Washington, Apr 30 (PTI) US President Barack Obama today announced that troubled carmaker Chrysler will partner Italian giant Fiat to create the sixth largest global automaker and would head into bankruptcy with a government aid of upto USD 8 billion.
The latest move is part of efforts to give a new lease of life to Chrysler, which has been a beacon of the US auto industry and a source of pride of generation of Americans.
Obama said Chrysler has formed partnership with Fiat, creating the sixth largest global automaker and the alliance has a strong chance of success.
"It's a partnership that will save more than 30,000 jobs at Chrysler and tens of thousands of jobs at suppliers, dealers, and other businesses that rely on this company. It's a partnership that the federal government will support by making additional loans," Obama said.
Under the plan, the US government would provide approximately USD 3.3 billion in financing to support Chrysler through bankruptcy proceeding and upon closing is prepared to give about USD 4.7 billion to New Chrysler, in the form of a term loan, he said.
The alliance will retain Chrysler's existing factory footprint and continue producing Chrysler cars in US factories while Fiat would contribute billions of dollars in advanced technology and intellectual property, offering Chrysler access to a global distribution network. PTI
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