Chrysler the Next to Fall?
Posted: Fri Apr 24, 2009 8:07 pm
Report: U.S. preparing Chrysler bankruptcy
NYT: Carmaker's Chapter 11 filing could come as soon as next week
BREAKING NEWS
msnbc.com news services
updated 6 minutes ago
NEW YORK - The Treasury Department is preparing a Chapter 11 bankruptcy filing for struggling U.S. automaker Chrysler that could come as soon as next week, according to a New York Times report.
People with direct knowledge of the action told the newspaper that the U.S. Treasury has an agreement in principle with the United Automobile Workers union, whose members' pensions and retiree health care benefits would be protected as a condition of the bankruptcy filing.
In March, the Obama administration gave Chrysler has until the end of the month to reach agreements for an alliance with Italy's Fiat, a reduction in secured debt and resolution of labor issues with its unions.
President Obama said the turnaround plans that the automakers presented to Congress earlier this year hadn't gone far enough. He gave Chrysler one last chance to turn its operations around, raising the threat that he might force the company into a quick, managed bankruptcy if that proves to be the fastest way to restore it to health.
On Thursday, an Italian union official told Reuters that Fiat Chief Executive Sergio Marchionne has indicated a willingness to consider talks with Opel, the troubled German unit of General Motors.
Speaking to Reuters after participating in a meeting between union officials and Marchionne, Enzo Masini, an official with the FIOM-GGIL union, said Marchionne was ready to embark on talks with Opel, even though Fiat was already engaged in partnership talks with Chrysler.
"Marchionne said that Fiat has the ability and the capacity to handle two series of negotiations," Masini said.
The unions are concerned about the prospect of a deal with Opel since it could lead to possible job cuts and plant closures, Masini said.
