WASHINGTON — Chrysler is feeling some pushback — from Democrats, not just Southern Republicans — on its plan to take U.S. government loans and team up with Italian automaker Fiat S.p.A.
Sen. Robert Menendez, D-N.J., in a letter to President Barack Obama late last week, suggested that Chrysler be forced to give back loan money if a "foreign" company gets control of the automaker.
Earlier, Sen. Jeff Bingaman, D-N.M., questioned Obama's treasury secretary nominee, Timothy Geithner, on how Fiat could get a substantial Chrysler stake without putting up any money, especially after U.S. taxpayers are heavily invested.
Chrysler understands that public officials are going to have questions, and it is eager to provide answers, said a company source, insisting on anonymity.
The company has been consistent since it first sought emergency federal loans in November, saying it would need the money, as well as partnerships and alliances, to become healthy again, the source added.
Chrysler has received $4 billion in loans so far and seeks $3 billion more. An additional $1.5 billion is going to Chrysler Financial.
Chrysler and Fiat will work together on a restructuring plan that must be submitted to the Obama administration by Feb. 17, the companies announced.
Industry sources say UAW support for the alliance should help overcome Democratic concerns.