President Obama forced Chrysler into federal bankruptcy protection on Thursday so it could form an alliance with Italian carmaker Fiat. Chrysler hopes to sell its core assets–including the Chrysler, Jeep and Dodge brands–into a new company that would be owned by the US government, Fiat, and the company’s workers.
With Thursday’s filing, Chrysler became the first major American automaker to seek bankruptcy protection since Studebaker did so in 1933.
The arrangement came after an intensive round of White House-sponsored negotiations among the Treasury Department, the union and Chrysler’s executives and creditors.
Speaking from the White House, President Obama said the partnership will save 30,000 jobs at Chrysler but criticized the role of some hedge funds as “speculators” who pushed the automaker into bankruptcy.
Chrysler now moves into U.S. Bankruptcy Court which must approve the deal. But a group of about 20 Chrysler lenders are set to challenge the bankruptcy filing. They do not agree with the plan to cut Chrysler"s $6.9 billion dollars in debt and say that selling off Chrysler assets within 60 days infringes on their legal rights.
Ralph Nader is a longtime consumer advocate, corporate critic and former presidential candidate. His first book, “Unsafe at Any Speed: The Designed-In Dangers of the American Automobile,” published in 1965, took on General Motors and its Chevrolet Corvair model. He joins us on the telephone from Washington DC.
Ralph Nader, longtime consumer advocate, corporate critic and former presidential candidate. His first book, “Unsafe at Any Speed: The Designed-In Dangers of the American Automobile,” published in 1965, took on General Motors and its Chevrolet Corvair model.
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