Chrysler Facing Bankruptcy Filing Says, White House

April 30, 2009

(ChattahBox)—Reports coming out of the White House this morning suggest Chrysler will be filing a Chapter 11 Bankruptcy, as soon as today. Thursday is the deadline imposed by the Obama administration for Chrysler to meet White House restructuring demands to qualify for additional stimulus funds, and it looks like Chrysler has failed.
Despite Chrysler wrangling concessions from its unions and coming to terms with a merger deal with the Italian carmaker Fiat, a stubborn group of non-bank bondholders have refused to reduce secured debt obligations of Chrysler according to Treasury terms.
CNN is reporting that Fiat may still strike its deal with Chrysler, but it will now be within the confines of a bankruptcy restructuring. Owners of Chrysler vehicles will have their warranties honored by the U.S. government. How that will all work is not yet known.
President Obama is expected to hold a press conference this afternoon to answer questions regarding Chrysler’s impending bankruptcy. This is not the end for Chrysler, there is still hope the carmaker can emerge from its Chapter 11 filing, as a leaner meaner company.

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