Updated: Chrysler to Enter Bankruptcy

Reported: Chrysler to Declare Bankruptcy Tomorrow

Update #5 April-30-2009 02:49 PDT:
Chrysler will idle most of its manufacturing plants during its bankruptcy restructuring. The move is likely to put added stress on already struggling auto suppliers. Some of the suppliers could be forced to declare bankruptcy themselves in an outward-rippling BK chain-reaction.

Chrysler dealers are also going to struggle more - particularly small and marginal ones. A bankruptcy judge assigned to the case could terminate Chrysler's dealer contracts that had been protected by business franchise laws, forcing some to close their doors.

At the end of Chrysler's bankruptcy, there are likely to be far fewer Chrysler dealers.

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Update #4 April-30-2009 09:33 PDT:
Chrysler CEO Bob Nardelli will step aside after the bankruptcy proceedings have been completed.

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Update #3 April-30-2009 09:30 PDT:
President Obama just finished speaking about Chrysler. The company will file for bankruptcy to start a court-governed restructuring that's expected to take 30 to 60 days.

The federal government will continue to stand behind Chrysler's new vehicle warranties and will provide up to an additional $8 billion in aid until Chrysler can finalize its partnership with with Fiat. GMAC has agreed to finance new Chrysler vehicle sales.

A new Fiat/Chrysler managed company will emerge from the bankruptcy proceedings.

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Update #2 April-30-2009 07:35 PDT:
There are numerous reports that negotiations between Chrysler and its creditors broke down over night. Chrysler is moving forward filing for Chapter 11 bankruptcy protection to settle its financial obligations in court. The White House is expected to make the announcement today when President Obama speaks about the government's next steps aiding Chrysler and GM.

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Update #1 April-29-2009 15:02 PDT:
The Washington Post is reporting that Chrysler CEO Bob Nardelli will be replaced by Fiat executive management under the Chapter 11 bankruptcy plan.

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Bloomberg is reporting that President Barack Obama is expected to announce tomorrow that Chrysler will enter Chapter 11 bankruptcy before signing an alliance with Italian automaker Fiat. Under the deal, Chrysler's most valuable assets would be sold to a new "entity." Fiat is expected to take a 20 percent ownership stake in Chrysler, a union retiree health-care trust fund would own 55 percent, and the rest of the company would be owned by the U.S. government.

Still no word whether the Dodge Ram 1500 will be renamed the Ram Millecinquecento.

[Source: Bloomberg, The Washington Post]

Comments

This should fix them up for the next few years, relieved of all legacy costs and in possession of competitive union contracts. I hope they survive, I like their stuff.

I think hey have the best looking vechiles on the road, I like how dodge keeps the muscle look.

What is really a shame, is that with all the concessions that the workers (and even the unions) finally agreed to, those stinkin bankers wouldn't give a bit. I hope the creditors don't get a penny out of the reorg.

may be a dumb question, but can someone tell me what this does to the dodge ram series??? are they gona still make them?

@tay: In the short term, no changes are expected for either the light or heavy-duty Rams, though Chrysler will halt production at most factories until the BK restructuring is complete.

DODGE= Don't Over Do Granny Engine HAHAHA

And all of a sudden our beloved president is an expert in the automotive industry. Typical socialist/communist putting his nose where it doesn't belong. FULL GOVERNMENT CONTROL AND DISTRIBUTED WEALTH FOR ALL!!!

If you've been listening, this bankruptcy will last about 60 days. The American attention span is so short no one will remember today. If you don't believe me just watch Jay Leno's All-Stars sometime. They don't remember 9-11 and think the war between the states was fought in the 1980's in Vietnam or ask them to pick out the US of A on a map. No one cares. The only people buying cars can buy cars or are to stupid to realize they can't afford a car.

the only reason American auto companies have a bad name is because of gm and chrysler. gm has improved true, but chrystler continues to sell the most dangerous vehicles to buy in the category. chrystler is cheap but don't get me wrong the LOOK is nice on the dodge ram, but under the hemi hood is crap that can only tow 6,500 pounds while the Ford f-150 tows 11,000-12,000 pounds.

Ford is the best and strongest enduring. hopefully they won't take any corrupt government bailout money.

but for the time being i don't care about chrystler and i can say my Ford is built so tough it doesn't need a corrupt government auto bailout.

-God Bless

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For those consumers concerned about buying a car from a bankrupt automaker, the president promised that Chrysler warranties would be fully backed by US government



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