Opel and Fiat spells bankruptcy for Chrysler and GM
Press reports coming out of Germany are suggesting that the Germans are looking to hook up Opel with Fiat in order to prevent a lot of job losses when General Motors goes under. In my view, this means curtains for both Chrysler and GM and could spell some massive increases in jobless claims and unemployment this summer.
GM as already said that it would be shutting down 13 plants this summer to work off inventory. But, a GM bankruptcy would guarantee a lot layoffs, and these would be permanent.
Press Reports out of the U.S. suggest that U.S. lawmakers still believe that Fiat is going to swoop in for Chrysler while it is in Chapter 11 and save Chrysler and prevent a lot of layoffs.
The Treasury Department is preparing a Chapter 11 bankruptcy filing for Chrysler that could come as soon as next week, people with direct knowledge of the action said Thursday.
The Treasury has an agreement in principle with the United Automobile Workers union, whose members’ pensions and retiree health care benefits would be protected as a condition of the bankruptcy filing, said these people, who asked for anonymity because they were not authorized to discuss the case.
Moreover, Fiat of Italy would complete its alliance with Chrysler while the company is under bankruptcy protection.
I have my doubts.
The most advanced, according to industry circles, are the preparations for an alliance of Fiat of Opel. The rumor is that next Tuesday the signing of a non-binding letter of intent is planned.
Fiat is going to pick EITHER Opel or Chrysler, not both. My gut tells me that Opel is in the driver’s seat here.
The Obama Administration had better wake up because it is being played by Fiat. They could themselves with two bankrupt automakers, no suitors, and a lot of angry, unemployed workers.
And, then you can kiss your recovery goodbye.
U.S. Is Said to Prepare Filing for Chrysler Bankruptcy – NY Times
Fiat und Magna greifen nach Opel – FAZ