President Barack Obama confirmed today that car maker Chrysler LLC would go into Chapter 11 bankruptcy and enter a deal with Italy's Fiat to survive.
"Today I am pleased to announce that Chrysler and Fiat have formed a partnership that has a strong chance of success," Obama said.
He said the bankruptcy process would be quick and efficient and expressed confidence that Chrysler would emerge from the process stronger and more competitive.
"As part of their agreement, every dime of new taxpayer money will be repaid before Fiat can take a majority ownership stake in Chrysler," Obama said.
"It's a partnership that will give Chrysler a chance not only to survive, but to thrive in a global auto industry."
Obama criticised a handful of "speculators" for holding out on a deal in the hopes of getting further U.S. taxpayer money.
He praised union workers for making concessions and financial institutions, led by JP Morgan, for agreeing "to reduce their debt to less than one-third of its face value to help free Chrysler from its crushing obligations."
Obama praised the car company's management.
"Chrysler's management - and in particular, its CEO, Robert Nardelli - have played a positive and constructive role throughout this process."
The president said Chrysler and its bigger rival, General Motors would bring the U.S. auto industry back to its former position of strength.
"My team will continue working with General Motors as they strengthen their business plan and move toward restructuring that's consistent with the principles that I've laid out," he said.
"Chrysler and GM are going to come back. I'm very confident that we are going to make the U.S. auto industry once again the best auto industry in the world."