Bloomberg is reporting that President Obama will announce Chapter 11 bankruptcy for Chrysler tomorrow morning. The move is designed to facilitate a merger with Fiat which would own 20% of the new company while the UAW would own 55%.
Update: The Washington Post is now reporting that Chrysler CEO Bob Nardelli will be replaced by Fiat management as part of the bankruptcy plan currently being developed by the Obama administration. Fiat would eventually own 35% of the new company while the U.S. government would 8% and the Canadian government 2%. Cerbereus Capital would no longer have a stake.
Bloomberg: Obama Said to Plan for Chrysler Bankruptcy, Alliance
Wash Post: Chrysler Bankruptcy Plan Would Oust CEO, Install Fiat Management
jederino says:
02:28 PM, 04/29/09
It's interesting the UAW would own 55%. I don't have heartburn with that since they are the most vulnerable, with personal retirement on the line. It's an interesting dilemma, considering the UAW is responsible for the financial straits to some degree. You would think a union would have had some influence to improve quality and reliability. Does anyone have insight as to where most quality-related problems with Chrysler surfaced? Final assembly (UAW), subcontracted parts suppliers, or engineering design?
bankerdanny says:
02:49 PM, 04/29/09
This should be interesting.
The UAW will never be able to think like an employer where higher wages have to be balanced by the profits to pay for them. They will only ever see things from the employee perspective where you want higher wages and benefits and it is the company's job to figure out how to pay for them.
Do you think that the if management refused to give raises that the UAW members will set up a picket line outside the Union Local office?
billt9 says:
03:15 PM, 04/29/09
it's great the people own the company now.
that's the way it should be
now the company doesn't have to fight the people, and the people will know everything from the inside.
now the people will know there's no hidden stash of green somewhere.
the people will also work harder, now that they see their effort on the the job is directly tied to the income they take home.
sucks to take responsibility, the people. now you got the company, and the responsibility. you are both manager and employee.
What will your brain do? Explode? Or work harder?
billt9 says:
03:47 PM, 04/29/09
jederino:
parts can be designed so that they take very low intelligence to fit together perfectly.
For example, plastic model kits that require model cement, versus Japanese snap tight model kits (Like a Bandai Perfect Grade Eva kind of thing). A Perfect Grade kit is very intricate, and can still be assembled virtually flawlessly by any dumbass worker.
The idea is engineering and production need to communicate. The engineers need to be aware of the capabilities of the production plant (including the human workers), and design the parts so that they fit together perfectly, within the capabilities of the production plant.
You may blame one of the parts, or you may blame an overall system failure. Or both.
Or just each department blames each other and not themselves and be a big dysfunctional family.
brn says:
04:10 PM, 04/29/09
Somebody explain to me what Fiat is really bringing to the table. I'm concerned that they're just trying to save their own but and want to use Chrysler resources to do it.
kingkhalas says:
04:11 PM, 04/29/09
why would Fiat want to get in a deal with the UAW?
Fiat shouldn't agree to this.
jederino says:
04:48 PM, 04/29/09
Fiat doesn't seem to risk anything, except the investment to bring some of their cars over, and train dealerships to maintain them. All Fiat has to offer in the bargain is some vehicle platforms for Chrysler to use.
estreka says:
06:38 PM, 04/29/09
No amount of sales is worth entering an agreement with the Devil, er, UAW.