Chrysler's Ultimate Deadline: Reach an Acceptable Rescue Deal with Fiat, or Liquidate
Will there be a Chrysler Corp. in nine days? If the federal government's latest ultimatum is to be believed, there will be no Chrysler unless it's part of Europe's second-biggest automaker, Fiat. Treasury Department officials, representatives of the United Auto Workers union, and Chrysler and Fiat executives are meeting this week in Washington to determine whether Fiat, which has expressed a tentative interest in Chrysler, can strike a deal by April 30.
According to The Wall Street Journal, a purchase by Fiat may be the only option left for Chrysler. Citing "people familiar with the negotiations," the Journal reported that some Obama administration officials "have come to conclude that Chrysler isn't worth trying to save because of its weak product line and lack of international reach." Still, unnamed Chrysler and Fiat representatives, according to the article, believe the two parties are nearing an agreement. But even with a deal, there's no telling what a Fiat-owned Chrysler would look like.
For a deeper understanding of how Chrysler and other automakers got into the mess they're in, see these Knowledge at Wharton articles and podcasts:
Changing Course: The Chrysler Deal, Rising Gas Prices and Other Car Talk
Driving Lessons: Dieter Zetsche's Experiences behind the Wheel of Daimler-Chrysler and Beyond
The U.S. Auto Industry: Dangerous Curves Ahead?
Behind the Curve: Have U.S. Automakers Built the Wrong Cars at the Wrong Time — Again?
On the Skids: Are U.S. Automakers Running Out of Time — and Options?