Washington  - US President Barack Obama on Tuesday backed the plans of General Motors and Chrysler to compete after emerging from bankruptcy in the last few weeks.

In a visit to Michigan, the state at the heart of the US auto industry, Obama praised both companies for getting out of the bankruptcy process "in record time," though with the help of billions of dollars in government loans.

"They've got a leaner structure, they've got new management, and a viable vision of how to compete and win in the 21st century," Obama said in a speech in the town of Warren.

They were his first comments since GM exited bankruptcy Friday, 40 days after it sought court protection from creditors. The US Treasury has a 60-per-cent stake in the "new" GM in exchange for handing over up to 50 billion dollars in emergency loans to keep the Detroit-based company afloat. Canada's government has a 12-per-cent stake.

The Obama administration also took a minority stake in Chrysler, which left bankruptcy in mid-June under the control of Italian carmaker Fiat. Critics have accused Obama of plugging too much money and taking too active a role in the rescue of both firms.

Both companies have been forced to shed thousands of jobs, lower salaries and benefits, close dozens of plants and end contracts with hundreds of dealerships, in an effort to survive the deep US recession and compete with cheaper foreign rivals that have been stealing market share for decades.

GM and Chrysler had gone through a "painful period of soul- searching and sacrifice," Obama said. "And together, they've made the rebirth of Chrysler and GM possible." (dpa)