Well there you have it, it’s official. Chrysler has filed for Chapter 11 bankruptcy protection in the Bankruptcy Court of New York. The New York Times, and every other news publication under the sun, is reporting that the US government will be providing US$8 billion for the restructuring effort over the next few months. Mr. Obama, who gave the press conference just minutes ago, also said that our Canadian government will be providing 1/3 the amount to Chrysler that the American government is, which translates to about $2.6 billion for our pockets. Ouch.
This period of restructuring will also allow Fiat to swoop in like a vulture and pick over the remains of Chrysler. So once Chrysler/Fiat emerge from Chapter 11 protection, we’ll be that much closer to getting the Fiat 500. Booyaa! CarEnvy has covered this merger and its implications more than a few times, which you can follow here, here, here, here, here, here, here, here, and here. So this shouldn’t really be a surprise to anyone.
President Obama’s goal is to have a “surgical” bankruptcy. This probably involves latex and anaesthesia, which, from my personal experience, can make for a very good night. But does it make for a good bankruptcy? Time will tell.
The biggest question on my mind is, would you (or anyone else) buy a vehicle from an automaker that is in bankruptcy protection? Although maybe asking this question ignores the premise that someone would actually want to buy a Chrysler product in the first place. [NYT]