Chrysler CEO: We're 'operationally' bankrupt

[javierruizleon]

Chrysler CEO: We're 'operationally' bankrupt

NEW YORK (CNNMoney.com) -- Chrysler Corp., the troubled automaker bought by private equity just four months ago, is scrambling to sell assets amid indications of huge losses, as access to cash becomes increasingly scarce, according to a published report Friday.

"Someone asked me, 'Are we bankrupt?'" the Wall Street Journal quoted Chrysler boss Robert Nardelli telling employees at a meeting earlier this month. "Technically, no. Operationally, yes. The only thing that keeps us from going into bankruptcy is the $10 billion investors entrusted us with."

To raise money, Chrysler is looking to sell over $1 billion in land, old factories, and other holdings, even if it has to let those properties go for under book value, the Journal said.

In an interview with the Journal, Nardelli confirmed the comments and declined to give a financial forecast for 2008, saying only that Chrysler "will make a pretty significant improvement" over the $1.6 billion the company is set to lose this year. The Journal said Nardelli originally hoped to turn a profit in 2008.

The rush to raise capital comes amid constricting access to money as more banks and other lenders face heavy losses related to subprime mortgages.

[sherrimae]

I hope the government isn't planning to bail them out with our tax dollars again.

[stevesherri]

This company has been called DaimlerChrysler for almost 10 years, but now that they're in trouble, they're Chrysler again.

The way things are going, Daimler could sell off Chrysler, and our gov't would bail out Daimler.

That makes more sense than paying Medicare / College tuition to illegal immegrants.