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Chrysler reaches deadline to submit final restructuring plans

Today is Chrysler’s final deadline from the US government to show its final restructuring plans to gain additional funding to allow the company to survive.

Industry commentators are expecting Chrysler to enter Chapter 11 bankruptcy protection, which means the Government will go in and restructure the business.

If this does happen, Chrysler’s operations and subsidiaries outside of the US will be protected while the company goes through the restructuring process.

If Chrysler does go into Chapter 11 it is not expected to hinder a possible tie-up deal with Fiat.

US president Barack Obama said yesterday that he was hopeful that a deal with Fiat could be agreed. In a press conference last night he said he was determined to end the government's involvement in the industry soon.

He said: "I don't want to run auto companies, and I don't want to run banks. I've got two wars I've got to run already - I've got more than enough to do."

If the Fiat deal is agreed, Chrysler will be majority-owned by its largest trade union. The United Auto Workers union has agreed to allow Chrysler to halve the $10.6 billion (£7.1bn) it is meant to invest in a healthcare trust, in return for a 55% stake in the company.

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