General Motors has agreed to expand its bail-out of Delphi, its biggest parts supplier, by boosting the value of its financial support from $6bn to $10.6bn and implementing the aid package sooner than planned.

Delphi has been in bankruptcy protection for the past three years and struggled to finalise a restructuring since a group of private equity investors withdrew in April. The parts maker’s problems have become a millstone for GM, its former parent, which is itself battling to staunch huge losses and dwindling cash reserves.