REPORT: Chrysler unlikely to pay back most recent $4.5 billion gov't loan
Repayment of the $4.5 billion life-line in U.S. and Canadian loans that a federal bankruptcy court allowed yesterday is "highly unlikely," according to Ron Manzo, a top company adviser. To Chrysler's bankruptcy legal team, that is not the issue. Urging the court "to let this company live," automaker attorney Corinne Ball said "the survival of Chrysler's business is at stake in these proceedings, as is the fate of hundreds of suppliers and thousands of Chrysler dealers around the country."In other related developments:
- Chrysler's salaried employees will be ordered to take a two-week unpaid furlough saving the company $21 million. Hourly workers are already on furlough.
- Incentive plans to dealers will be cut by 25 percent in May, and 50 percent in June.
- Chrysler is losing 30-40 dealerships per month. They now have fewer than 3,200.
- In papers filed last week, Chrysler expects the U.S. Treasury to forgive the $4 billion loan made in January.
- The company's biggest obstacle to making a speedy exit from bankruptcy court are the dissident creditors, holding $6.9 billion in first-lien debt.
_opt_thumbnail.jpg)
Reader Comments (Page 1 of 3)
cancercell 6:43PM (5/05/2009)
as if anyone surprised by this...
Reply
tankd0g 11:22PM (5/05/2009)
I can think of a few fanboys here that are.
Ed 6:45PM (5/05/2009)
Quick, somebody complain about socialism!
Reply
ij70 6:46PM (5/05/2009)
In socialist Russia you do not drive car companies, car companies drive you!
something like that?...
mike 8:04PM (5/05/2009)
The trouble with Socialism is that you eventually run out of other people's money
- Margaret Thatcher
Steve Rattner will bring the same expertise to the auto world that he brought to BLENDER. We are truly in the best of hands.
My advice: lock in your mortgage. buy gold and land. Obama can't print those and inflate them into worthless commodities like he is doing to corporate bonds and will soon do to the US dollar.
TANSTAAFL
Tmoguy 6:49PM (5/05/2009)
If they dont, they should liquidate.
Reply
Gary Lowe 6:51PM (5/05/2009)
Americans have seen so many "Lights At The End Of The Tunnels" they are completely blind. The Chrysler Bankruptcy will be a fiasco. Round two Chapter 7 liquidation will be a fiasco. The Fiat mirage will be a fiasco. And in the end billions of tax dollars lost for nothing. We might as well just take the money and send it to John Murtha's family
Reply
nardvark 6:58PM (5/05/2009)
So...when they ask for more money, why should we listen? They employ something like 40,000 people. That's not enough to cause a mega-disaster in the economy. All of their market share will be absorbed by Ford or another automaker. What the hell are they doing with my tax dollars? It's a dead company. Let it die. Stop giving it my money.
Reply
Jared 11:05PM (5/05/2009)
+1
TriShield 7:08PM (5/05/2009)
And to add to what you said those people are already out of their jobs and have been for months, the federal money Obama and friends have been pumping into Chrysler have done nothing but keep the vegetable's pulse. It's already brain dead.
If you think the numbers involved in this bankruptcy are staggering just wait until GM is in the same position on June 1st. It's going to be vastly worse.
The best thing would have been to let them both fail. They would either reorganize or liquidate. Ford would have picked up a good portion of their business as well as the foreign automakers. There was no reason to waste everyone's money on Chrysler or GM aside from the fact that the UAW has been a staunch sorce of Democrat votes for decades.
Reply
dorp 8:37PM (5/05/2009)
TriShield, good job showing your ignorance on the politics of the bailout. You might want to check out the date when Chrysler got its money from the government and who the president was at the time.
Toledo Guy 9:54PM (5/05/2009)
and Dorp, you may want to read the Constitution. The President doesn't make laws, Congress does. Congress takes the blame for this cluster. Run by the same party last fall and today.
Polly Prissy Pants 9:24AM (5/06/2009)
"The President doesn't make laws, Congress does."
You probably also think that only Congress can declare war because it's in the Constitution. How quaint.
jv2k 12:47PM (5/06/2009)
Why are people acting like the government came into their houses and stole their wallet? You paid just as much as you normally did and let's be real here, compared to the billions more that was given to the financial district.
Yes and before you begin whining that it could have been used to fund schools and build bridges and all that jazz, get real. The money would have been spent on the same o'l garbage it went to last year.
mapoftazifosho 7:11PM (5/05/2009)
Chrysler is so insolvent it isn't even funny. GM at least has industry leading technology, IIHS top safety pics, and vehicles that are tops in their class in regards to fuel economy.
Chrysler has none of that and the consumer knows this...Obama is an idiot if he thinks the saving of this company is something the US taxpayer wants.
Let Chrysler die so Ford and GM can pick up the slack. The consumer isn't going to wait 2-3 years for Chrysler's great new products to come to market. The fact that the company was sold in 1997 and 2007 is proof enough of Chrysler's long time insolvency.
Reply
Frank Hoffman 7:12PM (5/05/2009)
I have to commend this administration. Instead of just letting them go bankrupt, they allowed Chrysler to steal $4.5 billion from taxpayers, and then go bankrupt.
Reply
justin 7:33PM (5/05/2009)
most of this money went to union staffers, union health care & pension, not exactly the corporation.
to be more precise, this administraion indirectly allowed the unions to steal a majority share of the loans before allowing Chrysler the company to go bankrupt.
jpm100 7:52PM (5/05/2009)
And just remember, union members drink the blood of new born babies.
Mikhail V 9:33PM (5/05/2009)
Yeah, the Bush administration that gave the money back in 2008 sure are screwing us now! Oh wait, that's not the one you are talking about? You are talking about administration that was not in the White House when the money was given? I like that one, can we blame Thomas Jefferson too, since he was a president once and it's all the president's fault?
And did you read the actual bankruptcy papers to see what the government (i.e. tax payers) get as the result? Judging by your confusion between two presidents (seriously, only two and you are already confused!), I bet not.
Titolito 7:13PM (5/05/2009)
So this basically confirms that the automaker bailouts equates to tossing cash into the toilet, and watching it swirl down the drain. Great use of taxpayer money!
Reply