Chrysler, Americas 3rd largest auto company, announced that it will file for bankruptcy protection and at the same time that it has entered into a partnership with Fiat Motors of Italy. They will become eligible for up to 8 billion in federal aid on top of the over 4 billion they have already received.
The bankruptcy case was filed in United States Bankruptcy Court in New York, with the first hearing scheduled for tomorrow morning. It marks the first time a major American car company has tried to restructure under bankruptcy protection since Studebaker in 1933.
President Obama spoke today at the White House, stating "I have every confidence that Chrysler will emerge from this process stronger and
more competitive” The president emphasized the speed with which the administration expects the bankruptcy process to be completed, saying
that it would be “quick, official and controlled” and that the lives of those
who work at Chrysler or live in communities where the company has its operations would not be disrupted.
Fiat, which also owns Ferrari and Maserati was close to filling for bankruptcy just five years ago but is now thriving under the leadership of CEO Sergio
Marchionne. Mr. Marchionne said that the first cars from the Fiat-Chrysler
partnership could be rolling off the assembly line in 18 months!