Most people knew struggling automakers General Motors Corp. and
Chrysler LLC on Tuesday would ask the Treasury for money in addition to
the $17.4 billion of government funding they already received.
Suggesting up to another $22 billion, however, was surprising. Below is
an outline of just what Chrysler wants and plans on doing over the coming
months, including cutting thousands more jobs.
So far, Chrysler has received $4 billion and:
- needs another $5 billion due to incredibly weak demand (that's $2 billion more than it originally proposed needing after the $4 billion installment in December);
- will cut 3,000 jobs -- on top of the 32,000 eliminated since January 2007;
- plans 24 vehicle launches in two years, including a new Jeep Grand Cherokee, Dodge Charger, Dodge Durango and Chrysler 300; and
- announced electric technology as a primary strategy for developing fuel-efficient vehicles, including an electric-drive vehicle in 2010;
- may sell a significant stake to Fiat SpA;
- will reduce fixed costs by $700 million in addition to the $3.1 billion reduction in 2008;
- will discontinue three vehicle models (including that oddly styled PT Cruiser) in addition to the four discontinuations announced;
- will reduce 100,000 units of manufacturing capacity; and
- will sell $300 million additional nonearning assets.
In a letter to stakeholders, CEO
Bob Nardelli wrote that "our viability plan demonstrates that Chrysler will repay the U.S. government loans in full, with a premium beginning in 2012. As we have indicated all along, shared sacrifice is necessary for Chrysler's survival."
The next key date in Chrysler's run to avoid bankruptcy is March 31, when it
will submit its second progress report to the U.S. Treasury. -
Baz HiralalSee the AP storyChrysler announcement
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Adele Gulfo
And the winners are...
Yeah, Chrysler need some help from US because their sales drop.