Dec 15, 2008
With everything Cerberus has been doing, they’ve made it clear they have been gutting Chrysler and have every intention of dumping it. Whether all at once in a bankruptcy, or in pieces with sales to low-wage suppliers, it’s what they plan to do.
Cerberus has been draining money from Chrysler at an incredible rate. Back in June, Chrysler had more liquidity, that is, cash on hand – nine billion dollars – than did GM, a company four times its size. Now, they claim to have nothing, and need a seven billion dollar bridge loan from the federal government to pay their bills.
The money could have gone only one place: to Cerberus itself. Even if we can’t see their books, it’s clear: Cerberus has been draining money from Chrysler to pay off ITS investors.
Cerberus has been putting nothing back into Chrysler. When asked in the Congressional hearings if he had gotten any money from Cerberus, Chrysler’s chairman Bob Nardelli said he’d tried; they’d refused. Cerberus has assets of over 24 billion dollars, but they refused to send any to Chrysler to keep it above water!
Chrysler has NO real product development in the works. Chrysler has cancelled plans to import subcompact vehicles from Chery Motors, but it has no concrete plans to build any of its own. Its plan to Congress contained only vague generalities about electric cars in the future. At least GM and Ford kept up a charade of specific plans for specific vehicles.
In other words, Cerberus is trying to keep this Chrysler cash cow on life support only long enough to drain whatever money is left. Any concessions by Chrysler workers will not keep production going, but only make Cerberus’ big chief Steve Feinberg even richer.
Chrysler workers are being told to wait, see what happens with the bailout and hope for the best – but waiting will not stop Cerberus from ripping Chrysler to pieces.