by Bill McBride on 3/30/2009 01:11:00 AM
Monday, March 30, 2009
From the WSJ: Government Forces Out Wagoner at GM
The administration's auto team announced the departure of [General Motors Corp. Chief Executive Rick Wagoner] on Sunday. In a summary of its findings, the task force added that it doesn't believe Chrysler is viable as a stand-alone company, and suggested that the best chance for success for both GM and Chrysler "may well require utilizing the bankruptcy code in a quick and surgical way."On Chrysler:
The government said it would provide Chrysler with capital for 30 days to cut a workable arrangement with Fiat SpA, the Italian auto maker that has a tentative alliance with Chrysler.From the NY Times: U.S. Moves to Overhaul Ailing Carmakers
If the two reach a definitive alliance agreement, the government would consider investing up to $6 billion more in Chrysler. If the talks fail, the company would be allowed to collapse.
President Obama is scheduled to announce details of the auto package at the White House on Monday, but two senior officials, offering a preview on condition of anonymity, made clear that some form of bankruptcy — a quick, court-supervised restructuring, as they described it — could still be an option for one or both companies.On GM:
G.M., on the other hand, has made considerable progress in developing new energy-efficient cars and could survive if it can cut costs sharply, the task force reported. The administration is giving G.M. 60 days to present a cost-cutting plan and will provide taxpayer assistance to keep it afloat during that time.As expected, it sounds especially grim for Chrysler.
Posted by Bill McBride on 3/30/2009 01:11:00 AM