The horror of a Chapter 11 filing by a once-powerful member of the Big 3 obscured some good news last Thursday: Chrysler LLC has a future. It will live.
Even as he announced that Chrysler was going into bankruptcy, President Barack Obama had morphed from the subdued president who, a month before, gave Chrysler 30 days to avoid a death sentence.
He went from the Grim Reaper to Chrysler's Salesman in Chief.
On March 31, Obama assured the world that the government would continue lending to keep General Motors alive, and that GM would ultimately prosper.
"The situation at Chrysler is more challenging," he said ominously. Chrysler would need a partner. Unless Chrysler could reduce its debt and make a deal with Fiat that would protect the taxpayer, "We will not be able to justify investing additional tax dollars to keep Chrysler in business."
The March 31 message: GM survives. Chrysler? Not looking so good.
So you'd have to say April was a pretty good month for Chrysler.
"The necessary steps have been taken to give one of America's most storied automakers, Chrysler, a new lease on life," Obama said on Thursday, April 30. He called Chrysler "an icon of America's auto industry and a source of pride for generations of American workers."
And a Chrysler-Fiat partnership is "a partnership that the federal government will support by making additional loans."
He praised Chrysler CEO Bob Nardelli, the UAW and some of the big banks that had agreed to forgive the bulk of their loans to Chrysler. (Those loans actually financed the deal by providing cash to Chrysler when Cerberus Capital Management LP got Chrysler from Daimler for essentially nothing.)
By contrast, Obama practically spit when he condemned the "investment firms and hedge funds" who refused to go along and who therefore forced Chrysler into Chapter 11.
"I don't stand with them," he said. "I stand with Chrysler's employees and their families and communities. I stand with Chrysler's management, its dealers, and its suppliers. I stand with the millions of Americans who want to buy Chrysler cars."
Obama got so pumped up about helping Chrysler that he crossed a politically correct line, enraging the American International Automobile Dealers Association when he said, "If you are considering buying a car, I hope it will be an American car."
We'll see how this plays out. Even when Chrysler starts manufacturing those Fiat-designed cars in America in a couple of years, there's no guarantee that Americans will buy them -- especially if gasoline prices stay low.
Bankruptcy is never anything to brag about. So it was a sad week for the American auto industry in one sense. How the mighty have fallen. But if you care about American car companies, don't forget: Chrysler now has a source of money for the foreseeable future. Chrysler lives.