Chrysler Exec: Fiat Deal Possible, But Prepared For Worse
Chrysler is working hard to complete a deal with Fiat, but is also prepared if the deal doesn't go through, Vice Chairman and President of Chrysler Jim Press told CNBC Wednesday.
"We can't predict what will happen," Press said. "We're working toward avoiding bankruptcy. That's not our goal, but we'll be responsible in regards to the equity and the assets of the company whatever the outcome for the company is."
Press said Chrysler's goal is to make the deal with Fiat come about and that no one from the government is pressuring them into bankruptcy.
"I think we're making good progress," Press said when asked about the Fiat talks. "We're working with all our constituencies and Fiat is working 24 hours a day to bring this about."
Chrysler has three weeks to complete the deal with Fiat in order to receive more financial help from the US government.
Press made his comments at the New York Auto show where the automaker unveiled its new Grand Cherokee SUV for 2011.
"We wouldn't be at the auto show if we didn't believe we'd be around in the future," Press said. "Our product line is bubbling over and we know we can make cars and trucks the public wants."
Just a week ago the White House scolded Chrysler for relying too much on gas guzzlers, like the Grand Cherokee.
"This is a very important vehicle for us. It's one of the primary legs of the Chrysler stool," Chrysler spokesman Rick Deneau said in response to the criticism. "Customers have told us they want this vehicle and that it's the right size."
The 2011 model is 11 percent more fuel efficient than its predecessor, powered by a cleaner and more powerful engine. Still, Chrysler's decision to debut an SUV as its only new car at the New York International Auto Show seems like odd timing to say the least.
On March 30, the Obama administration issued a scathing rejection of the company's survival plan and gave it 30 days to secure a merger with another automaker, most likely Italy's Fiat SpA.
Meanwhile, the Treasury Department says General Motors and Chrysler have launched financing support programs for auto suppliers backed by $5 billion in government funds.
The programs provide government guarantees that money owed to the suppliers by the ailing auto makers will be paid. It's funded by the $700 billion bailout fund.
Treasury spokeswoman Jenni Engebretsen says the programs will restore credit in a sector that employs more than 500,000 people. The department said last month it would provide financial assistance to the auto suppliers.
Besides money from the bailout fund, the government is supporting the auto industry with about $25 billion in loans.