Chrysler admits it's dead-in-water

[Saddle Bronc 124]

http://news.bbc.co.uk/2/hi/business/8027109.stm

Chrysler will file for bankruptcy in New York

Chrysler will file for bankruptcy

US carmaker Chrysler will file for Chapter 11 bankruptcy protection, President Obama has confirmed.

The White House said it had "worked very hard to avoid this", but not all of Chrysler's lenders were willing to participate in the deal.

The White House described the move as a "surgical short bankruptcy" which should last between 30 and 60 days.

President Obama confirmed that Chrysler and Fiat have formed a partnership, after being given 30 days to do so.

The number of Chrysler dealers will decrease over time, but no jobs will be lost in the short term, it said.

The bankruptcy will be filed in New York.

President Obama said the "necessary steps" had been taken to give Chrysler "a new lease of life".

He added that he had "every hope" that Chrysler will become "stronger and more competitive".

'Hedge fund block'

The US government had told Chrysler it would be given a further $6bn (£4bn) of vital state loans if it had successfully restructured the business by midnight.

This included trying to persuade the firm's main lenders to accept $2bn in cash, in exchange for writing off all of Chrysler's $6.9bn secured debt.

While Chrysler's main banks, holding 70% of the debt, accepted this proposal, it was reportedly rejected by hedge funds that hold a sizeable proportion of its remaining debt. Hedge funds are private investment funds that typically attract rich private investors.

The White House official accused the hedge funds of a "failure to act in either their own economic interest or the national interest".

He added that their rejection of the deal would not impede "the new opportunity Chrysler now has to restructure and emerge stronger going forward".

US Chapter 11 bankruptcy protection gives a US firm time to rearrange its finances under a court-supervised procedure, while continuing to trade, protected from its creditors.

Chrysler is owned by private equity firm Cerberus Capital Management, which bought an 80.1% stake from Germany's Daimler for 7.4bn euros ($9.9bn; £6.6bn) in 2007.

Fiat talks

Last month the US government gave Chrysler three key restructuring demands.

In addition to lenders writing off the carmaker's debts, it was asked to secure a cost-cutting deal with its main union, and establish an alliance with Italian car firm Fiat.

While Chrysler appears to have failed to reach agreement with its lenders, it has gained an agreement with the union, and has formed an alliance with Fiat.

Details are yet to be revealed but Fiat was seeking an initial 20% stake in Chrysler, which would then rise to 35% and could even reach 51%.

The Italian firm will not have to pay anything for the share, which will give it access to the North American marketplace.

In return, Chrysler will be able to take advantage of Fiat's expertise in making smaller, more fuel efficient cars.

Sector-wide woes

Chrysler, the smallest of the US "Big Three" carmakers after General Motors (GM) and Ford, secured a $4bn loan from the US government at the start of the year, and has since gained $500m more.

GM has also received multi-billion government loans. While Ford has yet to require any money, the government has agreed to give it financial support, should it be needed.

All three firms have seen sales slump dramatically in their home market as the recession has intensified.

Bankruptcy Protection

• US bankruptcy protection is called Chapter 11
• It gives US businesses time to rearrange their finances while continuing to trade, protected from their creditors

GM has its own deadline of 1 June to restructure the business to receive additional state aid, and avoid needing bankruptcy protection.

Daimler said earlier this week that it would now be giving up its remaining 19.9% stake in Chrysler.

Under the deal, Daimler said it will also write off Chrysler's outstanding loans, and make three annual payments of $200m into the Chrysler's pension plans.

Daimler said it marked the final separation of the two firms.

The German firm bought Chrysler in 1998 for $38bn.

[Ban Hammer 14,569]

this should make many happy.

[spookyturtle 9,466]

this should make many happy.

That's my line. I'm sure all of the American auto haters here will be dancing in the streets, especially when GM follows.

[Niels Bohr 72]

this should make many happy.

That's my line. I'm sure all of the American auto haters here will be dancing in the streets, especially when GM follows.

Great post Charles!

There are other American Auto Makers who are Green unlike the big three.

[spookyturtle 9,466]

this should make many happy.

That's my line. I'm sure all of the American auto haters here will be dancing in the streets, especially when GM follows.

Great post Charles!

There are other American Auto Makers who are Green unlike the big three.

And what is their market share and production numbers? How many people's employment is dependant upon them?

[Niels Bohr 72]

this should make many happy.

That's my line. I'm sure all of the American auto haters here will be dancing in the streets, especially when GM follows.

Great post Charles!

There are other American Auto Makers who are Green unlike the big three.

And what is their market share and production numbers? How many people's employment is dependant upon them?

Good question. There is a solution. Expand the market share of these GREEN companies. The future is GREEN. When will people understand that using GAS adversely affects the prices of many goods and services. GAS goes up because demand surge, and then we'll have high oil prices for many of the necessity of life such milk (yes, oil is used to manufacture milk).

Take it up a notch. The prices of these goods and services will also decrease the amount of disposable income a low-skill factory will have due to their needs on oil. This means they have tighter budget, and will struggle.

Most people don't know any better. They would just say, "I'll just work more jobs." The sustainability of the economy also depends on how many educated people there are roaming the Earth. Working more jobs, decreasing quality of education will worsen the economy even more.

There are many reasons why green is good.

[yogib37 3]

http://news.bbc.co.uk/2/hi/business/8027109.stm

Chrysler will file for bankruptcy in New York

Chrysler will file for bankruptcy

US carmaker Chrysler will file for Chapter 11 bankruptcy protection, President Obama has confirmed.

The White House said it had "worked very hard to avoid this", but not all of Chrysler's lenders were willing to participate in the deal.

The White House described the move as a "surgical short bankruptcy" which should last between 30 and 60 days.

President Obama confirmed that Chrysler and Fiat have formed a partnership, after being given 30 days to do so.

The number of Chrysler dealers will decrease over time, but no jobs will be lost in the short term, it said.

The bankruptcy will be filed in New York.

President Obama said the "necessary steps" had been taken to give Chrysler "a new lease of life".

He added that he had "every hope" that Chrysler will become "stronger and more competitive".

'Hedge fund block'

The US government had told Chrysler it would be given a further $6bn (£4bn) of vital state loans if it had successfully restructured the business by midnight.

This included trying to persuade the firm's main lenders to accept $2bn in cash, in exchange for writing off all of Chrysler's $6.9bn secured debt.

While Chrysler's main banks, holding 70% of the debt, accepted this proposal, it was reportedly rejected by hedge funds that hold a sizeable proportion of its remaining debt. Hedge funds are private investment funds that typically attract rich private investors.

The White House official accused the hedge funds of a "failure to act in either their own economic interest or the national interest".

He added that their rejection of the deal would not impede "the new opportunity Chrysler now has to restructure and emerge stronger going forward".

US Chapter 11 bankruptcy protection gives a US firm time to rearrange its finances under a court-supervised procedure, while continuing to trade, protected from its creditors.

Chrysler is owned by private equity firm Cerberus Capital Management, which bought an 80.1% stake from Germany's Daimler for 7.4bn euros ($9.9bn; £6.6bn) in 2007.

Fiat talks

Last month the US government gave Chrysler three key restructuring demands.

In addition to lenders writing off the carmaker's debts, it was asked to secure a cost-cutting deal with its main union, and establish an alliance with Italian car firm Fiat.

While Chrysler appears to have failed to reach agreement with its lenders, it has gained an agreement with the union, and has formed an alliance with Fiat.

Details are yet to be revealed but Fiat was seeking an initial 20% stake in Chrysler, which would then rise to 35% and could even reach 51%.

The Italian firm will not have to pay anything for the share, which will give it access to the North American marketplace.

In return, Chrysler will be able to take advantage of Fiat's expertise in making smaller, more fuel efficient cars.

Sector-wide woes

Chrysler, the smallest of the US "Big Three" carmakers after General Motors (GM) and Ford, secured a $4bn loan from the US government at the start of the year, and has since gained $500m more.

GM has also received multi-billion government loans. While Ford has yet to require any money, the government has agreed to give it financial support, should it be needed.

All three firms have seen sales slump dramatically in their home market as the recession has intensified.

Bankruptcy Protection

• US bankruptcy protection is called Chapter 11
• It gives US businesses time to rearrange their finances while continuing to trade, protected from their creditors

GM has its own deadline of 1 June to restructure the business to receive additional state aid, and avoid needing bankruptcy protection.

Daimler said earlier this week that it would now be giving up its remaining 19.9% stake in Chrysler.

Under the deal, Daimler said it will also write off Chrysler's outstanding loans, and make three annual payments of $200m into the Chrysler's pension plans.

Daimler said it marked the final separation of the two firms.

The German firm bought Chrysler in 1998 for $38bn.

IS this the end of the PT CRUSIER? I hope so and I hope they fall off the face of this earth

:lol:

[spookyturtle 9,466]

this should make many happy.

That's my line. I'm sure all of the American auto haters here will be dancing in the streets, especially when GM follows.

Great post Charles!

There are other American Auto Makers who are Green unlike the big three.

And what is their market share and production numbers? How many people's employment is dependant upon them?

Good question. There is a solution. Expand the market share of these GREEN companies. The future is GREEN. When will people understand that using GAS adversely affects the prices of many goods and services. GAS goes up because demand surge, and then we'll have high oil prices for many of the necessity of life such milk (yes, oil is used to manufacture milk).

Take it up a notch. The prices of these goods and services will also decrease the amount of disposable income a low-skill factory will have due to their needs on oil. This means they have tighter budget, and will struggle.

Most people don't know any better. They would just say, "I'll just work more jobs." The sustainability of the economy also depends on how many educated people there are roaming the Earth. Working more jobs, decreasing quality of education will worsen the economy even more.

There are many reasons why green is good.

No doubt that green is good and the wave of the future. But I think the Japanese makers are way ahead on this and are set to dominate the next generation of automobiles unless something changes here quick. I was sincere in asking my questions, I wasn't trying to be a wise guy.