Beleaguered auto manufacturer Chrysler filed for Chapter 11 bankrupty protection today in a move encouraged by the Obama administration. The bankruptcy filing is intended to rapidly clear Chrysler's debts and smoothe a path to a partial acquisition by Italian automaker Fiat.
Chrysler, which received billions of dollars from the United States government, then asked for more to stay afloat, is now conceding an inability to meet its obligations. Chrysler will idle its production lines for an extended period while the company restructures. In an interesting twist, the reorganized company will become majority owned by its employees via an independent trust controlled by the United Auto Workers union's healthcare fund. Fiat and the US government will own the rest.
No announcements have been made at this time regarding Chrysler's product lines or dealer network.