Bailout Watch 473: PTFOA Rips Chrysler a New One [Download Determination of Viability; Chrysler Here]
The Presidential Task Force On Automobiles (PTFOA) came, they saw, they laughed. Well, maybe not laughed. But there’s a kind of humor in the fact that the PTFOA shot holes in every single one of the company’s assumptions, save the idea that a FIAT merger will save Chrysler. The federal quango’s “ Determination of Viability Study; Chrysler, LLC” is, to say the least, not kind to the automaker’s assertions. It slates ChryCo’s scale (too big), quality (sucks), product mix (sucks), manufacturing (outdated), and geographic concentration (U.S.-centric). And then concludes. without any credible justification “A partnership with another automotive company, such as Fiat or another prospective partner, which addresses many of these issues could lead to a path to viability for Chrysler.”
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Thanks for the link Richard Chen. Another interesting tidbit is in that WSJ story: "Cerberus will maintain a controlling stake in Chrysler’s financing arm, Chrysler Financial, according to two people briefed on the plan. Cerberus will utilize the first $2 billion in proceeds from its Chrysler Financial holding to backstop a loan allocated to Chrysler automotive in December by the Treasury Department." So, even Cerberus' stake in Chrysler Financial is at least partly going to have to be turned over to the gov't to satisfy some of the open loan balances. Adding it all up here, the PTFOA is basically filling he role of debtor-in-possession at both GM and Chrysler. The feds are providing the near-term cash to keep the lights on whilst calling the major shots on what happens next.
Talk about never giving up. With no product in the pipeline, and all of the journals trashing their newest models, we have a fire sale of huge proportions. When has Fiat challenged the Japanese in Europe or anywhere else? They are not going to do it in America either. Why not just be honest with the American public; You get $3000 emoployee discount (you pay what we pay if wanted to pay) and you send the Whitehouse a special Obama request vouncher for the other $3000.00. Now everyone is happy. Plus the consumer for the first time sees money coming directly to him from his uncle Sam.
As Presidents go, at least this one sorta gets it. His commission is looking at big corporations and ripping them apart. He got Wagoner to get out for chrissakes! Gobama!
[...] has been years late and billions short, Chrysler’s Cerberus-hired management has shown no public signs of elementary competence. Where GM’s product plans are questionable (Cadillac station wagon?), Chrysler’s are an [...]