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Chrysler: Without $5 billion more in loans, liquidation our only alternative | Freep.com | Detroit Free Press

Chrysler: Without $5 billion more in loans, liquidation our only alternative

WASHINGTON – Chrysler LLC will need an additional $5 billion to survive the U.S. recession, telling the Obama administration today that it plans to cut an additional 3,000 jobs this year and eliminate the Chrysler Aspen, Dodge Durango and the Chrysler PT Cruiser as part of its restructuring plan.

The automaker, which disclosed today that it lost $8 billion in 2008, warns that if it does not receive the federal money and needed concessions by March 31, "management believes the only alternative would be to immediately plan for an orderly wind down of all operations through a court-supervised liquidation.


"This is clearly not an alternative Chrysler would prefer, but is one that the Company is prepared to implement if required," the company said in its submission to the U.S. Treasury.

The additional money, some of which Chrysler has said it needs before the end of March, would come on top of the $4 billion that Chrysler received last year, for a total rescue of $9 billion.


Along with the job cuts, Chrysler said it is planning to cut total costs by $700 million this year, stop building three models, sell $300 million in assets and cut its factory capacity by 100,000 vehicles.


The company said it had reached agreement with the UAW for concessions on wages to be competitive with foreign-owned automakers in the United States and retiree health-care trust funds, but was still in talks with suppliers and debtholders.


Chrysler said the plan “demonstrates standalone viability which could be enhanced through a strategic alliance” with Fiat SpA. Chrysler says it plans envisions it beginning to pay back the federal loans through 2012.


The government requested that as part of its plan, Chrysler describe a liquidation plan, including a Chapter 11 plan. Under a Chapter 11 reorganization, the company would require $20 billion to $25 billion in financing to make it through two years.


“It would cost a lot more money and it would cause tension and concern both among the dealers and the customers that’s not necessary,” said Chrysler Vice Chairman Jim Press.
 

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Grab Your ***** By The Horns
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Chrysler is smoking crack. They shouldn't receive another penny and shouldn't have received any handout prior. Chrysler should not be looking for giveback savings off the backs of their labor force who are the backbone of the company working on the assembly lines living paycheck to paycheck as it is while the larger than necessary management structure who contributes no physical labor toward producing their product continues to receive rediculously high salaries and bonuses. The cost cutting should come from the CEO's first and their unnecessary expense accounts plus private luxury jets.
 

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Scary to hear.
 
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