Additional funds contingent on completion of Fiat deal If the feds took a tough stand with GM in forcing Rick Wagoner to resign, Chrysler could be in for a dose of even stronger medicine.
As reported by the Detroit Free Press, the auto task force is willing to provide Chrysler with an additional $6 billion, but only if the company can complete the much-discussed alliance with Fiat by the end of April.
If Chrysler can’t come to terms with Fiat, Chrysler will be deemed non-viable and will get no additional government assistance.
Is she going to come with the deal?
The government’s requirements are to be formally announced sometime March 30.
The task force wasn’t satisfied with the restructuring plan Chrysler submitted Feb. 17.
In manufacturing productivity, it found Chrysler has not invested enough in common architectures and flexible capacity.
Under the proposed alliance, Fiat would own 35% of Chrysler and provide four small-car programs, two engines and two transmissions that are worth an estimated $8 billion to $10 billion.
The first Fiats would reach U.S. dealerships in 2011 (We can't wait).
If Chrysler and Fiat deliver what the task force requested, the administration will take steps that could help their alliance succeed. These include a government-funded program to back warranties of both Chrysler and GM, and a previously announced $5 billion in aid to assist the two automakers with payments to their suppliers.
