It's now official. President Obama announced this morning that Chrysler has entered into bankruptcy proceedings.
His remarks revealed little in the way of new information, but Obama did go out of his way to call out the private equity groups that stood in the way of a reorganization out of bankruptcy. "I don't stand with them," he said.
Obama went on to say that the bankruptcy "will be quick and efficient," a promise that will be tough to deliver. He also suggested that Americans who are in the market for a new car should "buy American."
Also worthy of note, GMAC (formerly known as the General Motors Acceptance Corporation) will take over the retail financing of Chrysler vehicles.
Bloomberg: Obama Says Chrysler Getting "New Lease on Life"
flicmod says:
12:07 PM, 04/30/09
Am I the only one that thinks it's fishy that GMAC is involved in this now?
estreka says:
01:02 PM, 04/30/09
GM is only 2 steps behind. Bondholders made a counteroffer today that GM will be hard pressed to accept. Additionally, it appears GM needs 90% of bondholder to agree to terms in order for any debt-to-equity deal to be reached. GM will never get a hold of 90% of their debtors.
As far as Chrysler is concerned, well, it's over. We've known that it was over several months ago. To be fair, back in October I thought they were going to throw in the towel sometime in March. I'm surprised they exceeded my prediction by a whole month.
minibro77 says:
01:21 PM, 04/30/09
No since they are both owned by Cerberus. By the way Chrysler is not done. This will work out for them. As long as Fiat gets their ass in gear and gets their product in their mix. They'll be fine.
firstwagon says:
02:45 PM, 04/30/09
"As far as Chrysler is concerned, well, it's over."
Not at all. That's not how bankruptcy works. It's actually a good thing as it will allow them to lose a lot of bad debt and get out of some bad "arrangements".
I think they have a better chance of rebounding then GM does. Not because of product (GM has better product) but because of smaller size and way less baggage.
billt9 says:
02:54 PM, 04/30/09
If the government is so involved, just make a new law to declare Chrysler bankrupcy and resolution in 7 days.
It's because of current laws that causes a 7 month long bankruptcy. Just write some new laws exclusively for Chrysler, and BAM done.
firstwagon says:
05:49 PM, 04/30/09
It's a good idea billt9 but the lawyers will never let it happen.
Bankruptcy is a huge cash cow for them. They need to stretch it out as long as possible to get the billing hours as high as possible.
fixxxer says:
01:28 AM, 05/ 1/09
When Obama says "Buy American" does he mean "Buy a Ford"?
Cause as it seems, they are the only American car company that isn't deep in the Gov't pockets...yet
estreka says:
10:28 AM, 05/ 1/09
I should expand on what I said earlier because it's being taken out of context.
When I said "it's over," I meant Chrysler as an independent automaker and a big name on the world stage. Chrysler as an AG is over.