Archive for the ‘Troubled Asset Relief Program’ tag
And Then There Were Two
U.S. automakers are on the ropes, and “rescue” funding appears to be arriving too slowly to avert some serious downsizing. The Bush administration refused to subsidize Cerberus’ unloading of Chrysler onto General Motors Corp, so now Cerberus is apparently seeking funding via GMAC. Both GM and Ford Motor Co report on Friday, and the results are expected to be miserable. But in even worse shape is Chrysler LLC. If Cerberus Capital Management is able to get bank status and TARP (Troubled Asset Relief Program) funding for GMAC, there is some chance that Cerberus will help Chrysler limp along long enough for a new Obama administration to come to the industry’s rescue. If however Cerberus is unsuccessful with GMAC’s conversion, there will be even more pressure for a merger of Chrysler with General Motors. Unfortunately, GM is hardly in any position to be an acquirer.
Procerity’s Prognosis: Chrysler LLC will soon cease to exist as an independent firm.