Author: Shawn Wilson
Title: Chrysler Files For Bankruptcy, Who\’s Next?
Article: Well it’s official as of April 30th the 2009 Chrysler corporation will officially be filling for bankruptcy and the federal government is assuring the business world it will happen quickly. Along with this bankruptcy Chrylser will be joining forces with Italian auto maker Fiat. Why the merger? Fiat is a world leader in building small cars and this merger will give Chrysler access to their small car technology which the US and the rest of North America clearly needs more of.
So what does this bankruptcy do and how will it affect the people that buy the cars, work for the company and the companies that supply parts and services to Chrylser? Well each requires its own answer but I will try to summarize. Assuming everyone understands the principal behind bankruptcy, which basically allows the company or an individual to clear their debt load into a smaller more manageable amount. This process has always amazed me because in the end creditors will lose big time and in the case of Chrysler that big is with a capital B!
Here is where the real value is for Chrysler past unloading a ton of debt, they get to redo all of their existing contracts. Some of the more damaging aspects of the auto industry has been the rise of Auto unions in both the US and Canada. The amount of money paid to the union members in the form of pensions alone is staggering, this by itself would bankrupt most companies and in my belief is a huge reason why all of the big three are having problems!
So bankruptcy allows Chrysler to unload debt, restructure the business overall and allows for new contracts. Not a bad deal when you think about it and to boot they will receive the much needed stimulus money from again the US and Canadian governments.
The real negatives lie with the existing suppliers, creditors and the employees. There will no doubt be more plant shut downs and I have no doubt those that are left with a job will be working for less money. While this may sadden some of us especially those affected by the bankruptcy, making Chrylsyer and any of the other large American auto makers become sustainable businesses is much better than losing everything and watching the companies disappear.
All we know for sure is that Chrysler is the first to start this process, we know GM is very close to doing the same and Ford after posting another Billion dollar loss in one quarter can’t be far behind.
Maybe if this companies start building the cars that the consumers are actually demanding and running factories as lean as possible we won’t run into this problem again. Who knows what the future holds! This article was written by Shawn Wilson, a member of the customer support team at Datepad, where we always offer free internet dating. Datepad has a massive directory of informative free dating articles along with a great list of dating site reviews on our dating blog.
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