The concessions could go beyond the requirements imposed by the Bush administration when it agreed to loan the automakers money last year, said the person, who asked not to be identified because the government's plans have not been revealed.
President Barack Obama will announce the administration's plan for the auto industry on Monday. White House press secretary Robert Gibbs said Obama's auto task force was "winding down the decisions that have to be made" and finalizing the plan.
Both automakers are operating on a total of $17.4 billion in government loans, trying to weather the worst auto sales downturn in 27 years. In addition, GM is seeking another $16.6 billion, while Chrysler wants $5 billion more.
General Motors Chief Executive Rick Wagoner met with members of the task force on Friday, an Obama administration official said.
The term sheets that came with the first loans require extensive restructuring, including executive pay cuts and labor costs that match Japanese automakers. Both companies also must persuade the United Auto Workers to take equity in exchange for half of the payments the companies must make to union-run trust funds that will take over retiree health care costs starting next year. And they must get debtholders to swap equity for two-thirds of the companies' debt.
"There may be more extensive conditions than were laid out initially in the term sheets," the person said.
Both companies face a Tuesday deadline to turn in finished restructuring plans to the government, but neither company is likely to have everything done. Neither GM nor Chrysler have deals with the union on the trust funding or concessions from their debtholders, although talks are continuing.
"Our union is continuing to work with the task force and the auto companies to find a solution to the may issues we face," UAW President Ron Gettelfinger said Friday through a spokeswoman.
The companies are likely to get short-term loans and an extension of time to reach agreements with debtholders and the union. The loans are likely to come with tight deadlines.
Obama made clear Thursday that the companies would face having to make tough concessions for additional aid, but it was unclear if that meant concessions beyond the initial loan terms.
The president said if the companies were "not willing to make the changes and the restructurings that are necessary, then I'm not willing to have taxpayer money chase after bad money."
Republicans were signaling their opposition to Obama's approach.
