Chrysler Ceasing Production Friday, Won't Promise To Come Back [Carpocalypse Now]

Chrysler just announced plans to stop production for at least a month. Did anyone else notice they wouldn't commit to coming back?

In a statement from Chrysler, the company acknowledges the Carpocalypse and explains all 30 of the company's plants will be idled on Friday, December 19. But rather than giving a specific date for returning the release merely states:

"Chrysler manufacturing operations... will not return to work any sooner than Monday, Jan. 19, 2009." (emphasis added)

While we assume the company will come back at some point, maybe in order to produce its not-so-mysterious future vehicles, it does make the situation sound even more dire than even we could imagine.

In reality, this will probably allow the company to avoid bringing production of cars they have way too many of online until/if demand increases. It will also allow the company to completely scuttle certain lines altogether.

Or they've almost completely run out of money.

The carefully and eerily worded press release below.

Chrysler LLC Adjusts Production as a Result of the Deteriorating U.S. Credit Crunch

Auburn Hills, Mich., Dec 17, 2008 -

Due to the continued lack of consumer credit for the American car buyer and the resulting dramatic impact it has had on overall industry sales in the United States, Chrysler LLC announced that it will make significant adjustments to the production schedules of its manufacturing operations. In doing so, the Company will keep production and dealer inventory aligned with U.S. market demand. In response, the Company confirmed that all Chrysler manufacturing operations will be idled at the end of the shift Friday, Dec. 19, and impacted employees will not return to work any sooner than Monday, Jan. 19, 2009.

Chrysler dealers confirmed to the Company at a recent meeting at its headquarters, that they have many willing buyers for Chrysler, Jeep® and Dodge vehicles but are unable to close the deals, due to lack of financing. The dealers have stated that they have lost an estimated 20 to 25 percent of their volume because of this credit situation.

The Company will continue to monitor the production schedules of its manufacturing operations moving forward.

[Source: Chrysler, Photo: IIHS]

Related posts:

• The 50 Most Famous Cars Of All Time
• 2008 Mitsubishi Lancer Evo MR Is Finally Coming to the US Next Month
• Spirant 180SX
• Ford is Hoping to Sell 100,000 of the 2009 Flex Crossovers a Year...Can They do It?
• [Videos] Supercar Sundays - Veyron, Enzo, Carrera GT, LP640s..

Related posts:

• Dodge Recalls Over 20,000 Charger and Magnum Police Cars [Cops And Recalls]
• Dodge Sprinter Car Profile
• Dodge Durango: Brute Power
• Super Snake for Sale: ASC-McLaren Dodge Viper NAIAS showcar
• The Dodge Police Are On The Case [Caption This]

GMAC rushes to conclude bond buyback and avoid bankruptcy

Filed under: Government/Legal, GM, Earnings/Financials

GM doesn't just have its eye on auto bailout funds -- its GMAC division (of which it owns 49%) is looking for cash from among the $700 billion pledged in the Wall Street bailout. Through the end of next year, GMAC has roughly $12 billion in bonds maturing. But to have any chance at getting Wall Street funds to address those maturing bonds, GMAC wants to become a bank holding company. And to do that, it must raise $30 billion, with $2 billion of that tapped from new sources.

GMAC is looking for 75% of its bondholders to participate in a bond buyback, whereby a bondholder would return bonds worth $1,000 and get about $800 worth of bonds with a higher dividend in return. If it gets participation from 75% of it's bondholders, that will give it $28.5 billion, which it can add to $750 million GMAC says has been pledged by shareholders as part of the $2 billion requirement. That's not quite $30 billion, but closer is better than nothing.

The problem is that, for the moment, GMAC has only 25% participation. GMAC said it had a fresh round of bondholders willing to swap, but didn't make it clear whether that would get it to 75%. If it doesn't get the financing to become a bank holding company, GMAC would likely need to declare bankruptcy. And if that happens? Well, GMAC provides inventory financing for 80% of GM vehicles worldwide. Without that source of financing, said Martin NeSmith,"There's so many dealers on the edge, if GMAC goes out of business 30 to 40 percent of dealers won't be able to get financing from anywhere else." And that spells even more trouble -- and bankruptcies -- for everyone.

[Source: Automotive News - Sub. Req.]

GMAC rushes to conclude bond buyback and avoid bankruptcy originally appeared on Autoblog on Tue, 16 Dec 2008 09:00:00 EST. Please see our terms for use of feeds.

Read |  |  | 

Related posts:

• Hyundai Tucson ix
• This Evo X Punches Time in the Face
• Audi Delays the Launch of New Crossovers Until 2009
• VW Golf BlueMotion Diesel Will Achieve 52mpg
• New Small Chevrolet 7-Seater Crossover is Coming to the US

Related posts:

• Volkswagen Releases Teaser Images of the Four-Door Passat Coupe
• LA Auto Show: Honda Reveals the FCX Clarity...The Ultimate Green Car!
• 2009 Acura RL Will Get a Major Makeover...Will it Help?
• Nissan GT-R V-Spec Racing the Nurburgring Video
• 2008 Dodge Viper SRT10 ACR Street Legal Track Car Unveiled