $4 billion on Dec. 29, with GM due to receive $5.4 billion next month. If Congress agrees to open the second half of the Wall Street program, then GM would get another $4 billion on Feb. 17.

"The actions I'm taking represent a step that we all wish were not necessary," Bush said. "By giving the auto companies a chance to restructure, we will shield the American people from a harsh economic blow at a vulnerable time. And we will give American workers an opportunity to show the world once again that they can meet challenges with ingenuity and determination, and emerge stronger than before."

Bush rejected calls from many Republicans that the government loan money to the automakers only as a condition of filing for bankruptcy. But, Bush warned it they don't make wise choices they will face bankruptcy next year and said in better economic times, he would not have supported preventing the automakers from filing for bankruptcy.

"If we were to allow the free market to take its course now, it would almost certainly lead to disorderly bankruptcy and liquidation for the automakers. Under ordinary economic circumstances, I would say this is the price that failed companies must pay -- and I would not favor intervening to prevent automakers from going out of business," Bush said.

In exchange for the loans, GM and Chrysler must give the government stock warrants equal to 20 percent of the money borrowed, agree to not award bonuses to top executives and end corporate perks like corporate planes. The companies can't use government loans to pay dividends and must give the government veto power over any transaction of $100 million or more. They also must negotiate to seek concessions from bondholders and the UAW.

But the plan leaves many decisions to President-elect Barack Obama, who takes office on Jan. 20. Michigan Democrats and others are already urging Obama to soften some of the conditions, especially the sacrifices urged by the Bush Administration on autoworkers.