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Filed under: Government/Legal, Recalls, Safety, Chrysler, GM

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According to The Wall Street Journal, Chrysler’s post-bailout restructuring allowed it to effectively erase any responsibility for car accident victims. Two years after the $12.5-billion auto industry bailouts, families like the one Vicki Denton left behind are stuck between a rock and a hard place.

The WSJ reports that Ms. Denton was killed in a head-on collision in which the airbag in her 1998 Dodge Caravan failed to deploy. A court ordered Chrysler to pay Denton’s son and surviving relatives $2.2 million in damages, but that was just before the bailout hit. Since Chrysler is no longer under any obligation to the family because the bailout measures absolved Chrysler from its liabilities, the Dentons will almost certainly never see their money and have no legal recourse to get it.

The Chrysler case isn’t unique. The same rings true at General Motors, where a $50-billion bailout and restructuring left asbestos victims, laid off dealers and accident victims without any way to secure their damages. Beyond the unfairness of the deal, some experts suggest paying accident victims wouldn’t have been out of the question.

Those who coordinated the bailouts maintain that in situations like the ones at GM and Chrysler, full recompense simply isn’t possible for everyone. As far as the courts are concerned, there is standing legal precedent to allow for such omissions during a bankruptcy restructuring.

WSJ looks at who the auto bailouts really left behind originally appeared on Autoblog on Fri, 27 May 2011 15:31:00 EST. Please see our terms for use of feeds.

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Filed under: Etc., Government/Legal, Hirings/Firings/Layoffs, Chrysler, GM, Earnings/Financials

You don’t have to be a pollster to know that for the most part, the American public remains none too happy about the federal government handing over the people’s hard-earned tax dollars to pull General Motors and Chrysler out of the fires of insolvency. Despite the fact that both companies have managed to keep their lights on, doors open and paychecks flowing due to their generous federal loans, Joe Plumber still can’t stand the thought of paying the price of the two companies’ failures. With midterm elections right around the corner, President Obama is in Detroit to attempt to sway that opinion.

The Commander-in-Chief will speak to crowds at Chrysler’s Jefferson North plant about the positive side of loaning close to $85 billion to two of our country’s largest automakers, including the fact that in 2010, the Big Three have re-hired a total of 55,000 of the 334,000 workers it sent packing a year prior. That may seem like a fraction of the total, but the President is certain to point out that without the loans, that job loss figure would have been much higher.

And then there’s the matter of getting the federal government’s money back. President Obama is also focusing on sharing his belief that a large majority of the country’s money will be returned once GM and Chrysler go public once again.

Interested in keeping tabs on Obama’s visit to Motown? The Detroit Free Press has a liveblog that you can follow along with (including live audio) by clicking here.

[Sources: Bloomberg, Detroit Free Press | Image: Jim Watson/AFP/Getty]

Obama working to pitch success of auto bailouts to American public originally appeared on Autoblog on Fri, 30 Jul 2010 13:29:00 EST. Please see our terms for use of feeds.

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