Chrysler lenders propose equity swap terms


My loose dependence on Chrysler's continued existence aside, I'm afraid that either way, we all pay for this. We can loan some money to Chrysler, or let them take losses in bankruptcy, or encourage a Fiat alliance, or let them liquidate and we will still all end up paying the price. Liquidation is probably the worst for the public given that we'll all pay more in taxes to supplement what's lost when Chrysler and all of their dealers evaporate - and there's no potential upside for taxpayers in the long-run. With any of the other three options, there's some potential upside, albeit quite doubtful if we allow the same people to run it the same way.

As for Fiat, this is the opportunity of a lifetime. Chrysler is still a million-plus unit a year car company that is gaining market share in a few important markets, particularly the light-duty truck market - one of the most profitable sectors. Further, Fiat will own over 3,000 outlets for their own vehicles over night. Will they be competitive in our market? No one knows. However, they must be doing something right considering they outsold Chrysler last year without selling a single car in the US market - the largest world market for cars.


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