After more than 80 years of history, Chrysler will be filing for Chapter 11 Bankruptcy. Italian Fiat SpA will be cherry picking through the assets of Chrysler. Fiat is set to assume 20% stake in the restructured Chrysler, while U.S. domestic auto workers union group UAW will get slightly more than half (but will get only 1 representative in the board) while the Obama administration government will control the remaining stake.
The first Chrysler badged car was introduced in the 1924 New York Motor Show. The unofficial history was that Walter P. Chrysler refused to allow his prototype Chrysler Six to be displayed. Mr. Chrysler had a reputation for being restless and quick-tempered, and he did not took very well to responses given by organizers of the NY Motor Show. Enraged, he drove his prototype Chrysler Six straight into the show hall's lobby and parked it there for all to see.
Chrysler was not always seen as a sick lumbering dinosaur like it is today. This was the company that in 1936, its streamlined Airflow provided erm, for lack of a better term, "inspiration for reverse engineering" to Toyota's first car - the A1 sedan. In 1939, it released the Fluid Drive, a precursor to the modern day torque converter automatic transmission. In the swinging Motorama 50s, Chrysler introduced the Hydraglide, the world's first power steering. And those ridged wheels that all modern cars have that keep punctured / deflated tires from flying off the wheel, it was one of the many legacies that Chrysler left behind for the modern car industry.
The slow death of Chrysler started only started in 90s. This soon became evident when the company became increasingly reliant on retro styled cars and Viper, which has the sophistication of a lorry, to wow the public. There is a huge difference between paying homage to past legends and living off past glories. The Nissan GT-R is a great example of the former while the commercial flop Plymouth PT Cruiser is a case study for the later. By 1998, Bob Eaton and Juergen Schrempp pulled off one of the greatest commercial trickery in the industry by engineering the Daimler-Chrysler merger. Share holders were duped by the fancy spreadsheet drawn up those over-rated consultants and investment bankers, all pointing to how this "merger of equals" will add synergies to both companies. Eaton and Schrempp have since cashed in one their huge CEO bonuses and jumped ship before the corporate mothership of DaimlerChrysler sank. The American public was left holding the financially sick Chrysler, while Daimler-Benz severed all ties with their former partner. To be fair, Daimler was equally misled by Schrempp and Daimler never got much out of the deal anyway. Those Daimler-Chrysler years were the lowest point of Mercedes-Benz's famed built quality.
When private equity firm Cerberus Capital Management took over management of Chrysler in 2007, they hired ex-GE guy Robert Nardelli, who in one his first few meeting in Chrysler lashed out at everyone in the board room "You guys don't know how to run a f---ing business!" It is worth remembering that CNBC once voted this guy as one of the "Worst American CEOs of All Time." Nardelli has agreed to leave Chrysler once the bankruptcy proceedings are completed.
Walter Chrysler will be rolling in his grave if he were to know what happened to the company he founded almost 85 years ago.
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