he was forced out..
Government Forces Out Wagoner at GM - WSJ.com
Quote:
The Obama administration used the threat of withholding more bailout money to force out General Motors Corp. Chief Executive Rick Wagoner and administer harsh medicine to Chrysler LLC, marking one of the most dramatic government interventions in private industry since the economic crisis began last year.
The administration's auto team announced the departure of Mr. Wagoner on Sunday. In a summary of its findings, the task force added that it doesn't believe Chrysler is viable as a stand-alone company, and suggested that the best chance for success for both GM and Chrysler "may well require utilizing the bankruptcy code in a quick and surgical way."
The move also indicates that the Treasury Department intends to wade more deeply than most observers expected into the affairs of the country's largest and oldest car company.
After over a month of analysis, the administration's auto task force determined that neither company had put forward viable plans to restructure and survive. The verdict was gloomier for Chrysler. The government said it would provide Chrysler with capital for 30 days to cut a workable arrangement with Fiat SpA, the Italian auto maker that has a tentative alliance with Chrysler.
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chrysler will be forced to merge with fiat
U.S. Sees Fiat Pact as Chrysler's Best Hope - WSJ.com
Quote:
DETROIT -- Chrysler LLC has failed to make its case to the federal government that it can be viable as a stand-alone company, and may have to resort to restructuring through bankruptcy court, the Obama administration's auto industry task force concluded in a memo released late Sunday.
The best chance for Chrysler and General Motors Corp. to recover "may well require utilizing the bankruptcy code in a quick and surgical way," the task force wrote in a memo summarizing its findings on the two auto makers. A "structured bankruptcy," the panel added, "would be a tool to make it easier for General Motors and Chrysler to clear away old liabilities so they can get on a path to success."
The task force, which has been studying the auto industry since mid-February, said Chrysler's best hope for revival lies in a proposed partnership with Italy's Fiat SpA.
The administration said it is willing to provide Chrysler 30 days' worth of working capital to finalize such a partnership; only then would it consider following up with the $6 billion in loans Chrysler has requested to effect its restructuring plan. And such a restructuring would have to include more significant debt reductions and concessions than Chrysler outlined in its initial appeal for government
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feds to guaranteed gm, chrysler warranties
U.S. to Guarantee GM, Chrysler Warranties Amid Restructuring - WSJ.com
Quote:
DETROIT -- The Obama administration said it would guarantee warranties on General Motors Corp. and Chrysler LLC vehicles to help mitigate any drop in sales that could occur as they undergo the tough restructuring measures recommended by the government.
Under the program, GM, Chrysler and the government would set up a fund to cover the cost of warranty repairs if either company were to end up filing for bankruptcy protection, according to memo released Sunday night by the administration's auto task force.
The guarantee is designed to support the recovery of the companies by "mitigating consumer uncertainty that is depressing demand for new vehicles."
Consumers, the memo said, "should have confidence that if they buy new cars from either company, their warranties will be honored."
The fund that will be set up will cover 125% of the expected cost of future warranty repairs to ensure enough money is available for all repair claims. GM and Chrysler will contribute 15% of the amount required in cash, with government loans providing the rest.
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chryslers viability statement
http://online.wsj.com/public/resourc...nt20090330.pdf
GMs viability statement
http://online.wsj.com/public/resourc...t-20090330.pdf
the obama "new path to viability"
http://online.wsj.com/public/resourc...et20090330.pdf
the day we were all hoping for is officially here. the day you can buy your federal govt car with your federal govt loan is here. all hail the idea that we can purchase from the federal govt (and remember that bankruptcy is still a "likely option")