April 30th, 2009
12:51 PM ET
14 years ago

Obama confirms Chrysler bankruptcy; blasts investor group

WASHINGTON (CNN) - President Barack Obama confirmed Thursday that struggling automaker Chrysler will file for bankruptcy and merge with Fiat.

The president also blasted a group of investment funds and hedge funds for holding out for an "unjustified taxpayer bailout."

Several financial institutions, led by J.P. Morgan, agreed to reduce Chrysler's loan repayment obligations by as much as two-thirds, Obama said.

But "a group of investment firms and hedge funds decided to hold out for the prospect of an unjustified taxpayer-funded bailout" Obama said. "They were hoping that everybody else would make sacrifices and they would have to make none."

Some investors "demanded twice the return that other lenders were getting," Obama noted.

"I don't stand with them. I stand with Chrysler's employees and their families and communities. I stand with Chrysler's management, its dealers, and its suppliers. I stand with the millions of Americans who own and want to buy Chrysler cars. I don't stand with those who held out while everybody else made sacrifices."

Chrylser's bankruptcy won't affect consumers, Obama promised. Chrysler's warrantees have been guaranteed by the federal government.

"Every dime of taxpayer money will be repaid" before Fiat takes a majority stake in Chrysler, Obama added.


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