Chrysler To File For Bankruptcy

[Ti-Amie]

DETROIT - Chrysler will file for bankruptcy protection after talks with creditors aimed at reducing its huge debt burden failed, officials said on Thursday.

The No. 3 U.S. automaker faces a government deadline of 11:59 p.m. Thursday to have deals in place with labor, creditors and Italian automaker Fiat. Two of the three pieces appeared to be in place. A small group of debtholders were the remaining obstacle, as they hold out for a better deal from the U.S. government.

Talks between Chrysler LLC's lenders and the Treasury Department to reduce the automaker's secured debt and keep it out of bankruptcy protection broke down early this morning, a person familiar with the talks said.

President Barack Obama is scheduled to talk about the auto industry in remarks at 12 noon EDT.

Four banks with 70 percent of Chrysler's $6.9 billion debt had agreed to erase it for $2 billion, or less than 30 cents for each dollar held. That left Chrysler's fate in the hands of about 40 hedge funds with about 30 percent of the debt.

To entice the hedge funds into going along with the banks, the government on Wednesday afternoon added $250 million to the $2 billion that the banks had settled for and gave the hedge funds a 6 p.m. deadline to work it out, two people briefed on the talks said.

http://www.msnbc.msn.com/id/30489906/

[missinandre]

Depressing news

I have a new van....and I see a lot of people driving around town in new vehicles and I wonder.......how the hell can these kind of things be happening?

[manolo]

DETROIT - Chrysler will file for bankruptcy protection after talks with creditors aimed at reducing its huge debt burden failed, officials said on Thursday.

Not a minute too early. Yes, it's sad and everything, but if they can't be succesful at making cars, well, too bad...