Cuda340

We didn't realize how close Chrysler was to dying. In an October 21, 2009 first-person account posted on Fortune magazine's Web site and in a Brookings Institution speech, Steven Rattner, the government auto head, said he was alarmed by the "stunningly poor management" at the Detroit companies and said GM had "perhaps the weakest finance operation any of us had ever seen in a major company."

Shockingly poor financial management at General Motors and Chrysler weakened their case for a federal bailout, but officials feared letting them collapse. Rattner described his six-month stint leading the Obama administration's auto task force, which pushed GM and Chrysler into quick bankruptcies last summer with the help of billions of dollars in federal aid. The task force won concessions from the union, suppliers, bondholders and dealers, and the U.S. government now owns nearly 61 percent of GM and 8 percent of Chrysler.

Rattner said the task force was divided on whether to save Chrysler. The automaker was poorly run during its alignment with Daimler AG, and "larded up with debt, hollowed out by years of mismanagement, Chrysler under (private equity firm) Cerberus never had a chance," he added.
The task force determined that Chrysler could not survive without a corporate partner and turned to Italy's Fiat Group SpA. Fiat took control of Chrysler after it emerged from bankruptcy protection in June and received a 20 percent stake in the company, with the opportunity to take on 35 percent.