GM, Chrysler to Cut 3,000 Auto Dealers Nationwide
Combined, GM and Chrysler have over 9,000 franchised auto dealerships. If the information below pans out, that’s a third of their combined franchises to be shuttered …
From Reuters:
General Motors Corp and Chrysler aim to drop as many as 3,000 U.S. dealers and are expected to begin sending notifications as early as Thursday, three people briefed on the still developing plans said.
GM, facing a U.S. government-imposed deadline of June 1 to restructure or file for bankruptcy, is expected to send termination notices to up to 2,000 dealers — a third of its roughly 6,000 U.S. dealers, the sources told Reuters.
Chrysler, which filed for bankruptcy on April 30, will also tell up to 1,000 of its 3,189 U.S. dealers it is terminating their franchise agreements, according to the sources who asked not to be identified because the controversial closure plans have not been yet announced.
Google Trend: ‘Chrysler Stock Price’
Number 94 on Google Trends: April 30, 2009 is ‘Chrysler Stock Price.’
If you’re here because you searched for how much of a steal you can grab some Chrysler stock for, you can keep looking but you’ll never find the price – Chrysler is privately held.
These guys are going to own Chrysler.
Transcript: President Obama Remarks on Auto Industry, Chrysler Bankruptcy, Fiat – April 30
Chrysler – New Lease on Life
(Source: White House Press Office)
THE PRESIDENT: Hey, guys. I know you haven’t seen enough of me lately, so — (laughter.)
One month ago, I spoke about some of the problems that have led to the crisis in the auto industry, and about what would be required to ensure that General Motors and Chrysler emerged from their current troubles stronger and more competitive. My team will continue working with General Motors as they strengthen their business plan and move towards restructuring that’s consistent with the principles that I’ve laid out.
And today, after consulting with my Auto Task Force, I can report that the necessary steps have been taken to give one of America’s most storied automakers, Chrysler, a new lease on life.
Transcript: President Barack Obama Press Conference, First 100 Days, April 29
(Source: CNN)
President Obama: Please, be seated. Before we begin tonight, I just want to provide everyone with a few brief updates on some of the challenges we’re dealing with right now.
First, we are continuing to closely monitor the emergency cases of the H1N1 flu virus throughout the United States. As I said this morning, this is obviously a very serious situation, and every American should know that their entire government is taking the utmost precautions and preparations.
Our public health officials have recommended that schools with confirmed or suspected cases of this flu strongly consider temporarily closing. And if more schools are forced to close, we’ve recommended that both parents and businesses think about contingency plans if their children do have to stay home.
Tomorrow for Chrysler: Chapter 11 & Fiat
from Bloomberg:
President Barack Obama plans to announce tomorrow that Chrysler LLC will be placed into Chapter 11 bankruptcy, leading to an alliance with Italian automaker Fiat SpA, people involved in the matter said.
Administration officials are still resolving outstanding issues, and the plan is not finished yet, said one of the people, who declined to be named. Any bankruptcy filing could come as soon as tomorrow, people familiar with the matter said.
Chrysler’s best assets would be sold to a new entity that would have an ownership structure similar to that envisioned in an out-of-court deal between the Auburn Hills, Michigan-base automaker and Turin, Italy-based Fiat, the people said.
The Italian company would become a 20 percent owner of Chrysler, and a union retiree health-care trust fund would own 55 percent, with the rest of the company staying in the government’s hands initially, people familiar with the matter said.
- Treasury pushes for Chrysler-Fiat Deal – Detroit Free Press
- Chrysler Union Members Vote – Wall Street Journal
Transcript: Larry Summers on Fox News Sunday – Economy, Chrysler
Chris Wallace, Moderator
Larry Summers, Council of Economic Advisors, Obama Administration
WALLACE: And hello again from Fox News in Washington. From the moment he took the oath of office, fixing the economy has been job one for President Obama. Now, as he nears the end of his first 100 days, that seems as big a challenge as ever.
Joining us to discuss where things stand is the president’s top economic adviser, Lawrence Summers.
Mr. Summers, federal regulators met with executives of the nation’s 19 largest banks on Friday to tell them how they did in those government stress tests. I know at this point you can’t reveal the individual results, but overall, what kind of shape is the system in?
SUMMERS: As Secretary Geithner said, the vast majority of the banks in the United States are well capitalized. There’s work that needs to be done. It can be done in many ways — by raising private capital, through exchanges, backstopped by government capital where necessary.
But I think we’re going to be in a good position to provide the support and set the framework in which the banking system can move along the process of recovery.
We’ve got a long way to go, but in just three months we’ve taken a whole set of important steps — mortgage relief for 9 million American homeowners that’s going to enable families who otherwise couldn’t have refinanced their mortgage to refinance their mortgage; substantial program of support for small businesses who have often been the group that bore the brunt of this credit crunch; measures to get the markets going so that you’ve got more of a flow of mortgage credit.
We’ve seen near — extremely high levels of mortgage refinancing, a substantial reduction in credit spreads for consumers. We’ve got a long way to go. There are still serious problems in this economy.
But both with respect to the financial side and, what’s obviously crucially related, with respect to the income side, the measures we’ve taken I think are very strong and offer the prospect of containing a very serious situation.
Chrysler, UAW Reach Deals in U.S. & Canada In Line With Federal Guidelines for More Taxpayer Financing
Neither the United Automobile Workers union nor the company released details of the agreement, which modifies the union’s 2007 contract and reduces the amount of money Chrysler must pay into a new health care fund for retirees.
The union plans to have its 26,000 Chrysler workers vote on the deal by Wednesday.
“We recognize this has been a long ordeal for active and retired auto workers, and a time of great uncertainty,” the union’s president, Ron Gettelfinger, said in a statement. “The patience, resolve and determination of U.A.W. members in these difficult times is extraordinary, and has made it possible for us to reach the agreement we will present to our membership.”
The Canadian Auto Workers union said late on Sunday its members voted 87 percent in favor of a new collective agreement with Chrysler [CBS.UL] that will save the company about C$240 million ($198 million) annually.
The union made the steep concessions in order to try to help the besieged company qualify for billions of dollars in government aid in Canada and the United States and avoid liquidation.
“The reality is this was probably the most difficult and unprecedented time in the history of auto workers,” CAW President Ken Lewenza told Reuters.
Text: Letter from Chrysler’s Nardelli to Canadian Auto Workers
(Source: Financial Post)
A Message from Tom LaSorda and Bob Nardelli
Dear Employees,
Today, we are at a crossroads in the history of Chrysler. Let’s take a look at what’s happened in the past few weeks.
On February 17 and February 20, Chrysler submitted its Viability Plan to the U.S. Treasury and U. S. Administration; and to the Canadian governments, respectively.
On March 30, U.S. President Barack Obama stated that Chrysler’s Viability Plan was unacceptable. “It’s with deep reluctance but also a clear-eyed recognition of the facts that we’ve determined, after careful review, that Chrysler needs a partner to remain viable.”
Full Text: President Barack Obama Statement on GM & Chrysler Bailout Status – Auto Task Force – March 30
(Source: White House Press Office)
Good morning, everybody.
One of the challenges we’ve confronted from the beginning of this administration is what to do with the state of the struggling auto industry. In recent months, my Auto Task Force has been reviewing requests by General Motors and Chrysler for additional government assistance, as well as plans developed by each of these companies to restructure, to modernize, and to make themselves more competitive. Our evaluation is now complete. But before I lay out what needs to be done going forward, I want to say a few words about where we are and what led us to this point.
The Daily Graphic: The Big Three’s Dashboard Indicators in the Red
Great graphic from the New York Times. Go read the story, U.S. Moves to Overhaul Ailing Automakers.
More Government Cash on Way to GM, Chrysler
The New York Times is reporting that on Monday the Obama Administration will announce more aid to two of the Big Three, GM & Chrysler. Apparently strings will be attached in that the automakers are being told to press the gas with bondholders and unions to come to agreements which will forestall sending either one of the two companies into bankruptcy. If either company goes into bankruptcy protection, pensioners healthcare gone and bondholders once AAA-rated investments will be worth nothing.
